# B.V. SIVAIAH AND ORS v. K. ADDANKI BABU AND ORS - **Citation:** [1998] 3 S.C.R. 782 - **Court:** Supreme Court of India - **Decided:** 1998-07-17 - **Case number:** Civil Appeal No. 3798of1996 - **Bench:** S.C. Agra Wal, S.P. Bharucha, B.N. Kirpal - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/b-v-sivaiah-and-ors-v-k-addanki-babu-and-ors-16405 - **Pages:** 24 ## Headnote Service Law : Promotion-Rule prescribing seniority-cum-merit criterion-Authority c making promotion.on the basis of officers securing highest marks amongst ' eligible officers-Challenged-Held, seniority-cum-merit implies prescribing minimum standard for assessing merit and from amongst those fulfilling the minimum standard making promotion on the basis of inter se seniorityComparative assessment of merit not required-Requirement of interview and D assessment of service in Rule cannot be construed as permitting comparative assessment-Principle laid down applied to promotions in different Regional Rural Banks-Regional Rural Banks (Appointment and Promotio11s of Officers and other Employees) Rules, 1988-Second Schedule, Para 7. Promotion-Employees appointed on same date and having same length E of service-Inter se seniority-Determination of-Held, it is determined on the basis of placement in the Select List for appointment-Such determination · conje·rs ·cer:!_ai!I rights-Seniority-cum-merit criterion gives effect to such rights flowing from seniority-select list. Promotion-Seniority-cum-merit and merit-cum-seniority-Comparison F of-Held, seniority-cum-merit lays greater emphasis on seniority and comparative assessment of merit not required, whereas merit-cum-seniority lays greater emphasis on merit and ability and comparative assessment of merit required. Delay!Laches-Promotion challenged after five years-Persons G promoted acquiring certain rights-Held, persons cannot be deprived of such rights-Petition rightly rejected-Constitution of India-Article 226. Words & Phrases- 'Seniority-cum-merit' & 'Merit-cum-seniority'- Meaning of in Service Law. H Appellants are the Regional Rural Banks in the States of Andhra 782 + ,..., - ..... '>- , c - \ \ B.V. SIVAIAH v. K. ADDANKI BABU 783 Pradesh and Madhya Pradesh and Officers promoted by these banks to the A post of Area/Senior Manager. "Seniority-cum-merit" was the criterion prescribed for promotion to the post of Area/Senior Manager under the Regional Rural Banks (Appointment & Promotion of Officers and Other employees) Rules, 1988. The various Regional Rural Banks laid down the promotion process according to which selection was to be made on the basis B of marks awarded for seniority, qualification, performance, interview, etc. Generally selections were made on the basis of total number of marks obtained and officers who secured highest number of marks were promoted. The unsuccessful persons challenged the promotions in various writ petitions in the High Courts of Andhra Pradesh and Madhya Pradesh. In the C case ofRayalseema Grameena Bank, promotions made on may 3, 1988 were only challenged in 1993 alongwith subsequent promotions to the said post. Single Judge allowed the writ petitions and declared the promotions illegal and improper. Writ petition challenging the promotions made on May 3, 1988 was, however, dismissed on the ground of !aches. Against the judgment of the Single Judge, the Regional Rural Banks and the promoted officers D preferred appeals in the High Court. Division Bench dismissed the appeals and confirmed the judgement of the Single Judge. The view of both the High Courts was that the method of selection was contrary to the principle of 'seniority-cum-merit' prescribed by the Rules as Seniority had not been given due weight and held that the senior most eligible employee should have E been assessed for the minimum required merit for holding the higher post and only on his not being found suitable or fit, his immediate junior could be tested. Aggrieved by the order of the Division Bench, the Regional Rural Banks and the promoted officers have filed the present appeals. The appellants contended that the criterion of 'seniority-cum-merit' F allowed comparative merit to be assessed for the purpose of promotion by placing reliance on Para 7(c) of the Second Schedule to the Rules; that among officers who where appointed on the same date and have the same length of service ## Text _Characters 0–39,767 of 56,600. This is a partial read: ask again with offset=39767 for what follows._ A B.V. SIVAIAH AND ORS. v. K. ADDANKI BABU AND ORS. JULY 17, 1998 B [S.C. AGRA WAL, S.P. BHARUCHA AND B.N. KIRPAL, JJ.] Service Law : Promotion-Rule prescribing seniority-cum-merit criterion-Authority c making promotion.on the basis of officers securing highest marks amongst ' eligible officers-Challenged-Held, seniority-cum-merit implies prescribing minimum standard for assessing merit and from amongst those fulfilling the minimum standard making promotion on the basis of inter se seniorityComparative assessment of merit not required-Requirement of interview and D assessment of service in Rule cannot be construed as permitting comparative assessment-Principle laid down applied to promotions in different Regional Rural Banks-Regional Rural Banks (Appointment and Promotio11s of Officers and other Employees) Rules, 1988-Second Schedule, Para 7. Promotion-Employees appointed on same date and having same length E of service-Inter se seniority-Determination of-Held, it is determined on the basis of placement in the Select List for appointment-Such determination · conje·rs ·cer:!