Customs Act, 1962 – ss.75A, 27A – Central Excise Act, 1944 – Foreign Trade (Development and Regulation) Act, 1992 – Foreign Trade (Regulation) Rules, 1993 – Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 – Exim Policy of 1992-1997 – Duty Exemption Scheme – Duty Drawback Scheme – Supplies in civil construction work, eligibility for ‘deemed export’ benefit under the Exim Policy – Respondent, a class-I contractor specializing in the field of civil contract works especially funneling and hydro-electric power projects had completed the work awarded to it in 1996 in a project called Koyna Hydro Electric Power Project, Maharashtra funded by the International Bank for Reconstruction and Development, an arm of the World Bank – Respondent claimed duty drawback and interest for the delayed refund thereof – Entitlement:

* Author

[2024] 2 S.C.R. 91 : 2024 INSC 83

Union of India and Ors.

v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

(Civil Appeal Nos. 7238 of 2009)

05 February 2024

[Abhay S. Oka and Ujjal Bhuyan,* JJ.]

Issue for Consideration

Entitlement of the respondent to refund of duty drawback and

interest for delayed payment thereof.

Headnotes

Customs Act, 1962 – ss.75A, 27A – Central Excise Act, 1944

– Foreign Trade (Development and Regulation) Act, 1992 –

Foreign Trade (Regulation) Rules, 1993 – Customs, Central

Excise Duties and Service Tax Drawback Rules, 1995 – Exim

Policy of 1992-1997 – Duty Exemption Scheme – Duty Drawback

Scheme – Supplies in civil construction work, eligibility for

‘deemed export’ benefit under the Exim Policy – Respondent,

a class-I contractor specializing in the field of civil contract

works especially funneling and hydro-electric power projects

had completed the work awarded to it in 1996 in a project called

Koyna Hydro Electric Power Project, Maharashtra funded by

the International Bank for Reconstruction and Development, an

arm of the World Bank – Respondent claimed duty drawback

and interest for the delayed refund thereof – Entitlement:

Held: On a conjoint reading of the relevant provisions of the Exim

Policy, 1992-1997 in conjunction with the Central Excise Act and

the Customs Act, it is evident that supply of goods to the project

in question by the respondent was a case of ‘deemed export’ and

thus entitled to the benefit under the Duty Drawback Scheme – The

language employed in the policy made this very clear and there

was no ambiguity in respect of such entitlement – Even if there

was any doubt, the same was fully explained by the 1995 Rules –

It is not correct on the part of the appellants to contend that there

was no provision for payment of interest on delayed refund of

duty drawback – It is also untenable for the appellants to contend

that refund of duty drawback was granted to the respondent as a

concession, not to be treated as a precedent – Respondent entitled 

92 [2024] 2 S.C.R.

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to refund of duty drawback as a deemed export under the Duty

Drawback Scheme – Applications for refund were made in 1996

– Decision to grant refund of duty drawback was taken belatedly

on 07.10.2002 whereafter the payments were made by way of

cheques on 31.03.2003 and 20.05.2003 – Admittedly, there was

considerable delay in refund of duty drawback – Under s.75A(1)

of the Customs Act, where duty drawback is not paid within three

months from the date of filing of claim, the claimant would be entitled

to interest in addition to the amount of drawback – It provides that

the interest would be at the rate fixed u/s.27A from the date after

expiry of the said period of three months till the payment of such

drawback – The interest rate prescribed u/s.27A at the relevant

point of time was not below ten percent and not exceeding thirty

percent per annum – The Central Board of Excise and Customs vide

its notification bearing No.32/1995 (NT)- Customs dtd. 26.5.1995

had fixed the rate of interest at fifteen percent for the purpose of

s.27A – Since there was belated refund of the duty drawback to

the respondent, it was entitled to interest at the rate which was

fixed by the Central Government at the relevant point of time being

fifteen percent – Order of the Division Bench of the High Court

not interfered with. [Paras 33-39]

Case Law Cited

S. S. Grewal v. State of Punjab [1993] 3 SCR 593 : 1993

Suppl. 3 SCC 234; Rajagopal Reddy (dead) by Lrs. v.

Padmini Chandrasekharan (dead) by Lrs. [1995] 1 SCR

715 : (1995) 2 SCC 630; Zile Singh v. State of Haryana

[2004] 5 Suppl. SCR 272 : (2004) 8 SCC 1 – referred to.

List of Acts

Central Excise Act, 1944; Customs Act, 1962; Finance Act,

1994, Imports and Exports (Control) Act, 1947; Foreign Trade

(Development and Regulation) Act, 1992; Foreign Trade

(Regulation) Rules, 1993; Customs, Central Excise Duties and

Service Tax Drawback Rules, 1995.

List of Keywords

Drawback; Duty drawback; Duty Drawback Scheme; Exim Policy

of 1992-1997; Duty Exemption Scheme; Deemed export; Delayed

refund of duty drawback; Interest; Multilateral or bilateral agencies;

International Bank for Reconstruction and Development; World Bank;

Central Board of Excise and Customs; Imports of duty free material;

Notification declaratory/clarificatory; Retrospective operation.

[2024] 2 S.C.R. 93

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

Case Arising From

CIVIL APPELLATE JURISDICTION : Civil Appeal No.7238 of 2009

From the Judgment and Order dated 22.08.2008 of the High Court

of Karnataka at Bangalore in WA No.356 of 2006

Appearances for Parties

V C Bharathi, Raj Bahadur Yadav, Shashank Bajpai, Mrs. Sweta

Singh Verma, A. K. Kaul, Praneet Pranab, Advs. for the Appellants.

Basuva Prabhu Patil, Sr. Adv., Amit Sharma, Dipesh Sinha, Ms.

Pallavi Barua, Ms. Aparna Singh, Advs. for the Respondent.

Judgment / Order of the Supreme Court

Judgment

Ujjal Bhuyan, J.

