The court by its recent judgment decided the Union government's appeals concerning the interpretation and implementation of the MACP Scheme, which has been in effect since September 1, 2008.

 

The Assured Career Progression Scheme (ACPS) which was introduced with effect from August 9, 1999, and continued to remain in force till August 31, 2008, envisaged financial upgradations on completion of 12 years and 24 years of regular service without one or two promotions, as the case may be, whereas the MACPS envisaged three financial upgradations after completion of regular service of 10, 20, and 30 years without promotions and continuing on the same Grade Pay for a decade.

 

Also, the financial upgradation under the ACPS was to the pay scale of the next higher promotional post in the service whereas, under the MACPS, financial upgradation was not with reference to the next higher promotional post but to the next higher grade pay in the scale of pay, as notified upon implementation of the Central Civil Services (Revised Pay) Rules, 2008, the court noted.

 

In the present case, upon implementation of the Central Civil Services (Revised Pay) [CCS RP] Rules, some of the respondents who were working as Pharmacists in the Ordnance Factory, and the others, who were working as Superintendents in the Central Board of Excise, became entitled to non-functional upgradation, on completion of two or four years of service respectively, in Pay Band (PB)-2 with Grade Pay of Rs 4200 and PB-2 with Grade Pay of Rs 5400 respectively. The earlier pay scale, before the grant of non-functional financial upgradation, was with the Grade Pay of Rs 2800 and 4800 respectively.

 

After a careful reading of the clauses/provisions of MACPS, the court noted that its objective purpose was that an employee should not remain stagnant in the same pay scale/Grade Pay for periods of 10, 20, or 30 years. In such cases, the employee would be entitled to financial upgradation to the immediate next higher Grade Pay, as mentioned in Section 1, Part-A of the first Schedule to the CCS RP Rules.

 

The court pointed out that the emphasis in clause 1 is on the expression “Grade Pay”. Clause 2, similarly, states that the benefit under the MACPS is available where the eligible employee has not got regular promotion. In such cases, he/she will be given financial upgradation. However, such financial upgradation is not the same as a pay-scale/Grade Pay, which is applicable to the next promotional post in the hierarchy of the concerned cadre/ organisation, court emphasised.

 

It noted that Clause 5 states that the promotions earned/financial upgradations granted under the ACPS in the past shall be taken into account, but where there has been a merger of pay scales/upgradation of posts recommended by the Sixth CPC, they shall be ignored for the purpose of granting upgradation under the MACPS.

 

"At this stage, we would like to clarify that clause 5 will not be applicable to the cases in question. This is not a case of merger of pay-scales or upgradation of posts. On the other hand, this is a case wherein non-functional higher Grade Pay has been awarded to employees on completion of a certain length of service in the lower pay-scale/Grade Pay," the bench observed.

 

Allowing the Union government's appeals, the bench rejected the contention of the respondents that on implementation of the CCS RP Rules, upgrading the pay of Pharmacists and Superintendents, post the period of two or four years, would only amount to re-fixation of pay or revision of pay, as incorrect and, in essence, a wrong understanding of the CCS RP Rules.

 

It also pointed out that Clause 6.2 specifically states that, where financial upgradation has been granted to the next higher pay-scale/Grade Pay in the hierarchy in the cadre as per the provisions of the ACPS, but as a result of the implementation of the Sixth CPC by grant of higher pay-scale/Grade Pay, the pay of such employees has been revised, such benefit will be given to the said employees.

 

However, the court clarified that from the date of implementation of the MACPS, all financial upgradations would be done under the MACPS strictly in accordance with the hierarchy of the Grade Pay in the Pay Band, as notified vide CCS RP Rules.

 

“Regular service” for the purpose of MACPS, commences from the date of joining the post in the direct entry grade on a regular service basis either on a direct recruitment basis or on an absorption/re-employment basis, court stressed.

 

It also noted that Clause 13 of the MACPS states that any time-bound promotion scheme, including in-situ promotion scheme, which is in force, may continue to be in operation for the concerned category of employees if it is decided by the concerned administrative authorities to retain such schemes.