_ai!I rights-Seniority-cum-merit criterion gives effect to such rights flowing from seniority-select list. Promotion-Seniority-cum-merit and merit-cum-seniority-Comparison F of-Held, seniority-cum-merit lays greater emphasis on seniority and comparative assessment of merit not required, whereas merit-cum-seniority lays greater emphasis on merit and ability and comparative assessment of merit required. Delay!Laches-Promotion challenged after five years-Persons G promoted acquiring certain rights-Held, persons cannot be deprived of such rights-Petition rightly rejected-Constitution of India-Article 226. Words & Phrases- 'Seniority-cum-merit' & 'Merit-cum-seniority'- Meaning of in Service Law. H Appellants are the Regional Rural Banks in the States of Andhra 782 + ,..., - ..... '>- , c - \ \ B.V. SIVAIAH v. K. ADDANKI BABU 783 Pradesh and Madhya Pradesh and Officers promoted by these banks to the A post of Area/Senior Manager. "Seniority-cum-merit" was the criterion prescribed for promotion to the post of Area/Senior Manager under the Regional Rural Banks (Appointment & Promotion of Officers and Other employees) Rules, 1988. The various Regional Rural Banks laid down the promotion process according to which selection was to be made on the basis B of marks awarded for seniority, qualification, performance, interview, etc. Generally selections were made on the basis of total number of marks obtained and officers who secured highest number of marks were promoted. The unsuccessful persons challenged the promotions in various writ petitions in the High Courts of Andhra Pradesh and Madhya Pradesh. In the C case ofRayalseema Grameena Bank, promotions made on may 3, 1988 were only challenged in 1993 alongwith subsequent promotions to the said post. Single Judge allowed the writ petitions and declared the promotions illegal and improper. Writ petition challenging the promotions made on May 3, 1988 was, however, dismissed on the ground of !aches. Against the judgment of the Single Judge, the Regional Rural Banks and the promoted officers D preferred appeals in the High Court. Division Bench dismissed the appeals and confirmed the judgement of the Single Judge. The view of both the High Courts was that the method of selection was contrary to the principle of 'seniority-cum-merit' prescribed by the Rules as Seniority had not been given due weight and held that the senior most eligible employee should have E been assessed for the minimum required merit for holding the higher post and only on his not being found suitable or fit, his immediate junior could be tested. Aggrieved by the order of the Division Bench, the Regional Rural Banks and the promoted officers have filed the present appeals. The appellants contended that the criterion of 'seniority-cum-merit' F allowed comparative merit to be assessed for the purpose of promotion by placing reliance on Para 7(c) of the Second Schedule to the Rules; that among officers who where appointed on the same date and have the same length of service seniority cannot have any bearing and promotions have to be made on the basis of comparative assessment of merit of such officers; G and that though not challenging the promotions made on May 3, 1998 in Rayalseena Grameena Bank in this court, but since subsequently some appellants have also been promoted, the inter se seniority on the post of Area/ Senior Manager should be restored. This Court explained the criterion of 'seniority-cum-merit' and applying H 784 SUPREME COURT REPORTS [1998] 3 S.C.R. A the said criterion to each Regional Rural Bank with regard to its peculiar facts and circumstances. HELD : l. In the matter of formulation of a policy for promotion to a higher post, the two competing principles which are taken into account are inter se seniority and comparative merit of employees who are eligible for B promotion. The principle of 'merit-cum-seniority' lays greater emphasis on merit and ability and seniority plays a less significant role. Seniority is to be given weight only when merit and ability are approximately equal. On the other hand, the criterion of 'seniority-cum-merit' lays greater emphasis on ~ seniority. Comparative assessment of merit is required to be made while C applying the criterion o{ 'merit-cum-seniority' and for 'seniority-cum-merit' no such comparative assessment is required. [789-H; 790-A, D; 791-B] Union of India v. Mohan Lal Capoor & Ors., (1974) 1 SCR 797, affirmed. D Sant Ram Sharma v. State of Rajasthan & Ors., (1968) 1 SCR 111, referred to . . State of Mysore v. C.R Seshadri & Ors., [1974) 3 SCR 87, distinguished. 