IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 05.01.2009 CORAM: THE HONOURABLE MRS. JUSTICE PRABHA SRIDEVAN AND THE HONOURABLE MR.JUSTICE K.K.SASIDHARAN W.A.NOS.226 to 228 of 2006 and W.A.M.P. No.373 of 2007 T. Govindan .. Appellant in W.A.Nos.226 & 228 of 2006 S. Kaliyamoorthy .. Appellant in W.A.No.227 of 2006 -Vs.- 1. State Industries Promotion Corporation of Tamil Nadu, rep. by its Managing Director, No.19-A, Rukumani Lakshmipathy Road, Egmore, Chennai – 8. ..Ist Respondent in all petitions 2. K. Shanmugasundaram 3. K.S. Gunasekaran 4. K. Maruthiah 5. D. Ramani .. Respondents 2 to 5 in W.A.No.226 & 228/06 Prayer:- Writ Appeals against the common order dated 26.7.2005 in W.A.NOs. 8983 ,7718 & and 8984 of 1998 on the file of this court. WP.No.8983/98 : Writ petition filed under Article 226 of the Constitution of India to issue a Writ of Certiorari calling for the records relating to the impugned circular issued by the first respondent in No.E3/Misc/201/97 dated 03.06.1998, quash the same. WP.No.7718/98 : Writ petition under Article 226 of the Constitution of India to issue a Writ of Certiorarified Mandamus to call for the records connected with the impugned circular dated 03.06.1998, ref. No.E3/Misc/201/97, on the file of the respondent, and quash the same and consequently direct the respondent to asscess merit of the eligible candidates for promotion to the post of Assistant Managers only on the https://hcservices.ecourts.gov.in/hcservices/ basis of the confidential repairs and service record available with the respondent. WP.No.8984/98 : Writ Petition under Article 226 of the Constitution of India to issue a Writ of Certiorarified Mandamus calling for the records relating to the impugned proceedings of the first respondent in No.E3/Misc/201/97 dated 17.06.1998 quash the same to direct the respondent to promote the petitioner as Assistant Manager with retrospective benefits based upon the petitioners past service. For Appellants : Mr.V.Selvaraj For Respondents : NA COMMON JUDGMENT (Judgment of the Court was delivered by K.K.SASIDHARAN, J) These three writ appeals are directed against the common order dated 26.7.2005 in W.P.Nos.7718, 8983 and 8984 of 1998 whereby the learned Single Judge negatived the challenge made by the petitioners to the circular issued by the first respondent on 3.6.1998 prescribing the procedure for assessment of merits for the purpose of promotion to the post of Assistant Manager in the State Industries Promotion Corporation of Tamil Nadu. Background facts: 2. Since the factual matrix involved in all the three writ petitions are similar in nature, the averments as found in W.P.No.8983 and 8984 of 1998 are taken to narrate the background facts. 3. The appellant in Writ Appeal Nos.226 and 228 of 2006 (Petitioner in W.P.No.8983 and 8984 of 1998) was appointed as Junior Assistant in the first respondent Corporation in 1982. Subsequently, he was promoted as Assistant in 1985 and he was granted a further promotion as Assistant Officer on 15.7.1998. The next avenue of promotion was in the post of Assistant Manager. As per the service regulations, promotion to the post of Assistant Manager was from the cadre of Assistant Officer and to qualify for such promotion, an employee should have completed five years of service as Assistant Officer. As per Rule 3.12 of the Service Rules, the criteria for promotion to the post of Assistant Manager was merit and seniority would be considered only when merit was approximately equal. However there was no guideline as to how the merit has to be assessed and all along promotion from the cadre from Assistant Officer to Assistant Manager and other posts have been made on the basis of the service records alone. https://hcservices.ecourts.gov.in/hcservices/ 4. While so, the first respondent issued the impugned circular dated 3.6.1998 whereby the Corporation evolved a procedure for assessment of merits and as per the said procedure the candidate has to appear for the written test and interview, for consideration of his case for promotion to the post of Assistant Manager from the cadre of Assistant Officer. There were fourteen Assistant Officers, who were qualified for promotion as Assistant Managers and there were only five posts of Assistant Managers. In pursuance of the said circular, the first appellant appeared for the written test and interview but he was not selected and respondents 2 to 5 were selected. However the appellant in W.A.No.227 of 2006 did not appear for the written examination as well as subsequent interview though he was also qualified for promotion to the post of Assistant Manager. 5. Subsequent to the finalisation of the promotion list the appellants filed writ petitions challenging the circular dated 3.6.1998 as well as the promotion list published by the first respondent on 17.6.1998 promoting respondents 2 to 5 as Assistant Mangers in the Corporation. 