2019 (6) TMI 1528 - HC - Indian Laws

Clearance of Departmental Examination for Income Tax Officers held in the year 2003 - grant of two advance increments w.e.f 17.11.2003 - promotion of applicant as Income Tax Officer w.e.f 7.4.2005, the date on which his immediate junior was promoted and grant him consequential monetary benefits including re fixation of pension and other terminal benefits - HELD THAT - The petitioner is obviously relying on the introductory part, more particularly, that portion of the same which makes 'the Modified Rules' applicable for the Departmental Examination to be held in 1998 onwards. True that the words 'to be held in 1998 onwards' were used therein. But, the fact is that examinations for the year 1998 and subsequent years were completed by then and hence, the petitioner could not be heard to contend that based on the lowering of the 'Pass Percentage' from 26.5.2008, he should be declared to have passed the examination. True that it was made clear therein that all the Departmental Examinations for Income Tax Officers held upto 1997 and the results of which were declared would continue to be governed by the Departmental Examination for ITOs issued under the Directorate's letter F.No.EG(20) (8) 93/DIT to 6625 dated 18/26.11.1993 as amended from time to time. As noticed hereinbefore, the petitioner had appeared for the Departmental Examinations to be cleared for promotion to the post of Income Tax Officer in the years 2000, 2001, 2002 and 2003. During those relevant periods, it was being governed by the Rules for the Departmental Examination for Income Tax Officers-1998. The rules relating to the conduct of the Departmental Examinations were modified and the percentage required for a pass was reduced to 50% for each paper only as per the 'Modified Rules' and Modified Rules relating to pass percentage viz., Clause VI was given effect only from 26.5.2008. Hence, how can the petitioner bring in a challenge on the ground of discrimination and canvass the position that it should be deemed to have come into operation with retrospective effect from 1998 as relates 'pass percentage'? There can be no doubt with respect to the position that an amendment with such a consequence cannot be made as it would then result in taking away of the accrued right of a large number of personnel. The contention of the petitioner that giving effect to Rule IV of the Modified Rules with effect from 26.5.2008 should be taken as prescription of cut off date also cannot be accepted in the said circumstances. It actually prescribes that from 26.5.2008, a candidate for ITO examination would be declared to have completely passed the Departmental Examination for ITOs if he secures a minimum of 50% (45% in case of SC/ST) in each of the subjects included. It also would not amount to classification of employees. If the required 'pass percentage' in respect of departmental examinations is brought down from 60% to 50% with retrospective effect unmindful of the fact promotions were effected and promotees have already assumed charge in the promoted post, it would cause total chaos in the matter of administration. That apart, in such circumstances, one cannot be oblivious of the position that an accrued right cannot be taken away by making modification in the rules after the examination, publication of the result and consequential action in effecting promotions. Very rightly, the respondents have carefully incorporated Rule VI and gave effect to it only prospectively, realising and recognizing such settled position of law. If persons who could not acquire the requisite 'pass percentage' in examinations conducted prior to the commencement of the Modified Rules, are declared as passed by virtue of the Modified Rules with effect from a previous day, it would certainly entail reversion of many hands who were promoted on passing such tests in view of the requirement in that regard during the relevant period. The Tribunal had rightfully repelled those contentions. Merely by mounting challenge against the modified rules, the petitioner cannot be permitted to resurrect the aforesaid questions based on the principle of res judicata. The petitioner cannot be permitted to raise new contentions in the light of the 'ought and might' principles contained in the doctrine of constructive res judicata. Petition dismissed.

Summary

Issues Involved:
1. Retrospective application of modified rules reducing pass marks from 60% to 50%.
2. Constitutionality of the cut-off date for the implementation of modified rules under Articles 14 and 16(1).

Issue-wise Detailed Analysis:

1. Retrospective Application of Modified Rules:
The petitioner, a retired Income Tax Officer, sought the retrospective application of the modified rules reducing the pass percentage from 60% to 50% for the Departmental Examination for Income Tax Officers. The petitioner argued that the modified rules should be applied retrospectively, thereby declaring him eligible for promotion based on his performance in the 2003 examination. The Tribunal dismissed this claim, stating that results of the Departmental Examinations must be evaluated based on the rules in force at the time of the examination. The Tribunal found that the modified rules were not intended to correct an omission or serve as explanatory but were a substantive change applicable only from 26.5.2008. The High Court upheld this view, emphasizing that legislation is prima facie prospective unless expressly stated otherwise. Retrospective application would disrupt settled promotions and create administrative chaos, as it would necessitate reversion of those already promoted under the old rules.

2. Constitutionality of the Cut-off Date:
The petitioner challenged the cut-off date of 26.5.2008 for the implementation of the reduced pass percentage, arguing it created an unreasonable classification violating Articles 14 and 16(1) of the Constitution. The petitioner contended that this prospective application led to hostile discrimination against those who had taken the examination under the old rules. The Tribunal and the High Court rejected this contention, noting that the modification of pass marks was a policy decision and not a correction of a mistake. The High Court referenced the case of Indra Sawhney v. Union of India, stating that the modification did not aim to correct discrimination but was a policy change. The Court also noted that the petitioner’s claim was barred by the principle of res judicata, as the issue had been previously adjudicated and attained finality with the Supreme Court’s dismissal of the petitioner’s Special Leave Petition.

Conclusion:
The High Court dismissed the original petition, finding no merit in the petitioner’s claims. The Court upheld the Tribunal’s decision, affirming that the modified rules reducing the pass percentage were not intended to have retrospective effect and that the cut-off date did not constitute unreasonable classification or violate constitutional provisions. The petitioner’s attempt to re-litigate the issue was barred by res judicata, and the Court emphasized the settled legal principle that legislation is prospective unless explicitly stated otherwise.