Appellants i.e., Union of India, Director General of Foreign Trade and

Joint Director General of Foreign Trade by means of this civil appeal

have taken exception to the judgment and order dated 22.08.2008

passed by a Division Bench of the High Court of Karnataka, Circuit

Bench at Dharwad in Writ Appeal No.356 of 2006 affirming the

judgment and order of the learned Single Judge dated 22.09.2005

allowing Writ Petition No.45525 of 2004 filed by the respondent.

2. Facts lie within a narrow compass. Nonetheless, for a determination

of the lis, it would be necessary to briefly narrate the relevant facts

as projected by the respondent in the related writ petition.

2.1. Respondent is a class-I contractor specializing in the field of

civil contract works especially funneling and hydro electric

power projects.

2.2. Central Government had approved funding of a project called

Koyna Hydro Electric Power Project, Maharashtra by the

International Bank for Reconstruction and Development, which

is an arm of the World Bank. In the said project, respondent

was awarded a sub-contract to execute civil works from Lake

Intake to the Emergency Valve Tunnel. Respondent has relied

upon a letter dated 08.08.1991 issued by the Chief Engineer

of the project. Relevant portion of the letter reads thus:-

94 [2024] 2 S.C.R.

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4.2. Information regarding the benefits available

under the “Deemed Export” concept for this World

Bank Aided (Loan) Project may please be obtained

by the contractors from their own sources and the

information gained by them may be utilised, while

quoting the rates.

2.3. A deemed export scheme was announced under the Exim

Policy, 1992-1997 by the Ministry of Commerce, Government

of India and the Director General of Foreign Trade under the

Foreign Trade (Development and Regulation) Act, 1992. Certain

benefits under ‘deemed export’ were also included in the said

Exim Policy.

2.4. Respondent completed the construction work awarded to it in

the month of March, 1996 and thereafter filed applications dated

25.03.1996, 13.09.1996 and 20.12.1996 claiming duty drawback

for Rs.35,75,679.00, Rs.88,98,206.00 and Rs.85,05,853.00

respectively.

2.5. By endorsements dated 10.11.1996, 06.12.1996 and 31.12.1996,

Director General of Foreign Trade (for short ‘DGFT’ hereinafter)

rejected the applications of the respondent for duty drawback

on the ground that supplies in civil construction work were not

eligible for ‘deemed export’ benefit.

2.6. Notwithstanding such rejection, respondent made representations

for reconsideration of such decision and sought for duty drawback

under the Exim Policy, 1992-1997. One such representation is

dated 05.02.1997. However, the same was rejected by the DGFT

vide the order dated 10.08.1997 stating that civil construction

work did not qualify for drawback.

2.7. On 20.08.1998, DGFT issued a circular under the successor

Exim Policy, 1997-2002 clarifying that supply of goods under

paragraph 10(2)(d) of the 1997-2002 Exim Policy would be

entitled for ‘deemed export’ benefit. It may be mentioned that

the Exim Policy of 1992-1997 had expired with effect from

31.03.1997.

2.8. On 05.12.2000, DGFT issued a circular that drawback was to

be paid in respect of excise duty on supply of goods to projects

funded by multilateral agencies. 

[2024] 2 S.C.R. 95

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

2.9. In the above scenario, respondent once again addressed

a letter dated 28.08.2001 to the DGFT to finalize the issue.

However, DGFT rejected the claim vide the communication

dated 21.06.2002.

2.10.Notwithstanding the same, a Policy Interpretation Committee

was constituted which examined the case of the respondent in

its meeting held on 07.10.2002. It was decided that the benefit

of duty drawback under the ‘deemed export’ scheme would be

extended to the respondent. Consequently, in supersession of

the earlier rejection order dated 21.06.2002 and in the light of the

decision of the Policy Interpretation Committee dated 07.10.2002,

DGFT vide the order dated 01.11.2002 permitted duty drawback

of Rs.2,05,79,740.00 to the respondent. Thereafter cheques

for Rs.25,00,000.00, Rs.63,23,575.00, Rs.81,05,583.00 and

Rs.56,50,312.00, totalling Rs.2,25,79,470.00 vide endorsements

dated 31.03.2003 and 20.05.2003 were issued. However, it was

clarified that duty drawback granted to the respondent would

not be treated as a precedent.

2.11.Respondent thereafter submitted representation addressed

to the appellants dated 06.06.2003, 14.06.2003, 17.07.2003,

29.10.2003 and 10.08.2004 seeking interest on the duty

drawback amount paid on the ground of delayed payment.

However, the request for interest made by the respondent was

rejected by the DGFT.

3. Aggrieved by rejection of the request for interest on the amount

of duty drawback paid, respondent preferred a writ petition before

the High Court which was registered as Writ Petition No.45525 of

2004. After hearing the parties, a learned Single Judge of the High

Court vide the judgment and order dated 22.09.2005 referred to the

notification dated 05.12.2000 and held that respondent was entitled

for duty drawback. After observing that there was delay in payment

of duty drawback, learned Single Judge held that respondent would

be entitled to interest for delayed payment of duty drawback. Since

Customs Act, 1962 provides that interest has to be paid in such a

case in the range of five percent to thirty percent, learned Single

Judge awarded interest at the rate of fifteen percent. Consequently,

directions were issued to the appellants to consider the claim of

the respondent for payment of interest on delayed refund from the

date of notification dated 05.12.2000 till the date of payment to the

respondent within a period of three months. 

96 [2024] 2 S.C.R.

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4. This judgment and order of the learned Single Judge came to be

assailed by the appellants before the Division Bench of the High Court

which was registered as Writ Appeal No.356 of 2006. Respondent

also filed Writ Appeal No.3699 of 2005 assailing the direction of

the learned Single Judge to pay interest only from 05.12.2000. The

Division Bench took note of the fact that since duty drawback was

refunded by the appellants to the respondent, the only question to

be considered was the entitlement of the respondent to interest for

the delayed refund. In this connection, the Division Bench examined

the notification dated 20.08.1998 and observed that this notification

had clarified that ‘deemed export’ would include goods and services

of civil construction projects. Thus, duty drawback under the Exim

Policy in force was extended even to civil construction. This position

was further clarified by the subsequent notification dated 05.12.2000.