6. The grievance of the appellants in the writ petitions appear to be the issue of circular for the first time for the purpose of assessment of relative merits of candidates for promotion to the post of Assistant Manager. According to the appellants, it was for the first time that such a circular was issued and the said circular has been issued by the Managing Director without the authorisation of the Chairman of the Corporation. It was their contention that a procedure has already been prescribed under Rule 3.12 and as such the Managing Director has no power to amend the service rules and introduce written test and oral interview as the method for assessment of the relative merits of the candidates. It was further contended that the appellants have got a clean record of service and as such they should have been promoted as Assistant Managers on the basis of the service records. According to them all along, the Corporation had been making promotions on the basis of service records and as such the first respondent was incompetent to issue the circular, which had the effect of amending the statutory rules. In the said factual premises, the appellants prayed for quashing the impugned circular dated 3.6.1998 as well as the select list published by the first respondent. 7. In the counter affidavit filed on behalf of the first respondent they have contended that, knowing fully well that such a circular was issued for the purpose of assessment of the relative merits of the candidates, the petitioner in W.P.Nos.8983 and 8984 of 1998 took part in the written test as well as interview and having found that he was not selected, he has chosen to challenge the circular. It was further contended that the appointing authority for the post of Assistant Manager was only the Managing Director and it was decided that in order https://hcservices.ecourts.gov.in/hcservices/ to assess the merits of the eligible Assistant Officers for promotion to the post of Assistant Manager, a Committee should be constituted to interview the candidates. The interview was considered essential since the post of Assistant Manager was in the managerial cadre in the Corporation and the promotees should have adequate knowledge to carry out the duties attached to the said post. The Board of Directors of the first respondent Corporation at its meeting held on 27.5.1998 took note of the constitution of the committee to assess the merits of the candidates for promotion to the higher post in the Corporation and it was suggested that two more outside members with reputation for high integrity should be included in the Committee and a written test may also be prescribed for internal candidates to assess their skill and aptitude. Accordingly the selection committee was constituted with the Chairman, Managing Director of the Corporation, Additional Director of Industries and Commerce and Joint Director, Finance Department of the Government of Tamil Nadu and it was only to implement the decision taken by the Board of Directors that the impugned circular was issued calling upon the eligible Assistant Officers to appear for the written test and subsequent interview for assessing their suitability for promotion to the post of Assistant Manager. The first respondent has also denied the allegation that the impugned circular was not sanctioned by the Chairman and they have also contended that the circular was issued only as per the decision of the Corporation. The first respondent also justified the selection and according to them a fair procedure was adopted by the Corporation for assessing the merits of the candidates. Disposal of Writ Petitions: 8. The learned Single Judge found that as per Rule 3.12 of the Service Rules of the first respondent Corporation, the basic criteria for promotion was prescribed to be one of merit and seniority would be taken into consideration only when merit was approximately equal and opined that the holding of written test by constituting a committee for the said purpose cannot be held to be violative of Rule 3.12 of the Service Rules. Accordingly the learned Single Judge held that holding of written test would definitely enable the concerned authorities to make a better assessment of the individual merits of the candidates for the purpose of promotion and as such the impugned circular was only by way of supplementing the rule prescribed for promotion and dismissed the writ petitions. Challenging the said order, the petitioners have come up with the present appeals. Submissions:- 9. Thiru V.Selvaraj, learned counsel for the appellants contended that the impugned circular dated 3.6.1988 was clearly in violation of the procedure contemplated under Rule 3.12 of the Service Rules inasmuch as the first respondent was not having the authority to change the mode of selection by way of a circular and without amending the service