2. While applying the principle of seniority-cum-merit for the purpose E of promotion what is required to be considered is inter se seniority of the employees who are eligible for consideration. Such seniority is normally determined on the basis of length of service, but as between employees appointed on the same date and having the same length of service, it is generally determined on the basis of placement in the select list for appointment. Such determination of seniority confers certain rights and the F principle of seniority-cum-merit gives effect to such rights flowing from seniority. It cannot, therefore, be said that in the matter of promotion on the basis of seniority-cum-merit seniority has no role where the employees eligible for promotion were appointed on the same date and have the same length of service. (794-D-E] G 3. The criterion of 'seniority-cum-merit' in the matter of promotion postulates that given the minimum necessary merit requisite for efficiency of administration the senior, even though less meritorious, sh~ll have priority and a comparative assessment of merit is not required to be made. J;or assessing the minimum necessary merit the competent authority can lay H down the minimum standard that is required and also prescribe th~ mode of - ,. c B.V. SIVAIAHv. K. ADDANKI BABU 785 assessment of merit of the employee who is eligible for consideration for A promotion. Sush assessment can be made by assigning marks on the basis of appraisal of performance on the basis of service record and interview and prescribing the minimum marks which would entitle a person to be promoted on the basis of seniority-cum-merit. [794-F-G) State of Kera/a & Anr. v. N.M Thomas & Ors., [1976) 1 SCR 906, B followed. State of Mysore &Anr. v. Syed Mahmood & Ors., [1968) 3 SCR 363, relied on. Jagathigowda C.N. & Ors. v. Chairman, Cauvery Gramina Bank & C Ors., [1996] 9 SCC 677, explanied and affirmed. State of Mysore v. C. R. Seshadri & Ors., [19741 3 SCR 87, distinguished. 4. Para 7 (c) of the Second Schedule to the Rule dose not lend support to the contention that the criterion of seniority-cum-merit envisaged by the D Rule making authority involves assessment of comparative merit for purpose of promotion. The word 'selection' has been used in the sense of selecting an officer for promotion on the basis of the criterion of seniority-c11m-merit. The requirement that such selection shall be made on the basis of interview and assessment of performance reports for the preceding three years is consistent with the criterion of seniority-cum-merit and enables an E assessment to be made about the minimum necessary merit requisite for efficiency of administration and it cannot be construed as importing assessment of comparative merit of the officers eligible for promotion. (792-B-D] 5. Since there was no challenge to the promotions made on May 3, F 1988 till 1993, the promoted officers had been working for nearly five years by then and had acquired right to seniority on the basis of such promotion and they cannot be deprived of the said right. The High Court has rightly held that the belated challenge to the promotions made on May 3, 1988 cannot be entertained. [798-D-E] G 6. In the facts and circumstances, the appeals filed by the Rayalaseena Grameena Bank, Pinakini Grameena Bank, Baster Kshetriya Gramin Bank, Rewa Sidhi Gramin Bank the officers promoted by these banks are dismissed as selection has not been made by these banks in accordance with the principle of 'seniority-cum-merit' by prescribing minimum standard for H 786 SUPREME COURT REPORTS [1998] 3 S.C.R. A assessing the merit. Selection was made by these banks, of officers who secured highest number of marks amongst the eligible officers which virtually amounts to application of the principle of merit-cum- seniority. (801-E] 6.1. In the facts and circumstances, the appeal pertaining to ChhindwaraSeoni Kshentriya Gramin Bank succeeds as minimum standard was B prescribed by the bank for assessing the merit of the candidates and those who fulfilled the said minimum standard were selected for promotion on the basis ofseniority. (804-F-G) CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3798of1996 Etc. C From the Judgment and order dated 23. 9. 94 of the Andhra Pradesh High Court in W.A. No. 422. of 1994 P.P. Rao, R. Venkat Ramani, S.B. Sanyal, H.S. Garurafa Rao Sr. Adv., Ms. C.K. Sucharita, R. Santhanakrishnan, G. Nageshwar Reddy, K.R. Nagaraja, Prakash Srivastava, S.K. Kulkarni, Ms. Sangeeta Kumar, Amrendar Sharan, D Shree Prakas Shina, Ms. Ambika Pratap Singh, Satish k. Agnihotri, Ms. Yogamaya, Ms. Madhur Dadlani, Sandeep Narian, P. Niroop, S. Murlidhar, G. Prabhakar, Amitabh Verma, Ashok Mathur, Anoop Choudhary, Amarendra Sharan, Ms. Pratibha Jain, A.P. Dhamija, O.P. Gaggar, Pramod Swarup, Shiv Sager Tiwari, T.G. Narayanan Nair and P.R. Ramasesh for the appearing parties. E The Judgment of the Court was delivered by S. C. AGRA WAL, J. Leave granted in all Special Petitions. What is meant by "seniority - cum-merit", the criterion prescribed for , F promotion to the post of Area Manager/Senior Manager in the Regional Rural Banks under the Regional Rural Banks (Appointment & Promotions of Officers +- - and Other Employees) Rules, 1988 [hereinafter referred to as 'the Rules'] ? This is the common question which falls for consideration in these appeals. The regional Rural Banks have been established under the provisions G of the Regional Rural Banks Act, 1976 [hereinafter referred to as 'the Act']. Section 17 of the Act empowers a Regional Rural Bank to appoint