Such notification was held by the Division Bench to be clarificatory

in nature, thus having retrospective effect. After referring to Sections

27A and 75A of the Customs Act, 1962, the Division Bench held that

respondent would be entitled to interest after expiry of three months

from the date of making the applications for refund of duty drawback.

Vide the judgment and order dated 22.08.2008, the Division Bench

opined that respondent would be entitled to interest from the date

of expiry of three months after submitting the applications for refund

of duty drawback in the year 1996 at the rate of fifteen percent

as awarded by the learned Single Judge. While the writ appeal of

the respondent was allowed, the writ appeal of the appellants was

dismissed.

5. Mr. V. C. Bharathi, learned counsel for the appellants submitted a short

list of dates and events. He pointed out therefrom that applications

filed by the respondent for duty drawback were repeatedly rejected

by the DGFT. Notwithstanding such rejection, respondent continued

to file one representation after the other claiming duty drawback.

It is in such circumstances that a Policy Interpretation Committee

was constituted by the DGFT which examined the case of the

respondent and vide its decision dated 07.10.2002 decided to extend

the benefit of duty drawback to the respondent as a special case. It

is in this backdrop that DGFT had passed order dated 01.11.2002

emphasizing that the duty drawback paid to the respondent would

not be treated as a precedent. He submitted that duty drawback was

extended to the respondent as a special case which was not available

to the respondent under the Exim Policy of 1992-1997. In such 

[2024] 2 S.C.R. 97

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

circumstances, question of awarding any interest to the respondent

on the ground of alleged delay in payment of duty drawback did not

arise. There was no provision under the Exim Policy of 1992-1997

for payment of such interest. Therefore, learned Single Judge erred

in awarding interest to the respondent, that too, at the high rate of

fifteen percent.

5.1. He further argued that the Division Bench had fallen in error taking

the view that circulars dated 20.08.1998 and 05.12.2000 were

clarificatory in nature and therefore would have retrospective

effect covering the case of the respondent. According to him,

these circulars were issued under the successor Exim Policy,

1997-2002 and thus could not be applied to cases like that of

the respondent under the Exim Policy 1992-1997. He, therefore,

submitted that the present is a fit case for interfering with the

decision of the learned Single Judge as affirmed by the Division

Bench.

6. Per-contra, Mr. Basuva Prabhu Patil, learned senior counsel for the

respondent supported the orders of the learned Single Judge and

that of the Division Bench. He submitted that the appellants having

granted the benefit of duty drawback to the respondent though

belatedly, it is not open to them to now contend that respondent

was not entitled to such duty drawback which was only granted as a

concession. Admittedly, there was delay in refund of duty drawback.

Respondent is, therefore, entitled to interest on such delayed refund

which was rightly awarded by the High Court.

6.1. Referring to the provisions of Section 27A of the Customs Act,

1962 (referred to as the ‘Customs Act’ hereinafter), learned

senior counsel submitted that the High Court had taken a rather

conservative figure considering the legislative scheme while

awarding interest at the rate of fifteen percent to the respondent.

He, therefore, submitted that no interference would be called

for in the orders of the High Court and that the civil appeal filed

by the appellants should be dismissed.

7. Submissions made by learned counsel for the parties have received

the due consideration of the Court.

8. Before we examine the decisions of the High Court, it would be

apposite to briefly highlight the statutory framework and the concerned

Exim Policy. 

98 [2024] 2 S.C.R.

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9. Section 11A of the Central Excise Act, 1944 (briefly ‘Central Excise

Act’ hereinafter) deals with recovery of duties not levied or not paid

or short-levied or short paid or erroneously refunded. Relevant for

our purpose is sub-section (1) which says that where any duty of

excise has not been levied or not paid or has been short levied or

short paid or erroneously refunded, for any reason other than the

reason of fraud or collusion etc. with intent to evade payment of

duty, the Central Excise Officer shall serve notice on the person so

chargeable within two years from the relevant date requiring him

to show cause why he should not pay the amount specified in the

notice. The person chargeable with duty may either before service

of notice pay on the basis of his own ascertainment or the duty

ascertained by the Central Excise Officer, the amount of duty along

with interest payable thereon under Section 11AA. In the event of

fraud, collusion etc. the notice period gets extended to five years.

9.1. Duty is cast upon the person liable to pay duty either voluntarily

or after determination under Section 11A to pay interest in

addition to the duty under sub-section (1) of Section 11AA.

As per sub-section (2), such interest shall not be below ten

percent and shall not exceed thirty six percent per annum,

as the Central Government may by notification in the Official

Gazette fix. Such interest shall be calculated from the date on

which the duty becomes due up to the date of actual payment

of the amount due.

9.2. Section 11B of the Central Excise Act entitles any person

claiming refund of any duty of excise and interest to make an

application for refund of such duty and interest before the expiry

of one year from the relevant date (prior to 12.05.2000, it was

six months instead of one year).

9.3. Section 11BB provides for interest on delayed refund. It says

that if any duty ordered to be refunded under sub-section (2)

of Section 11B to any applicant is not refunded within three

months from the date of receipt of the application under subsection (1) of that section, there shall be paid to such applicant

interest at such rate not below five percent and not exceeding

thirty percent per annum as for the time being fixed by the

Central Government, by notification in the Official Gazette. Prior

to 11.05.2001, the rate of interest was not below ten percent. 

[2024] 2 S.C.R. 99

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

The applicant would be entitled to interest after expiry of three

months from the date of receipt of such application till the date

of refund of such duty.

10. Section 27 of the Customs Act deals with claim for refund of duty.

As per sub-section (1), any person claiming refund of any duty or

interest paid by him or borne by him, may make an application in

the prescribed form and manner, for such refund addressed to the

designated authority before the expiry of one year from the date of

payment of such duty or interest. Explanation below sub-section (1)

clarifies that for the purpose of sub-section (1), the date of payment

of duty or interest in relation to a person, other than an importer,

shall be construed as the date of purchase of goods by such person.

