Case: National Building Const. Corpn Vs. S Raghunathan

approach of the High Court was wholly erroneous and the reasoning is equally fallacious.30. As pointed out by this Court in Food Corporation of India v. Kamdhenu Cattlefield (Cattlefeed?) Industries, (1993) 1 SCC 71 , which has already been referred to above, the question whether the expectation and the claim is reasonable or legitimate, is a question of fact in each case. It was also observed that this question had to be determined not according to the claimants perception but in larger public interest.31. Incidentally, in this case, the question of "Legitimate Expectation" was not raised in the petition and no foundation was laid in the pleadings for such a plea being advanced before the Court. Strangely, the High Court allowed this plea at the stage of argument and allowed the petitions only on the grounds of "Legitimate Expectation" without least realising that there was hardly any legitimacy in the claim of the respondents. In the absence of pleading and the affidavit of the respondents in support thereof, the whole exercise done by the High Court cannot but be termed to be speculative.32. That apart, the High Court suffered from a misconception that whenever there was a revision of the pay scales, Foreign Allowance as also the other allowances were correspondingly raised on the basis of the revised basic salary. Respondents had served on deputation with the NBCC in their foreign projects at Iraq from 1982-83 to 1986-87 and during this period the pay structure was revised only once to implement the recommendations of the Fourth Pay Commission. Was there any other revision in the pay structure of the respondents or any of them during their tenure with the NBCC; if so, when ? To whom was the benefit of such revision available ? Who are those other Officers and employees serving on deputation in a foreign country who were benefitted by any revision in the pay structure during the period 1982-83 to 1986-87 ? These are the few questions which legitimately arise, and unless there is material on record to answer these questions, the observations of the High Court that whenever there was a revision in the pay scales, Foreign Allowance was correspondingly increased and, therefore, the respondents had come to entertain "Legitimate Expectation", are wholly speculative, besides being erroneous. 33. Foreign Allowance could also not be treated as a salary component or akin to Deputation (Duty) Allowance as it was in the nature of a residuary perk regulated by the provisions of F.R. 51(2). 34. Fundamental Rule 51 provides as under :- "F.R. 51. (1) When a Government servant is, with proper sanction, temporarily deputated for duty out of India either in connection with the post held by him in India or in connection with any special duty on which he may temporarily be placed, he may be allowed by the President to draw during the period of deputation the same pay which he would have drawn had he remained on duty in India : Provided that a Government servant, who is placed on deputation while already on leave out of India on average pay, may be required by the President to continue to be on leave, in which case he shall be given during that period, in additional to his leave salary, an honorarium of one-sixth of the pay which he would have drawn had he remained on duty in India; the cost of passages from and to India shall be borne by him. (2) A Government servant on deputation may also be granted a compensatory allowance in a foreign country of such amount as the President may think fit. (3) The foreign exchange equivalent of the pay, honorarium or compensatory allowance admissible under sub-rule (1) or sub-rule (2) shall be calculated at such rate of exchange as the President may by order prescribe." 35. Sub-rule (2) of Rule 51, quoted above, gives a discretion to the Government to pay to the Government servant, on deputation in a foreign country, such compensatory allowance as may be thought fit by the President. The payment of compensatory allowance as also the quantum of such allowance is left to the absolute discretion of the President. It was for this reason perhaps that the High Power Committee did not make any recommendation in respect of Foreign Allowance and left it to the discretion of NBCC to decide whether it would be payable or not at all, and if payable, at what rate. The Ministry of External Affairs had already fixed Foreign Allowance under F.R. 51(2) for its officers and other staff working in its Missions abroad. The NBCC, therefore, issued the order dated 15th October, 1990 specifying the benefits which would be available to its employees and deputationists with effect from 1.1.1986. It was in this order that it was indicated that Foreign Allowance would continue to be payable at the rate of 125% of the basic pay (pre-revised) as on or upto 31.12.1985. There was thus no increase in the Foreign Allowance payable to the respondents; nor was the amount reduced in any way. 36. NBCC had taken a policy decision on account of strange situations and conditions prevailing in Iraq where respondents were deputed on foreign projects assigned to NBCC, that Foreign Allowance would be payable only on the original basic salary of the respondents and not on the salary as revised on account of the recommendations of the Fourth Pay Commission. In such a situation, the policy decision shall have the effect of displacing the doctrine of "Legitimate Expectation", particularly as the decision was based on objective assessment of the prevailing circumstances including the financial stringency in which Iraq came to be placed. There is, therefore, no element of arbitrariness in that decision. 37. The respondents were the prisoners of hope. They attempted to water the leaves when the tree itself was found cut off at its root. This is the least that can be said of this case which had no pleadings and yet the plea prevailed.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]29. The above extracts indicate the reasoning and the approach of the High Court. They indicate the precise ground on which the claim of the respondents was allowed. We are constrained to observe that the approach of the High Court was wholly erroneous and the reasoning is equally fallacious.30. As pointed out by this Court in Food Corporation of India v. Kamdhenu Cattlefield (Cattlefeed?) Industries, (1993) 1 SCC 71 , which has already been referred to above, the question whether the expectation and the claim is reasonable or legitimate, is a question of fact in each case. It was also observed that this question had to be determined not according to the claimants perception but in larger public interest.31. Incidentally, in this case, the question of "Legitimate Expectation" was not raised in the petition and no foundation was laid in the pleadings for such a plea being advanced before the Court. Strangely, the High Court allowed this plea at the stage of argument and allowed the petitions only on the grounds of "Legitimate Expectation" without least realising that there was hardly any legitimacy in the claim of the respondents. In the absence of pleading and the affidavit of the respondents in support thereof, the whole exercise done by the High Court cannot but be termed to be speculative.32. That apart, the High Court suffered from a misconception that whenever there was a revision of the pay scales, Foreign Allowance as also the other allowances were correspondingly raised on the basis of the revised basic salary. Respondents had served on deputation with the NBCC in their foreign projects at Iraq from87 and during this period the pay structure was revised only once to implement the recommendations of the Fourth Pay Commission. Was there any other revision in the pay structure of the respondents or any of them during their tenure with the NBCC; if so, when ? To whom was the benefit of such revision available ? Who are those other Officers and employees serving on deputation in a foreign country who were benefitted by any revision in the pay structure during the period87 ? These are the few questions which legitimately arise, and unless there is material on record to answer these questions, the observations of the High Court that whenever there was a revision in the pay scales, Foreign Allowance was correspondingly increased and, therefore, the respondents had come to entertain "Legitimate Expectation", are wholly speculative, besides being erroneous.