such number of officers and other officers as it may consider necessary or desirable, in such manner as may be prescribe, for the efficient performance of its functions and to determine the terms and conditions of their appointment and service. Section 24 of the Act lays down that in the discharge of its functions H a Regional Rural Bank shall be guided by such directions, in regard to matters ' B. V. S!VAIAH v. K. AD DANK! BABU [S.C. AGRAWAL, J.] 787 of policy involving public interest, as the Central Government may, after A consultation with the national Bank for Agricultural and Rural Development [hereinafter referred to as 'the National Bank'], give. Under Section 29 of the Act the Central Government has been empowered to make rules, after consultation with the National Bank and sponsor Bank, for carrying out the provisions of the Act, By clause (ba) of sub-section (2) of section 29, which was inserted by the Regional Rural Banks (Amendment) Act, 1987, the Central B Government was empowered to make Rules relating to manner in which the officers and other employees of the Regional Rural Bank shall be appointed. In exercise of the powers conferred under Section 29 read with Section 17 of the Act the Central Government framed the Rules which were published vide Notification dated September 28, 1988. C Rule 3 of the Rules provides that the Board of Directors of each Regional Rural Bank may, in consultation with its sponsor Bank, create such number of posts as are specified in the second schedule to the Rules from time to time. Rule 4 prescribes that the Board of Directors may, in consultation with the sponsor Bank, determine the number of vacancies in each post D keeping in view the guidelines issued by the Central Government from time to time. Rule 5 makes provision for filling of vacancies and provides that all vacancies determined under Rule 4 by the Board of Directors shall be filled by deputation, promotion or direct recruitment in accordance with the provisions contained in the Second Schedule to the Rules. With regard the post of Area/Senior Manager the following provision is made in the Second E Schedule to the Rules:- "7. Area Managers or Senior Managers (a) Source of Recruitment : Hundred per cent by promotion from amongst confirmed officers working F in the bank. Promotions will be on the basis of seniority-cum-merit. If suitable officers are not available internally, these posts could be filled by taking temporarily officers of the G sponsor banks and other banks or organisations on deputation. (b) Qualification & Eligibility : ( i) A Graduate of recognized University or any equivalent qualifications recognized :is such by Government H 788 A B c D SUPREME COURT REPORTS [1998] 3 S.C.R. of India, preference being given to Agriculture or Commerce or Economics graduates. (ii) Eight years service as an officer in the regional rural bank concerned. provided that the Board may, with the prior approval of National Bank, relax the period of service by a period not exceeding two years, if suitable candidates of requisite experience are not available. Note: The post of Area Managers and Senior Managers will be equivalent in rank and will be interchangeable. ( c) Mode of Selection : Interview and assessment of performance reports for the preceding three years period as officer for promotion." E Prior to the making of the Rules appointment on the post of Area/Senior Manager in Regional Rural Banks was governed by circulars issued by the Central Government and the National Bank. By circular dated October I 0, 1987 addressed to the Deputy General manager of the National Bank, the Central Government indicated the criterian that was required to be followed in the matter of promotion of Branch Managers to the post of Area Managers/ .,. F Senior Managers in Regional Rural Banks in the following terms :- ~ G H " ....... It is, therefore, requested that the Chairman of all the RRBs may be apprised that since the posts of Area Managers/Senior Managers are promotional posts to be filled up 100% by promotion from only one source, the non-selection rule of seniority cum merit has to be applied. This rule envisages promotion by seniority with due consideration to minimum merit/fitness prescribed. Fitness implies that there is nothing against the officer. No disciplinary action is pending against him and none is contemplated. The officer has neither been reprimanded nor any adverse remarks have been conveyed to him in the reasonably recent past. The promotions are meant to be 1 -; B.V. SIVAIAH v. K. ADDANKI BABU [S.C. AGRAWAL,J.] 789 made on the above mentioned consideration." A [emphasis supplied ) In accordance with the said circular the National Bank issued a circular dated December I, 1987 whereby all the Regional Rural Banks were apprised that the matter relating to the promotion of Branch Mangers to the posts of B Area/Senior Managers had been examined by it consultation with the Government of India and the Regional Rural Banks were advised as under :- "The posts of Area Managers/Senior Managers are promotional posts to be filled up by 100% promotion from only one source and nonselection rule of seniority-cum-merit has to be applied. This rule C envisages promotion by seniority