10.1.Sub-section (2) says that if on the receipt of such application

the designated authority is satisfied that the whole or any part

of the duty and interest, if any, paid on such duty, paid by the

applicant is refundable, he may make an order accordingly and

the amount so determined shall be credited to the Consumer

Welfare Fund established under Section 12C of the Central

Excise Act. However, as per the proviso, the amount of duty and

interest so determined shall be paid to the applicant instead of

being credited to the Consumer Welfare Fund if such amount is

relatable, amongst others, to drawback of duty payable under

Sections 74 and 75 of the Customs Act.

11. Section 27A of the Customs Act provides for interest on delayed

refund. It says that, if any duty ordered to be refunded under subsection (2) of Section 27 to an applicant is not refunded within three

months from the date of receipt of the application, there shall be paid

to that applicant interest at such rate not below five percent and not

exceeding thirty percent per annum as is for the time being fixed

by the Central Government, by notification in the Official Gazette,

on such duty from the date immediately after the expiry of three

months from the date of receipt of such application till the date of

refund of such duty.

12. Chapter X of the Customs Act comprising of Sections 74 to 76 deals

with drawback. While Section 74 allows drawback on re-export of

duty-paid goods, Section 75 provides for drawback on imported

materials used in the manufacture of goods which are exported. On

the other hand, Section 75A deals with interest on drawback. Sub-

100 [2024] 2 S.C.R.

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section (1) of Section 75A says that, where any drawback payable

to a claimant under Section 74 or Section 75 is not paid within a

period of one month (earlier it was two months and prior thereto

it was three months) from the date of filing a claim for payment of

such drawback, there shall be paid to that claimant in addition to

the amount of drawback, interest at the rate fixed under Section 27A

from the date after the expiry of the said period of one month till the

date of payment of such drawback.

13. In exercise of the powers conferred under Section 3 of the Imports

and Exports (Control) Act, 1947, the Central Government notified the

Export and Import (Exim) Policy for the period 1992-1997. It came

into effect from 01.04.1992 and remained in force for a period of

five years up to 31.03.1997.

14. After the enactment of The Foreign Trade (Development and

Regulation) Act, 1992, the Exim Policy, 1992-1997 was deemed to

have been made under the aforesaid Act. That being the position,

we will briefly refer to the said enactment.

15. The Foreign Trade (Development and Regulation) Act, 1992 (briefly

‘the 1992 Act’ hereinafter) is an act to provide for the development

and regulation of foreign trade by facilitating imports into and

augmenting exports from India and for matters connected therewith

or incidental thereto.

15.1.Section 4 declares that all orders made under the Imports and

Exports (Control) Act, 1947 and in force immediately before the

commencement of the 1992 Act shall so far as they are not

inconsistent with the provisions of the 1992 Act would continue

to be in force and shall be deemed to have been made under

the 1992 Act.

15.2.Thus, by virtue of Section 4 of the 1992 Act, the Exim Policy of

1992-1997 continued to be in force and was deemed to have

been made under the 1992 Act.

16. Section 5 of the 1992 Act, as it stood at the relevant point of time,

dealt with export and import policy. As per Section 5, the Central

Government may from time to time formulate and anounce by

notification in the Official Gazette, the export and import policy and

may also, in the like manner, amend that policy. 

[2024] 2 S.C.R. 101

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

17. Rule 2(e) of the Foreign Trade (Regulation) Rules, 1993, framed

under the 1992 Act, defines the word ‘policy’ to mean export and

import policy formulated and announced by the Central Government

under Section 5.

18. Let us now revert back to the Exim Policy, 1992 – 1997. Section 7

of the said policy ascribes meaning to the words and expressions for

the purpose of the policy. As per Section 7(13), ‘drawback’ in relation

to any goods manufactured in India and exported means the rebate

of duty chargeable on any imported materials or excisable materials

used in the manufacture of such goods in India.

19. Chapter VII of the policy provides for ‘Duty Exemption Scheme’.

Section 47, which is the first section in Chapter VII, mentions

that under the Duty Exemption Scheme, imports of duty free raw

materials, components, intermediates, consumables, parts, spares

including mandatory spares and packing materials required for the

purpose of export production may be permitted by the competent

authority under the five categories of licences mentioned in the

said chapter, including special imprest licence. As per Section

56 (ii)(3), supplies made to projects financed by multilateral or

bilateral agencies like the International Bank for Reconstruction and

Development would be entitled to duty free import of raw materials,

components, intermediates, consumables, parts, spares including

mandatory spares and packing materials to main/sub-contractors for

the manufacture and supply of products to such projects.

20. Chapter X introduced the concept of ‘deemed exports’. Section 120

defines ‘deemed exports’ to mean those transactions in which the

goods supplied did not leave the country and the payment for the

goods was received by the supplier in Indian rupees but the supplies

earned or saved foreign exchange for the country.

21. Under Section 121 (f), supply of goods to projects financed by

multilateral or bilateral agencies, such as, the International Bank

for Reconstruction and Development under international competitive

bidding or under limited tender system would be regarded as ‘deemed

exports’ under the Exim Policy of 1992-1997.

22. Section 122 provides that ‘deemed exports’ shall be eligible for the

benefits in respect of manufacture and supply of goods qualifying

as ‘deemed exports’, including under the Duty Drawback Scheme.

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23. In exercise of the powers conferred by Section 75 of the Customs

Act, Section 37 of the Central Excise Act and Section 93A read with

Section 94 of the Finance Act, 1994, the Central Government has

made a set of rules called the Customs, Central Excise Duties and

Service Tax Drawback Rules, 1995. Rule 2(a) defines ‘drawback’ in

relation to any goods manufactured in India and exported, to mean

the rebate of duty or tax as the case may be, chargeable on any

imported materials or excisable materials used or taxable services

used as input services in the manufacture of such goods. ‘Excisable

material’ has been defined under Rule 2(b) to mean any material

produced or manufactured in India subject to a duty of excise under

the Central Excise Act. Likewise, the expression ‘imported material’

has been defined under Rule 2(d) to mean any material imported

into India and on which duty is chargeable under the Customs Act.