https://hcservices.ecourts.gov.in/hcservices/ rules. It was his further contention that all along the first respondent has been assessing the merits on the basis of personal records of the concerned employee and for the first time, during the relevant year they have come up with the circular only to deny promotion to the candidates like the appellants, for the reasons best known to the first respondent. The learned counsel also submitted that the appellants have got a very clean record and the same would be evident from the good entries made by the higher officials of the first respondent Corporation and as such the first respondent should have followed the earlier practice of giving promotion by assessing the merit on the basis of entries in the service records. Circular – Whether supplementary to the rules:- 10. The first respondent has framed their service regulations and as per Rule 3.12, the basic criteria for promotion is merit and seniority would be taken into consideration only when merit was approximately equal. It was also provided that the guidelines issued by the Government should be observed in the matter of promotion. Even though the eligible criteria was prescribed as merit and seniority was only secondary, no guidelines were framed as to the manner in which the merit has to be assessed for the purpose of promotion. It is the admitted case of the parties that no guidelines were framed earlier and the Corporation was following the procedure of assessment on merits on the basis of service records. However the management was of the view that there should be a clear guideline to assess the relative merits of the employees for the purpose of grant of promotion and the same was all the more necessary in the case of promotion to the managerial cadre. The post involved in the present matter is that of Assistant Manager, which admittedly is a managerial cadre. Therefore the Corporation took a policy decision to conduct written test as well as oral interview for the purpose of assessment of the relative merits or otherwise of the employees. The circular was issued in pursuance of the decision of the Board as found from the counter affidavit filed by the Corporation. The impugned circular is only a supplementary to the service rules and the same is not in contravention of the rules. Admittedly the consideration for promotion is only merit and the guidelines prescribes the mode and method by which merit has to be assessed by the Corporation. Therefore it cannot be said that the circular has no legal sanction or that the same was issued in variance of the statutory rules as contained in Rule 3.12 of the service rules. 11. In order to consider the relative merits of the employees, so many factors would be taken into consideration by the employer. In case the service rules provides the factors to be taken note of for determining the merit, the employer was expected to assess the merits in accordance with those rules. However in case where there was no such guidelines provided in the service regulations, the Selection Committee was required to adopt a rationale procedure or method or criteria which https://hcservices.ecourts.gov.in/hcservices/ is reasonable and fair for the purpose of assessment of merit. The seniority is only one among such factors, which would be taken into consideration for promotion. It was only in the event of the merits of the candidates being equal, that the seniority has got a play in the matter of promotion, unless otherwise provided in the service rules. 12. Even though the service regulations provides that promotion shall be only on merit, there was no indication in the said rule as to how the merit has to be assessed. It was only for the said purpose for evolving a specified procedure that the impugned circular was issued by the Corporation. By no stretch of imagination, it can be said that the circular had the effect of nullifying the statutory regulations and in fact it was not in conflict with the procedure already laid down in the service regulations. 13. The learned counsel for the appellants vehemently contended that the impugned circular was at variance with the statutory rules and as such the first respondent was clearly in error in relying on the said circular for grant of promotion to the respondents 2 to 5. A close scrutiny of the rules and circular clearly shows that the circular was only explanatory in nature and it indicates only the method to be followed by the Corporation for assessment of merit. Promotion – A management function:- 14. The Honourable Supreme Court in K.SAMANTARAY v. NATIONAL INSURANCE COMPANY LTD., [JT 2003 (Suppl.1) SC 14] indicated that it was within the province of the management to evolve a fair procedure and adjudging the claims of different employees for the purpose of promotion and made the legal position thus:- "While laying down the promotion policy or rule, it is always open