with due consideration to minimum merit/fitness prescribed. Fitness implies that there is nothing against the officer; no disciplinary action is pending against him and none is contemplated. The officer has neither been reprimanded nor any adverse remarks have been conveyed to him in the reasonably recent past. D The promotions are meant to be made on the above mentioned consideration only. In other words, if a manager satisfies the qualifications and eligibility criteria and there is nothing adverse against him, his due promotion should not be denied to him." These appeals can be categorised in two groups, viz., the Andhra E Pradesh group and the Madhya Pradesh group. The Andhra Pradesh group of appeals are directed against the judgment of the Division Bench of the Andhra Pradesh High Court dated September 23, 1994 in various writ appeals. The Madhya Pradesh group of appeals have been filed against the judgments of the Madhya Pradesh High Court. The main judgment, which has been followed by the said High Court in other cases, is in L.P.A. No. 151of1993 F and connectt:d matters decided on October 9, 1996. In the impugned judgments, the High Courts of Andhra Pradesh and Madhya Pradesh have taken the view that if"seniority -cum-merit criterion is adopted for the purpose or promotion then first the senior most eligible employee has to be tested to find out whether he possesses the minimum required merit for holding the G higher post and only if he is not found suitable or fit, his immediate junior may be tested for the purpose of promotion. The said view has been assailed by the various Regional Rural Banks as well as the promoted officers whose promotions have been set aside by the impugned judgments. In the matter of formulation of a policy for promotion to a higher post, H 790 SUPREME COURT REPORTS [1998) 3 S.C.R. A the two competing principles which are taken into account are inter se seniority and comparative merit of employees who are eligible for promotion. In Sant Ram Sharma v. State of Rajasthan & Ors., [I 968] I SCR I J J, this court has pointed out that the principle of seniority ensures absolute objectivity by requiring all promotions to be made entirely on grounds of seniority and that if a post falls vacant it is filled by the person who had served longest in the B post immediately below. But the seniority system is so objective that it fails to take any account of personal merit. It is fair to every official except the best ones, an official has nothing to win or lose provided he does not actually become so inefficient that disciplinary action has to be taken against him. The criterion of merit, on the other hand, lays stress on meritorious performance C irrespective of seniority and even a person, though junior but much more meritorious his seniors, is selected for promotion. The Court has expressed the view that there should be a correct balance between seniority and merit in a proper promotion policy. The criteria of seniority cum-merit' and 'meritcum-seniority' which take into account seniority as well as merit seek to achieve such a balance. D The principle of 'merit-cum-seniority' lays greater emphasis on merit and ability and seniority plays a less significant role. Seniority is to be given weight only when merit and ability are approximately equal. In the context of Rule 5(2) of the Indian Administrative Service/Indian Police Service E (Appointment by promotion) Regulations, I 955 which prescribed that "selection for inclusion in such list shall be based on merit and suitability in all respects with due regard to seniority" Mathew. J. in Union of India v. Mohan Lal Capoor & Ors., [1974] I SCR 797, has said :- F G H " .... for inclusion in the list, merit and suitability in all respects should be the governing consideration and that seniority should play a secondary role. It is only when merit and suitability are roughly equal that seniority will be a determining factor, or if it is not fairly possible to make an assessment inter se of the merit and suitability of two eligible candidates and come to a firm conclusion, seniority would tilt the scale." [p. 80 l] Similarly, Beg J. (as the learned Chief Justice then was) has said :- "Thus, we think that the correct view, in conformity with the plain meaning of words used in the relevant rules, is that the "entrance" or "inclusion" test for a place on the select list, is competitive and comparative applied to all eligible candidates and not minimal like y • B.V. SIVAIAH v. K. ADDANKIBABU [S.C. AGRAWAL, J.] 791 pass marks at an examination. The Selection Committee has an A unrestricted choice of the best available talent, from amongst eligible candidates, determined by reference to reasonable criteria applied in assessing the facts revealed by service records of all eligible candidates so that merit and not mere seniority is the governing factor." [p.817] On the other hand, as between the two principles of senionty and merit, B the criterion of 'seniority-cum-merit' lays greater emphasis on seniority. In state of Mysore & Anr. v. Syed Mahmood & Ors., [1968] 3 SCR 363, while considering Rule 4(3)(b) of the Mysore State Civil Services General Recruitment Rules, 1957 which required promotion to be made by