23.1. Rule 3 provides for allowance of drawback. Sub-rule (1) says

that subject to the provisions of the Customs Act, Central

Excise Act, the Finance Act, 1994 and the rules made under

the aforesaid three enactments, a drawback may be allowed

on the export of goods at such amount or at such rates as may

be determined by the Central Government.

23.2. Rule 14 deals with payment of drawback and interest. Subrule (1) says that the drawback under the Customs, Central

Excise Duties and Service Tax Drawback Rules, 1995 (briefly

‘the 1995 Rules’ hereinafter) and interest, if any, shall be paid

by the proper officer of customs to the exporter or to the agent

specially authorized by the exporter to receive the said amount

of drawback and interest. Sub-rule (2) clarifies that the officer

of customs may combine one or more claims for the purpose of

payment of drawback and interest, if any, as well as adjustment

of any amount of drawback and interest already paid and may

issue a consolidated order for payment. As per sub-rule (3),

the date of payment of drawback and interest, if any, shall be

deemed to be, in the case of payment by cheque, the date of

issue of such cheque; or by credit in the exporter’s account

maintained with the Custom House, the date of such credit.

24. At this stage, we may mention that in exercise of the powers conferred

by Section 27A of the Customs Act, the Central Board of Excise and

Customs had issued notification bearing No.32/1995 (NT)-Customs 

[2024] 2 S.C.R. 103

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

dated 26.05.1995 fixing the rate of interest at fifteen percent for the

purposes of Section 27A of the Customs Act. This was notified by

the Central Government in the Ministry of Finance, Department of

Revenue in the Official Gazette of India dated 26.05.1995.

25. Likewise, in exercise of the powers conferred by Section 11BB of the

Central Excise Act, the Central Board of Excise and Customs issued

notification No.22/95-Central Excises (NT) dated 29.05.1995 fixing

the rate of interest at fifteen percent per annum for the purposes of

the said section. This was also notified by the Central Government

in the Official Gazette of India on 29.05.1995.

26. Though it may not be necessary, still we may refer to the circulars

dated 20.08.1998 and 05.12.2000 issued by the DGFT. Circular

dated 20.08.1998 says that representations had been received from

individual exporters as well as clarifications sought for by different

regional licencing authorities with regard to availability of deemed

export benefit for supply of goods and services to civil construction

projects. Circular dated 20.08.1998 says that the issue as to whether

supply of goods and services to civil construction projects would be

entitled for deemed export benefit or not had been examined in detail,

whereafter it was clarified that supply of goods under paragraph 10(2)

(d) of the Exim Policy would be entitled to deemed export benefit.

Therefore, if within the scope of a work of turn-key civil construction

project, supply of goods is included then supply of such goods would

be entitled to deemed export benefit.

26.1. It appears that representations were continued to be received

by the DGFT regarding admissibility of duty drawback on

supplies made to turn-key projects, considered as deemed

export in terms of the Exim Policy. Circular dated 05.12.2000

mentions that the matter was deliberated upon by the Policy

Review Committee. It was noted that it was not possible for a

single contractor to manufacture himself all the items required

for execution of such projects. Hence certain items, either

imported or indigenous, had necessarily to be procured from

other sources. It was, therefore, clarified that all such directly

supplied items, whether imported or indigenous, and used in the

projects, the condition ‘manufactured in India’, a pre-requisite

for grant of deemed export benefit, was satisfied in view of

the fact that such activities being undertaken at the project 

104 [2024] 2 S.C.R.

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site constituted ‘manufacture’ as per the definition provided in

the Exim Policy. Accordingly, it was clarified that the duties,

customs and central excise, suffered on such goods should

be refunded through the duty drawback route. Referring to the

previous circular dated 20.08.1998, it was further clarified that

excise duty paid on supply of inputs, such as, cement, steel

etc., would be refunded through the duty drawback route in the

same manner as in any other case of excisable goods being

supplied to any other project qualifying for deemed export

benefit, subject to the project authority certifying the receipt

and use of such inputs in the project.

27. As already noted above, a Policy Interpretation Committee was

constituted. The said committee held a meeting on 07.10.2002,

chaired by the DGFT. One of the agenda items deliberated upon

in the said meeting was the claim of the respondent regarding

inclusion of excise duty component in the price quoted before the

project authority as a case of deemed export and refund of the

same through the duty drawback route. The Policy Interpretation

Committee discussed the case of the respondent and opined that in

case any such firms were still competitive and able to supply goods

at international prices despite including the component of excise duty

in the price quoted before the project authority, the deemed export

benefit could not be denied to such firms. Hence, the committee

decided to permit deemed export benefit even in cases where the

excise duty component was factored in the pricing quoted provided

other conditions of deemed export benefit were adhered to.

27.1. From a perusal of the minutes of the meeting of the Policy

Interpretation Committee held on 07.10.2002, it is evident

that the committee had opined to extend the deemed export

benefit to those firms which included excise duty component

in the tender pricing quoted before the project authority such

as the respondent. There is nothing in the minutes to indicate

that such benefit was being extended to the respondent as a

one off case or by way of concession.

28. Based on the minutes of the Policy Interpretation Committee meeting

held on 07.10.2002, DGFT issued letter dated 01.11.2002, a copy

of which was marked to the respondent, superseding the previous

rejection order dated 21.06.2002 and allowing duty drawback to be 

[2024] 2 S.C.R. 105

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

paid to the respondent for materials/goods, such as, steel, cement

etc., used in the civil works of Koyna Hydro Electric Project. The

amount of drawback refundable to the respondent was quantified

at Rs.2,05,79,740.00. In the said letter, it was, however, mentioned

that grant of drawback should not be treated as a precedent. It was

thereafter that cheques were issued paying the aforesaid amount of

duty drawback to the respondent. At that stage, respondent submitted

representations contending that there was delay in the refund of

drawback and therefore, it was entitled to interest from the relevant

date at the rate of fifteen percent in terms of the notification No.22/95

dated 29.05.1995 (we may mention that the respondent had placed

reliance on the aforesaid notification which fixed interest at the rate

of fifteen percent for delayed refund of duty under Section 11BB of

the Central Excise Act). However, such representations were rejected

by the DGFT on 10.07.2003 and 06.08.2003 respectfully. In the

rejection letter dated 10.07.2003, respondent was informed by the

office of DGFT that there was no provision for payment of interest

on the deemed export duty drawback. Therefore, the request for

payment of interest could not be agreed upon.