to the employer to specify area and parameter of weightage to be given in respect of merit and seniority separately so long as policy is not colourable exercise of power, or has the effect of violating of any statutorily scope of interference and other relatable. The decision in B.V.Sivaiah case (supa) is clearly distinguishable on facts and in law. That was a case where statutory rules governed the field. This Court, inter alia, held that fixing terms which are at variance with the statutory rules is impermissible. In the case on hand, prior to the formulation of policy in February, 1`990, there were no codified prescriptions. It was the stand of the respondent-employer that prior to the formulation of the policy, certain https://hcservices.ecourts.gov.in/hcservices/ guidelines existed and the objectives of the policy were to rationalize and codify the existing guidelines relating to promotions within officers cadre. There is no statutory rule operating. It is for the employer to stipulate the criteria for promotion, the same pertaining really to the area of policy making. It was, therefore, permissible for the respondent to have their own criteria for adjudging claims on the principle of seniority-cum-merit giving primacy to merit as well, depending upon the class, category and nature of posts in the hierarchy of administration and the requirements of efficiency for such posts. " 15. In Andhra Bank v. B. Satyanarayana,(2004) 2 SCC 657, the Supreme Court reiterated the legal position that the employer is entitled to take a policy decision to fix the criteria for grant of promotion in the following words:- "11. It is a well-settled principle of service jurisprudence that the employer is entitled to lay down policy decision laying down the criteria for grant of promotion to its officers. The eligibility norms for such promotions must be defined by the bank on a realistic basis wherefor a system to choose the best-available talent to man the critical positions is to be devised. Once a power vests in an authority by reason of the provisions of a statute, it is trite that such power can be exercised from time to time. Changes are required to be made keeping in view the requirement of the management as also the exigency of the situation obtaining at the relevant time." 16. In a recent decision reported in 2008(9) SCC 243 (UNION OF INDIA v. PUSHPA RANI), the Honourable Supreme Court considered the authority of the employer to prescribe the method of recruitment and the lack of expertise in the Court to suggest the manner and method of structuring or re-structuring the cadres or for evaluation of the merits of the candidates and observed thus: "Before parting with this aspect of the case, we consider it necessary to reiterate the settled legal position that matters relating to creation and abolition of posts, formation and structuring/ restructuring of cadres https://hcservices.ecourts.gov.in/hcservices/ prescribing the source/mode of recruitment and qualifications, criteria of selection, evaluation of service records of the employees fall within the exclusive domain of the employer. What steps should be taken for improving efficiency of the administration is also the preserve of the employer. The power of judicial review can be exercised in such matters only if it is shown that the action of the employer is contrary to any constitutional or statutory provision or is patently arbitrary or is vitiated due to mala fides. The court cannot sit in appeal over the judgment of the employer and ordain that a particular post be filled by direct recruitment or promotion or by transfer. The court has no role in determining the methodology of recruitment or laying down the criteria of selection. It is also not open to the court to make comparative evaluation of the merit of the candidates. The court cannot suggest the manner in which the employer should structure or restructure the cadres for the purpose of improving efficiency of administration." Challenge to the Selection Procedure by unsuccessful candidates – whether permissible: 17. The appellant in W.A.Nos.226 and 228 of 2006 took part in the selection process knowing fully well that his claim for promotion would be decided only in accordance with the procedure prescribed as per the impugned circular dated 3.6.1998. It was only when he found that his performance in the written test as well as oral interview was not satisfactory and that respondents 2 to 5 came out successfully in the selection process that he has chosen to challenge the circular. It is not permissible for a candidate, who had undergone the selection process on the basis of a given procedure, to challenge the selection procedure subsequent to the conclusion of the process. The first appellant had submitted to the jurisdiction of the Selection Board and his merit was subjected to the assessment. Therefore he is estopped