selection on the basis of seniority-cum-merit, this Court has observed that the rule required promotion C to be made by selection on the basis of "seniority subject to the fitness of the candidate to discharge the duties of the post from among persons eligible for promotion". It was pointed out that where the promotion is based on seniority-cum-merit the officer cannot claim promotion as a matter of right by virtue of his seniority alone and if he is found unfit to discharge the duties of the higher post, he may be passed over and an officer junior to him may D be promoted. In State of Kera/a & Anr. v. NM Thomas & Ors., [1976] 1SCR906, A.N. Ray CJ. has thus explained the criterion of 'seniority-cum-merit':- "With regard to promotion the normal principles are either merit-cum- E seniority or seniority-cum-merit. seniority-cum-merit means that given the minimum necessary merit requisite for efficiency of administration, the senior though the less meritorious shall have priority." [p.930] The learned counsel for the Regional Rural Banks and the promoted officers have, however, placed reliance on Para 7(c) of the Second Schedule F to the Rules which prescribes that the mode of selection for promotion would be interview and assessment of performance reports for the preceding three years periods and have submitted that under the criterion of 'seniority-cummerit', as prescribed under the Rules, comparative merit has to be assessed for the purpose of promotion. Reliance has been placed on the following G observations in State af Mysore v. C.R. Seshadri & Ors., [1974] 3 SCR 87 :- "However, if the criterion for promotion is one of the seniority-cummerit, comparative merit has to be assessed if length of service is equal or an outstanding junior is available for promotion." (p. 89) The learned counsel for the Regional Rural Banks and the promoted H 792 SUPREME COURT REPORTS [1998] 3 S.C.R. A officers have also placed reliance on the decision of this Court in Jagathigowda, C.N. & Ors. v. Chairman, Cauvery Gramina Bank & Ors., [1996] 9 SCC 677. Para 7( c) of the Second Schedule to the Rules does not, in our opinion, lend support to the contention that the criterion of seniority-cum-merit envisaged by the Rule making authority involves assessment of comparative B merit for the purpose of promotion. The word "selection" has been used in the sense of selecting an officer for promotion on the basis of the criterion of seniority-cum-merit. The requirement that such selection shall be made on the basis of interview and assessment of performance reports for the preceding three years is consistent with the criterion of seniority-cum-merit as explained C in the state of Kera/a & Anr. v. NM. Thomas & Ors., (supra) that "given the necessary merit requisite for efficiency of administration" the senior though the less meritorious shall have priority. The said mode enables an assessment to be made about the minimum necessary merit requisite for efficiency of administration and it cannot be construed as importing assessment of comparative merit of the officers eligible for promotion. D In C.R. Seshadri (supra) the Court was considering the question whether the High Court could have given a direction to the State to give to the respondent therein notional promotion to the post of Deputy Secretary with effect from the date on which his junior secured such promotion. This Court E said that such a direction could not be given by the High Court because promotion of a government servant was basically in government's discretionary power and that in the absence of positive proof of the relevant service rules it was hazardous to assume that by efflux of time the respondent would have spiralled upto Deputy Secretaryship and that the proper direction could only be that government would reconsider the case of the respondent afresh for F purpose of notional promotion. In that context, this Court pointed out that if the ruie of promotion is one of 'sheer seniority' it may well be that promotion is a matter of course and that if seniority-cum-merit is the rule, promotion is problematical. Since the relevant rule governing promotion to the post of Deputy Secretary had not been placed before it, the Court was not G required to define the criterion of 'seniority-cum-merit' and to delineate the fine distinction between the criterion of' seniority-cum-merit' and the criterion of 'merit-cum-seniority' in the matter of promotion. In the observations on which reliance has been placed by the learned counsel for the Rural Banks and the promoted officers the distinction between 'seniority-cum-merit' and 'merit-cum-seniority' has been obliterated and both the criterion have been H equated. Since comparative assessment of merit is required to be made while ;· B.V. SIVAIAH v. K. ADDANKI BABU [S.C. AGRAWAL, J.] 793 applying the criterion of 'merit-cum-seniority' and for 'seniority-cum-merit' no A such comparative assessment is required, the aforementioned observations in the case of C.R. Seshadri (supra) on which reliance has been placed cannot be regarded as correctly reflecting as to what is meant by the criterion of 'seniority-cum-merit'. In Jagathigowda, C.N. (supra) this Court was dealing with promotion B made to the post