29. Learned Single Judge referred to the circular dated 05.12.2000 and

observed that pursuant thereto appellants had paid the duty drawback

to the respondent. However, there was delay in payment of duty

drawback at least from the date of the clarificatory circular dated

05.12.2000. Therefore, respondent would be entitled to interest from

the date of the clarification till the date of payment. After observing

that the Customs Act provides for interest on delayed refund within

the range from five percent to thirty percent, learned Single Judge

directed the appellants to pay interest on the delayed refund from

the date of the clarificatory circular dated 05.12.2000 till the date of

payment within a period of three months.

30. Appellants filed Writ Appeal No.356 of 2006 assailing the aforesaid

decision of the learned Single Judge. On the other hand, respondent

also filed a writ appeal being Writ Appeal No.3699 of 2005 assailing

the directions of the learned Single Judge to pay interest only from

the date of the circular dated 05.12.2000.

30.1. Before the Division Bench, it was contended on behalf of the

appellants that it was only under the Foreign Trade Policy,

2004-2009 that for the first time payment of simple interest 

106 [2024] 2 S.C.R.

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at the rate of six percent per annum in the event of delay in

refund of duty drawback was provided. There was no provision

for payment of interest on delayed refund of duty drawback on

deemed export prior thereto. Therefore, respondent was not

entitled to interest even from 05.12.2000 as directed by the

learned Single Judge. It was canvassed before the Division

Bench on behalf of the appellants that only due to magnanimity

on the part of the Central Government refund of duty drawback

under deemed export was paid to the respondent. As such,

refund would not carry any interest.

30.2. The Division Bench repelled such contentions advanced on

behalf of the appellants and held that in view of the circular

dated 05.12.2000, it was clarified that even civil construction

works were entitled to the benefit of deemed export under the

Exim Policy. After saying so, the Division Bench noted that as

a matter of fact, an amount of Rs.2,05,79,740.00 was paid

to the respondent as duty drawback. Thereafter, the Division

Bench analysed the circular dated 05.12.2000 and upon such

analysis it was observed that the position vis-à-vis refund of

duty drawback in civil construction work treating it as deemed

export was clarified in an earlier circular dated 20.08.1998.

Thus, according to the Division Bench, by the year 1998 itself,

DGFT had clarified that civil construction work was entitled to

the benefit of duty drawback as deemed export. Having held

so, the Division Bench posed a question as to whether the

respondent would be entitled to interest after expiry of three

months from the date of the applications for refund of duty

drawback? Corollary to the above question was an ancillary

question as to whether a clarificatory or declaratory notification

or circular would have retrospective operation? After referring to

decisions of this Court reported in 1993 Supplementary (3) SCC

234 S. S. Grewal versus State of Punjab, (1995) 2 SCC 630

Rajagopal Reddy (dead) by Lrs. Vs. Padmini Chandrasekharan

(dead) by Lrs., and (2004) 8 SCC 1 Zile Singh versus State of

Haryana, the Division Bench opined that the minute the Exim

Policy came into force the benefit of duty drawback automatically

became available to the respondent and that the clarification 

[2024] 2 S.C.R. 107

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

was only with regard to the doubts expressed in some quarters

as to whether civil construction works were also entitled to

such benefit. By virtue of the two circulars dated 20.08.1998

and 05.12.2000, no new right or benefit came to be created;

those two circulars were clarificatory in nature only clarifying

that the benefit under the Exim Policy 1992-1997 was available

to civil construction as well. Therefore, such benefit would

take effect from the date of the Exim Policy. It was thereafter

that the Division Bench posed the further question as to what

would be the rate of interest on the delayed refund. In this

connection, the Division Bench referred to Sections 27A and

75A of the Customs Act and came to the conclusion that the

date of payment of interest would have to be on expiry of the

period of three months from the date of making an application

for refund of duty drawback. The Division Bench held that the

respondent would be entitled to interest from the date of expiry

of three months after submission of applications for refund back

in the year 1996 till the time the payment was made at the rate

of fifteen percent as awarded by the learned Single Judge.

Consequently, the appeal of the appellants was dismissed

while the appeal of the respondent was allowed.

31. Reverting back to the Exim Policy of 1992-1997, we have already

noted about the Duty Exemption Scheme. We have noted that under

the Duty Exemption Scheme, import of duty free raw materials,

components, intermediates, consumables, parts, spares including

mandatory spares and packing materials required for the purpose of

export production could be permitted by the competent authority under

five categories of licences mentioned in Chapter VII including special

imprest licence. Section 56 provided that a special imprest licence

was granted for the duty free import of raw materials, components,

consumables, parts, spares including mandatory spares and packing

materials to main/sub-contractors for the manufacture or supply

of products when such supply were made to projects financed by

multilateral or bilateral agencies, such as, the International Bank for

Reconstruction and Development under international competitive

bidding or under limited tender system.

108 [2024] 2 S.C.R.

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31.1. In Chapter X ‘deemed export’ has been defined. It is a transaction

in which the goods supplied do not leave the country and the

payment for the goods is received by the supplier in Indian

rupees, but the supplies earn or save foreign exchange for

the country. Section 121 declares that the categories of supply

of goods mentioned in the said section would be regarded as

‘deemed export’ under the Exim Policy provided the goods

were manufactured in India and the payment was received

in Indian rupees. This included supply of goods to projects

financed by multilateral or bilateral agencies or any other

agency that may be notified by the Central Government, such

as, the International Bank for Reconstruction and Development

under international competitive bidding or under limited tender

system in accordance with the procedures of those agencies.

31.2. Section 122 clarifies that deemed export would be eligible

for benefits under the Duty Drawback Scheme in respect of

manufacture and supply of goods by treating those as deemed

export.