from challenging the selection process at a later point of time. 18. In Madan Lal v. State of J&K, (1995) 3 SCC 486, the Honourable Supreme Court held that a candidate, who appeared for the selection is estopped from challenging the selection process after the finalisation of the process and observed thus:- "9. Before dealing with this contention, we must keep in view the salient fact that the https://hcservices.ecourts.gov.in/hcservices/ petitioners as well as the contesting successful candidates being respondents concerned herein, were all found eligible in the light of marks obtained in the written test, to be eligible to be called for oral interview. Up to this stage there is no dispute between the parties. The petitioners also appeared at the oral interview conducted by the Members concerned of the Commission who interviewed the petitioners as well as the contesting respondents concerned. Thus the petitioners took a chance to get themselves selected at the said oral interview. Only because they did not find themselves to have emerged successful as a result of their combined performance both at written test and oral interview, they have filed this petition. It is now well settled that if a candidate takes a calculated chance and appears at the interview, then, only because the result of the interview is not palatable to him, he cannot turn round and subsequently contend that the process of interview was unfair or the Selection Committee was not properly constituted. In the case of Om Prakash Shukla v. Akhilesh Kumar Shukla1 it has been clearly laid down by a Bench of three learned Judges of this Court that when the petitioner appeared at the examination without protest and when he found that he would not succeed in examination he filed a petition challenging the said examination, the High Court should not have granted any relief to such a petitioner." 19. In Chandra Prakash Tiwari v. Shakuntala Shukla,(2002) 6 SCC 127 the Honourable Supreme Court after considering an earlier decision in Om Prakash Shukla v. Akhilesh Kumar Shukla (1986 Supp SCC 285) held thus:- "34. There is thus no doubt that while question of any estoppel by conduct would not arise in the contextual facts but the law seems to be well settled that in the event a candidate appears at the interview and participates therein, only because the result of the interview is not “palatable” to him, he cannot turn round and subsequently contend that the process of https://hcservices.ecourts.gov.in/hcservices/ interview was unfair or there was some lacuna in the process." 20. The appellants have no case that the selection process was vitiated on account of favouritism or malafides and in fact no act of malafides were alleged against the Selection Board. Therefore it cannot also be said that the selection was tainted with malafides. Scope of Judicial Review:- 21. It is trite that judicial review is very limited in the matter of grant of promotion as the same is essentially a managerial function and the assessment of relative merits of the employees have to be left to the management. The Court is mainly concerned with the decision making process. While exercising the power of judicial review, the Court is not expected to undertake a review of the assessment made by the Expert Committee and to substitute its views in the place of the Committee. However things would be different in case it was demonstrated that the claim of a particular employee was negatived on extraneous reasons and the entire action was tainted with malafides and the employee was subject to an act of victimisation. In such cases, it would be possible for the Courts and Tribunals to consider such acts of malafides and to render its findings. Even then it is not within the province of the Courts and Tribunals to declare the promotion of the aggrieved employee. The proper course would be to set aside the impugned order of promotion and to direct the authorities to undertake a fresh exercise in the light of the findings rendered and observation made by the Court. To sum up: 22. The learned Single Judge was perfectly correct in his conclusion that the circular dated 3.6.1998 was issued only as a supplementary to the regulation as prescribed under Rule 3.12 and that the conduct of written test would definitely enable the authorities to make a better assessment of the individual merits of the candidates for the purpose of promotion. Therefore we do not find any merit in the contention of the appellants. 23. In the result, the writ appeals are dismissed. Consequently, the connected WAMP is closed. No costs. Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar https://hcservices.ecourts.gov.in/hcservices/ Tr/ To 1. The Managing Director, State Industries Promotion Corporation of Tamil Nadu, No.19-A, Rukumani Lakshmipathy Road, Egmore, Chennai – 8. 1 cc To Mr.V.Selvaraj, Advocate, SR.719. W.A.NOs.226 to 228 OF