of senior Manager in a rural bank which promotion was made prior to the Rules and was governed by circulars of the National Bank dated December 31, 1984 and April 7, 1986. Circular dated December 31, 1984 provided that promotion to the post of Area Manager/Senior Manager should be on the basis of seniority-cum-merit. By circular dated April 7, 1986 it was C prescribed that selection of the eligible candidates should be based on performance of respective candidates in the bank to be assessed by a Staff Selection Committee after interviewing the candidates. The selection was made by the selection Committee after calling the eligible officers for interview in accordance with their seniority and in the interview the marks were awarded according to the performance appraisal forms. The officers who obtained 85 D marks out of 150 were shortlisted for promotion. The performance appraisal comprised of matters such as dimension of work, general intelligence, job knowledge, initiative and resourcefulness etc. The service record of the officers who assailed the promotion before the High Court was adverse. In the judgment under appeal the High Court had set aside the promotion on the ground that E service record of the recent past should have been taken into consideration and in case there was nothing adverse against an officer he could not be denied promotion on the ground that some other junior to him was more meritorious and that promotions were made on the basis of selection inasmuch as marks were assigned on the basis of performance appraisal and interview. The said judgment of the High Court was reversed by this Court. It was F observed that the circular dated April 7, 1986 issued by the National Bank specifically provided that 'the selection of the eligible candidates should be based on performance of respective candidates in the bank'. It was held that the High Court was not justified in holding that the performance appraisal could not be taken into consideration while considering the officers for G promotion to the higher rank. It was also observed that "while making promotion on the basis of seniority-cum-merit the totality of the service record of the officer concerned has to be taken into consideration". This judgment, in our opinion, does not make a departure from the law laid down by this Court in the earlier judgments explaining the criterion of 'senioritycum-merit' because in this case the selection had been made by taking into H 794 SUPREME COURT REPORTS [1998) 3 S.C.R. A account the seniority as well as performance and performance was appraised by assigning marks on the basis of performance appraisal and interview. Those who secured 85 marks out of 150 marks were shortlisted for promotion which shows that securing 85 marks out of 150 marks was treated as the minimum standard of merit for purposes of promotion and those who satisfied the said minimum standard were selected for promotion on the basis of B seniority. On behalf of the promoted officers it was urged that for the purpose of promotion on the basis of seniority-cum-merit, seniority means the length of service and that among officers who were appointed on the same date and C have the same length of service seniority can have no bearing and promotion has to be made on a comparative assessment of merit of such officers. We are unable to agree. While applying the principle of seniority-cum- merit for the purpose of promotion what is required to be considered is inter se seniority of the employees who are eligible for consideration. Such seniority is normally determined on the basis of length of service, but as between D employees appointed on the same date and having the same length of service, but as between employees appointed on the same date and having the same length of service, it is generally determined on the basis of placement in the select list for appointment. Such determination of seniority confers certain rights and the principle of seniority-cum-merit gives effect to the such rights flowing from seniority. It cannot, therefore, be said that in the matter of E promotion on the basis of seniority-cum-merit seniority has no role where the employees eligible for promotion were appointed on the same date and have the same length of service. We thus arrive at the conclusion that the criterion of 'seniority-cumF merit' in the matter of promotion postulates that given the minimum necessary merit requisite for efficiency of administration the senior, even though less meritorious, shall have priority and a comparative assessment of merit is not required to be made. For assessing the minimum.necessary merit the competent authority can lay down the minimum standard that is required and also prescribe the mode of assessment of merit of the employee who is eligible for G consideration for promotion. ~uch assessment can be made by assigning marks on the basis of appraisal of performance on the basis of service record and interview and prescribing the minimum marks which would entitle a person to be promoted on the basis of seniority-cum-merit. We may now examine whether the aforesaid criterion has been correctly H followed by the concerned Banks in making the impugned promotions. We ' [ B.V. SIVAIAH v. K. ADDANKI