32. That apart, as already mentioned in the earlier part of the judgement,

the Explanation below sub-section (1) of Section 27 of the Customs

Act clarifies that the expression ‘the date of payment of duty or interest’

in relation to a person other than an importer shall be construed as

‘the date of purchase of goods’ by such person.

33. Therefore, on a conjoint and careful reading of the relevant provisions

of the Exim Policy, 1992-1997 in conjunction with the Central Excise

Act and the Customs Act, it is evident that supply of goods to the

project in question by the respondent was a case of ‘deemed export’

and thus entitled to the benefit under the Duty Drawback Scheme.

The language employed in the policy made this very clear and there

was no ambiguity in respect of such entitlement.

34. Even if there was any doubt, the same was fully explained by the

1995 Rules. In fact, under the definition clause of the 1995 Rules,

duty drawback, in relation to any goods manufactured in India

and exported has been defined to mean the rebate of duty or tax

chargeable on any imported materials or excisable materials used 

[2024] 2 S.C.R. 109

Union of India and Ors. v.

M/S. B.T. Patil and Sons Belgaum (Construction) Pvt. Ltd.

or taxable services used in the manufacture of such goods. In the

preceding paragraphs, we have noted the meaning of the expressions

‘excisable materials’ and ‘manufacture’.

34.1. Rule 3 of the 1995 Rules makes it abundantly clear that a

drawback may be allowed on the export of goods at such

amount or at such rates as may be determined by the Central

Government. Further, Rule 14 provides for payment of drawback

and interest.

35. It was, therefore, not correct on the part of the appellants to contend

that there was no provision for payment of interest on delayed refund

of duty drawback. That apart, it is wholly untenable for the appellants

to contend that refund of duty drawback was granted to the respondent

as a concession, not to be treated as a precedent. As we have seen,

respondent is entitled to refund of duty drawback as a deemed export

under the Duty Drawback Scheme. The applications for refund were

made in 1996. Decision to grant refund of duty drawback was taken

belatedly on 07.10.2002 whereafter the payments were made by

way of cheques on 31.03.2003 and 20.05.2003. Admittedly, there

was considerable delay in refund of duty drawback.

36. As we have already examined, under sub-section (1) of Section 75A

of the Customs Act, where duty drawback is not paid within a period

of three months from the date of filing of claim, the claimant would be

entitled to interest in addition to the amount of drawback. This section

provides that the interest would be at the rate fixed under Section

27A from the date after expiry of the said period of three months

till the payment of such drawback. If we look at Section 27A, the

interest rate prescribed thereunder at the relevant point of time was

not below ten percent and not exceeding thirty percent per annum.

37. The Central Board of Excise and Customs vide its notification bearing

No.32/1995 (NT) – Customs dated 26.5.1995 had fixed the rate

of interest at fifteen percent for the purpose of Section 27A of the

Customs Act. The High Court while awarding interest at the rate of

fifteen percent per annum, however, did not refer to such notification;

rather, there was no discussion at all as to why the rate of interest

on the delayed refund should be fifteen percent. Therefore, at the

first glance, the rate of interest awarded by the High Court appeared

to be on the higher side and without any reason. 

110 [2024] 2 S.C.R.

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38. Be that as it may, having regard to our discussions made above,

we have no hesitation in holding that the respondent was entitled

to refund of duty drawback. Appellants had belatedly accepted the

said claim and made the refund. Since there was belated refund of

the duty drawback to the respondent, it was entitled to interest at

the rate which was fixed by the Central Government at the relevant

point of time being fifteen percent.

39. That being the position, we find no good reason to interfere with the

judgment and order of the Division Bench of the High Court dated

22.8.2008. There is no merit in the appeal, which is accordingly

dismissed. No costs.

Headnotes prepared by: Divya Pandey Result of the case: Appeal dismissed.

Jharkhand Superior Judicial Service (Recruitment, Appointment and Conditions of Service) Rules, 2001 – rr.14, 18, 21 – Jharkhand Superior Judicial Service (Recruitment, Appointment and Conditions of Service) Regulation, 2017 – Selection to the posts of District Judge Cadre in the State of Jharkhand – Alteration in selection criteria after the performance of individual candidates was assessed – Higher aggregate marks prescribed in deviation from the statutory rules – By way of Full Court Resolution, High Court introduced securing 50 per cent marks in aggregate (combination of marks obtained in main examination and viva-voce) as the qualifying criteria for being recommended to the posts of District Judge – Impermissibility:

[2024] 2 S.C.R. 217 : 2024 INSC 97

Sushil Kumar Pandey & Ors.

v.

The High Court of Jharkhand & Anr.

 (Writ Petition (Civil) No. 753 of 2023)

01 February 2024

[Aniruddha Bose and Sanjay Kumar, JJ.]

Issue for Consideration

High Court whether justified in altering the selection criteria after the

performance of individual candidates was assessed for selection

to the posts of District Judge Cadre in the State of Jharkhand.

Headnotes

Jharkhand Superior Judicial Service (Recruitment,

Appointment and Conditions of Service) Rules, 2001 – rr.14,

18, 21 – Jharkhand Superior Judicial Service (Recruitment,

Appointment and Conditions of Service) Regulation, 2017 –

Selection to the posts of District Judge Cadre in the State

of Jharkhand – Alteration in selection criteria after the

performance of individual candidates was assessed – Higher

aggregate marks prescribed in deviation from the statutory

rules – By way of Full Court Resolution, High Court introduced

securing 50 per cent marks in aggregate (combination of

marks obtained in main examination and viva-voce) as the

qualifying criteria for being recommended to the posts of

District Judge – Impermissibility:

Held: Under r.18, the task of setting cut-off marks was vested

in the High Court but this was to be done before the start of the

examination – Stipulations contained in r.21 for making the select

list were breached by the High Court administration in adopting

the impugned resolution – Plea that applying a higher aggregate

mark was not barred under the Rules or Regulations, not accepted

– The very expression “aggregate” means combination of two or

more processes and in the event the procedure for arriving at the

aggregate has been laid down in the applicable Rules, a separate

criteria cannot be carved out to enable change in the manner

of making the aggregate marks – If the High Court is permitted

to alter the selection criteria after the performance of individual 

218 [2024] 2 S.C.R.