 

"However, such schemes cannot run concurrently with the MACPS. The objective is clear. An incumbent eligible Government employee should not take the benefit of both - the time bound promotion scheme or in-situ promotion scheme as well as the benefit of financial upgradation under the MACPS," the bench said.

 

"We have specifically referred to clause 13 for, in our opinion, the financial upgradation which is granted, after two or four years of service, to Pharmacists or Superintendents, would indicate that they availed financial upgradation. In their cases, because of service conditions, the Government had thought it proper to grant them such financial upgradation after they completed two or four years of service in the lower pay-scale/Grade Pay," the bench added.

 

The court also noted that it is not the intention of the Government to ignore the said upgradation under the CCS RP Rules.

 

"If we do so, we would be granting them additional benefits beyond what was envisaged and stated in the MACPS. The Revised Pay Rules, including a grant of financial benefits, and the MACPS are not two watertight or separate compartments, each conferring independent benefits without reference to the other," the bench said.

 

The court noted that grant of financial upgradations as well as promotions are to be duly accounted for and taken into consideration in the MACPS.

 

Referring to Clauses 19 and 20, the court said those specified that the financial upgradation is purely personal and has no relevance to the seniority position. Grade Pay/grant of financial benefits shall not amount to actual or functional promotion of the employees concerned. Roster point etc will not be applicable, it said.

 

Clause 21 states that the pay drawn in the Pay Band and Grade Pay allowed under the MACPS would be taken as the basis for determining the terminal benefits in respect of the retiring employees, it pointed out.

 

Therefore, the bench said, "We fail to understand how we can ignore the financial upgradation, which was granted upon completion of two or four years of service in the posts of Pharmacist or Superintendent, as the case may be, for the purpose of deciding as to whether or not the Government employee would be entitled to the next financial benefit under the MACPS. To ignore the financial upgradation granted on completion of two or four years of service as Pharmacists or Superintendents, would be contrary to the intent and purpose of the scheme and the language employed".

 

The court opined that no doubt, certain anomalies may arise because of the fact that the ACPS and MACPS did operate during different periods; the nature of financial upgradations was different; and the time periods specified for financial upgradation were different.

 

But this cannot be a ground and reason to re-write or ignore the expressed language of the MACPS and the intent and purpose behind the scheme, the bench said.

 

"We have no difficulty in accepting the present appeal and setting aside the impugned judgments. Hence, we allow the present appeals," the bench held.

 

It further held that the respondents would be entitled to the benefits of the MACPS only after taking into consideration all the financial upgradations earned by them, in terms of the CCS RP Rules.

 

"Financial upgradations under the said Rules have to be accounted for and will be treated as financial upgradations earned for the purpose of reckoning the 10-year intervals and the three assured financial upgradations, in terms of Grade Pay, under the MACPS," the bench said.

 

The court was informed that, in the present case, the Government of India had implemented and executed the MACPS by granting benefits to the respondents and, later on, recoveries were initiated.

 

Relying upon the State of Punjab and Others Vs Rafiq Masih (White Washer) and Others, the bench directed Union of India will not effect any recovery of arrears from the retirees or those who are retiring within one year from the date of pronouncement of this judgment.

 

"In other cases, the recoveries may be made after issuing notice to the employee concerned, whose request for proportionate recovery over a period of time not exceeding two years, may be considered depending upon the quantum of recovery which is to be made. We also deem it appropriate to direct that the appellant, Union of India, will not charge interest on the amount to be recovered as they themselves had made the payment and, the issue being debatable, to ask the employees to pay interest at this distant point of time may lead to difficulty both in calculation as well as in payment," the bench said.

 

The court clarified that the pension and the pay scale, which are payable should be re-determined on the basis of the present judgment and will apply prospectively with effect from January 01, 2025.

 

"Where recoveries have been made from the retirees, the same shall be refunded. However, in the case of serving employees, where recoveries have been made, the same need not be refunded," the court directed.

 

It also clarified that it did not madke any comments or observations on any petition or appeal, filed challenging the validity and legality of Clause 8.1 of the MACPS.