Service Regulations Would Prevail Over Advertisement In Case Of Conflict- SC Upholds ESIC Recruitment Regulations Over DACP Scheme

In this case, Respondents 3 to 25 joined the Appellant i.e. the Employee's State Insurance Corporation as Assistant Professors at the ESIC Model Hospital, The Central Government, through the Central Health Service Division of the Ministry of Health and Family Welfare, had issued the DACP Scheme through an Office Memorandum. The DACP Scheme had contemplated promotion as Associate Professor upon completion of two years of service in the post of Assistant Professor as an officer under the Ministry of Health and Family Welfare.

After two years of service as Assistant Professor, the contesting respondents sought promotion under the DACP Scheme and instituted proceedings before the Central Administrative Tribunal, Bengaluru. The CAT held that the ESIC Recruitment Regulations 2015 were not relevant for adjudication of the matter and directed the Appellant to consider the contesting respondents for promotion under the DACP Scheme The Appellant challenged the order of the CAT before the Karnataka High Court which dismissed the petition. This impugned judgment had been challenged before the Supreme Court.

The primary issue in this case was –

• Whether the DACP Scheme or the ESIC Recruitment Regulations 2015 will be applicable to the contesting Respondents?

It was contended by the Appellants that Section 97 of the ESI Act conferred power on the Appellant to frame its own regulations. Thus, the terms and conditions of service of Assistant Professors were to be governed by the ESIC Recruitment Regulations, 2015. It was argued that the 2015 Regulations could not be overridden by the DACP Scheme. It was also claimed that Section 17(2) permitted the ESIC to depart from the conditions of service applicable to employees of the Central Government, subject to prior approval of the Central Government. Moreover, Section 97(3) empowered the ESIC to frame regulations that are deemed to have the same effect as statutory provisions. Thus, it was contended that It is settled law that in the event of an inconsistency or conflict between a statutory provision and an executive instruction, the former must be given effect. Hence, it was submitted that the 2015 Regulations were applicable.

The Respondents claimed that the Office Memorandum extended the DACP Scheme to all Medical doctors, whether belonging to Organized Services, or holding isolated posts. Thus, under Section 17(2)(a) of the ESI Act, the DACP Scheme was binding on the Appellant. It was argued that the ESIC Recruitment Regulations 2015 were issued without obtaining prior approval from the Central Government. It was contended that since The Appellant had issued advertisements for the post of Assistant Professor and hence, it was submitted that the DACP Scheme were applicable. Moreover, the counsel for the Appellant had taken a stance that the DACP Scheme will be applicable before the Central Administrative Tribunal.

The Supreme Court referred to Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi and observed that the ESIC Recruitment Regulations 2008 and ESIC Recruitment Regulations 2015 had statutory effect by virtue of Section 97(3) of the ESI Act. Thus, they held that the regulations framed by statutory authorities had the force of enacted law. Moreover, it was observed that in the event of a conflict between an executive instruction, an office memorandum in this case, and statutory regulations – the latter would prevail as per the judgment in the case of Sant Ram Sharma v. State of Rajasthan. Hence, it was held that an office order or office memorandum could not contravene or be given primacy over statutory rules.

Here, the Court observed that the contesting Respondents had referred to certain letters and to an internal communication of the Appellant to urge that the DACP Scheme was to be implemented for promotions at the Appellant. However, these letters, similar to the Office Memorandum implementing the DACP Scheme, would not have the force of law until they were enforced through an amendment to the recruitment regulations as per the case of Union of India v. Majji Jangamayya. Moreover, the Court held, that it was a settled principle of service jurisprudence that in the event of a conflict between a statement in an advertisement and service regulations, the latter shall prevail as per Malik Mazhar Sultan v. U.P. Public Service Commission.

In the case at hand, the Court opined, "When the contesting respondents had completed two years of service, they were governed by the ESIC Recruitment Regulations 2015 which came into effect on 5 July 2015 and mandated five years of qualifying service for promotion from Assistant Professor to Associate Professor. Thus, the DACP Scheme facilitating promotion on the completion of two years of service is not applicable to the contesting respondents, when the regulations have a statutory effect that overrides the Office Memorandum dated 29 October 2008 which implemented the DACP Scheme."

With respect to the contention that the counsel for the Appellant had taken a stance that the DACP Scheme will be applicable before the Central Administrative Tribunal, the Court expressed its disapproval at the lack of proper instructions being tendered to the Counsel of the Appellant. However, the Court observed there could not be any estoppel against a statute or regulations having a statutory effect, irrespective of the concession of its Counsel since it was on a point of law, as per the case of Nedunuri Kameswaramma v. Sampati Subba Rao. Additionally, as per Director of Elementary Education, Odisha v. Pramod Kumar Sahoo, it was asserted that a concession on a question of law concerning service rules would not bind the State. Hence, the concession of the Counsel for the Appellant before the CAT did not preclude the finding on the law by the Court.

Thus, the appeal was accordingly allowed and the impugned judgment and order of the Division Bench of the Karnataka High Court was set aside. The Court directed the seniority list of the Teaching Cadre at the Appellant Corporation to be revised in order to reflect the promotions of the contesting Respondents in accordance with the ESIC Recruitment Regulations, 2015 and not the DACP Scheme.