BABU [S.C. AGRAWAL, J.) 795 will first take up the Andhra Pradesh group of appeals which have been field A against the judgment of the Andhra Pradesh High Court dated September 23, 1994. These appeals relate to two banks, namely, the Rayalaseema Grameena Bank and the Pinakini Grameena Bank. It Would be convenient to deal with the appeals relating to each bank separately. Rayalaseema Grameena Bank :- In March 1988 the Rayalaseema B Grameena Bank decided to create four posts of senior Managers and four posts of Area Managers. The Senior Managers work in the office whereas the Area Managers work in the field. By circular dated March 3, 1988 the Board of Directors of the Rayalaseema Grameena Bank laid down the following promotion process:- "(A) ELIGIBILITY :- The Officers who have put in 8 (Eight) years of service in the Bank in the cadre of branch Manager as on 3 112-1987 are eligible to be considered for the promotion process. (B) MODALITIES : (a) Seniority (b) Qualif-ication - 45 marks (0.5 marks for each completed month of service over and above the minimum qualifying service) - 5 marks (Minimum qualification applicable c D to the cadre shall not be reckoned) E Post Graduation Diplomat's CAIIB - Part I CAIIB - Part II ( c) Leave - record ( d) Interview - 5 marks - 30 marks ( e) Performance - 65 marks - I mark - l mark - l mark - 2 Marks 02. These promotions will be effective .from !st May, 1988. 03. The eligible candidates will be called for the interview directly (candidates need not submit any application in this. regard)" F G Following the said promotion process eight Branch managers were promoted with effect from May I, 1988 in proceedings dated May 3, 1988. The Branch Managers who were promoted as Area/Senior Managers on May 3, 1988 H 796 SUPREME COURT REPORTS [ 1998) 3 S.C.R. A assumed office and their promotions were not questioned by any employee at that time. After the Rules framed by the Central Government vide Notification dated September 28, 1988 came into force the Rayalaseema Grameena Bank, in September 1989, decided to create five posts of Area/senior Managers and, B by circular dated September 27, 1989, formulated the following promotion process for filling up of these five posts: - c D E F G "I. ELIGIBILITY: All the Officer (Branch Managers) who have joined the service of the Bank on or before 1-4-1981 are eligible to be considered for the promotion process. 2. MODALITIES : (a) Seniority (b) Qualifications - 34 marks ( 0.75 mark for each completed month of service over and above the minimum qualifying service) - I 0 marks (Minimum qualification applicable to the cadre shall not be reckoned) Post Graduation - 3 marks Double Graduation - I mark (like BL, LLB, B.ED.) Any Diploma/s. - 2 marks CAIIB - Part I - 2 marks CAIIB - Part II - 2 marks (c) Interview - 20 marks ( d) Perfonnance - 56 marks All the eligible candidates will be called for the interview directly. (Candidates need not submit any applications in this regard)." Following that process, five Branch managers were promoted -two as Area Managers and three as Senior managers - in the proceedings dated December H 1, 1989. • ... [ B.V. SIV AIAH v. K. ADDANKJ BABU [S.C. AGRAWAL, J.] 797 Promotions made in the proceedings dated December 1, 1989 were A challenged before the Andhra pradesh high court by one K.V.T. Prasanna Kumar (by filing Writ Petition No. 17263 of 1989 on December II, 1989), G. Anantha Raju, P. Sainath Reddy and C. Vijayakumar Reddy (by filing Writ Petition No. 17279of1989 on December 12, 1989) and P.V. Krishna Murthy (by filing Writ Petition No. 3546of1990 on February 16, 1990). During the pendency of the said writ petitions P.V. Krishna Murthy filed another Writ B Petition (Writ Petition No. 9692of1993) on July 13, 1993 in the High Court wherein he assailed the promotions made on May 3, 1988 but none of the candidates promoted during the year 1988 to the posts of Area/Senior Manager was impleaded as party respondent. All the four Writ Petitions were heard together by a learned single judge of the High Court who, by his judgment C dated September 7, 1993, allowed Writ Petitions Nos. 17263 and 17279of1989 and 3546 of 1990 and declared that the promotions made on December 1, 1989 to the post of Area/Senior managers from the post of Branch Manager in the Rayalaseema Grameena Bank were illegal and improper. Writ petition No. 9692 of 1993 filed by P.V. Krishna Murthy, in which the promotions made on May 3, 1988 the 1988 were assailed, was, however, dismissed on the ground of D !aches. Against the said judgement of the learned single judge Writ Appeals Nos. 1242of1993, 1232of1993 and 1238of1993 were filed by the Chainnan, Rayalaseema Grameena Bank, and Writ Appeals Nos. 1233of1993 and 1234 of 1993 were filed by the five Branch Managers whose promotions as Areal Senior Managers made on December 1, 1989 had been quashed by the learned E single Judge. Writ Appeals Nos. 1142of1993 and 1224of1993 were filed by P.V. Krishnamurthy, the petitioner in Writ Petition No. 3546of1990 and Writ Petition No. 9692of1993 and Writ Appeal No. 1210of1993 was filed by two of the petitioners in Writ Petition No. 17279 of 1989. These appeals related to the promotions made on May 3, 1988. F In Writ Appeal No. l l