Digital Supreme Court Reports

candidates is assessed, that would constitute alteration of the laid

down Rules – Plea of the High Court administration that r.14 permits

them to alter the selection criteria after the selection process is

concluded and marks are declared is not proper exposition of the

said provision – r.14 empowers the High Court administration in

specific cases to reassess the suitability and eligibility of a candidate

in a special situation by calling for additional documents –High

Court administration cannot take aid of this Rule to take a blanket

decision for making departure from the selection criteria specified

in the 2001 Rules – High Court to make recommendation for

those candidates who were successful as per the merit or select

list, for filing up the subsisting notified vacancies without applying

the Full Court Resolution that requires each candidate to get 50

per cent aggregate marks – The part of the Full Court Resolution

of the Jharkhand High Court by which it was decided that only

those candidates who secured at least 50% marks in aggregate

shall be qualified for appointment to the post of District Judge is

quashed [Paras 20, 22-24]

Service jurisprudence – Change in the rule midway – Discussed.

Case Law Cited

Sivanandan C.T. & Ors. v. High Court of Kerala, [2023]

11 SCR 674 : (2023) INSC 709 – followed.

State of Haryana v. Subash Chander Marwaha & Ors.,

[1974] 1 SCR 165 : (1974) 3 SCC 220; Ram Sharan

Maurya and Ors. v. State of U.P. and Ors., [2020] 12

SCR 466 : (2021) 15 SCC 401 – distinguished.

K.Manjusree v. State of Andhra Pradesh and Anr., [2008]

2 SCR 1025 : (2008) 3 SCC 512; Hemani Malhotra

v. High Court of Delhi, [2008] 5 SCR 1066 : (2008) 7

SCC 11 – relied on.

Tej Prakash Pathak & Ors. v. Rajasthan High Court and

Others: (2013) 4 SCC 540 – referred to.

List of Acts

Jharkhand Superior Judicial Service (Recruitment, Appointment and

Conditions of Service) Rules, 2001; Jharkhand Superior Judicial

Service (Recruitment, Appointment and Conditions of Service)

Regulation, 2017; Constitution of India.

[2024] 2 S.C.R. 219

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

List of Keywords

District Judge Cadre; Altering the selection criteria; Higher

aggregate mark; Qualifying criteria; Cut-off marks; Departure from

selection criteria.

Case Arising From

CIVIL ORIGINAL JURISDICTION : Writ Petition (Civil) No.753 of 2023

(Under Article 32 of The Constitution of India)

With

Writ Petition (Civil) No.921 of 2023

Appearances for Parties

Arunabh Chowdhury, Sr. Adv./A.A.G., Vinay Navare, K

Karpagavinagagam, Dushyant Dave, Ms. Meenakshi Arora, Jayant

K. Sud, Jaideep Gupta, Sr. Advs., Mahesh Thakur, Ms. Neha Singh,

Mrs. Geetanjali Bedi, Ranvijay Singh Chandel, Shivamm Sharrma,

Ms. Shivani, Prithvi Pal, Sanjay Kumar Yadav, Manoj Jain, Ms.

Kiran Bhardwaj, C Aravind, K V Mathu Kumar, Ms. Geeta Verma,

Syed Imtiyaz, Usman Khan, Ms. Madhurima Sarangi, Naeem

Ilyas, Towseef Ahmad Dar, Danish Zubair Khan, Dr. Lokendra

Malik, Surya Nath Pandey, Durga Dutt, Rohit Priyadarshi, Upendra

Narayan Mishra, Satyendra Kumar Mishra, Ms. Rashi Verma,

Somesh Kumar Dubey, Kartik Jasra, Prannit Stefano, Shivam

Nagpal, Ms. Susmita Lal, Ms. Racheeta Chawla, Kamakhya

Srivastava, Rajiv Shanker Dvivedi, Ms. Tulika Mukherjee, Karma

Dorjee, Dechen W. Lachungpa, Beenu Sharma, Venkat Narayan,

Advs. for the appearing parties.

Judgment / Order of the Supreme Court

Judgment

In these two writ petitions, we are to address the legality of the

selection process of District Judge Cadre in the State of Jharkhand

initiated in the year 2022. An advertisement bearing No. 01/2022

was published on 24th March, 2022, inviting applications from the

eligible candidates for the said posts. The vacancies specified in

the advertisement itself were twenty-two. Appointment procedure to 

220 [2024] 2 S.C.R.

Digital Supreme Court Reports

the said posts is guided by the Jharkhand Superior Judicial Service

(Recruitment, Appointment and Conditions of Service) Rules, 2001

(‘the 2001 Rules’). In the year 2017, the Jharkhand Superior Judicial

Service (Recruitment, Appointment and Conditions of Service)

Regulation, 2017 (“the 2017 Regulation”) was framed in terms of

Rule 11 and Rule 30 of the 2001 Rules for this purpose.

2. On the basis of cut-off marks specified in the advertisement as also

in the 2001 Rules, select list of sixty-six persons was published,

applying the 1:3 ratio as there were twenty-two published vacancies.

3. The High Court on its administrative side, however, recommended

only thirteen candidates for appointment though the vacancies

declared were twenty-two. A resolution to that effect was taken in

a Full Court meeting held on 23.03.2023. We shall quote relevant

provisions from the 2001 Rules in subsequent paragraphs of this

judgment along with the relevant extracts from the advertisement.

In the advertisement, the relevant portions for adjudication of the

subject dispute were contained under the heading ‘Eligibility and

Conditions’. The following criteria for selection was specified therein:-

“Preliminary Entrance Test

(1) The Preliminary Entrance Test shall consist. Of:-

i. General English

ii. General Knowledge(including Current Affairs).

iii. C.P.C.

iv. Cr.P.C.

v. Evidence Act

vi. Law of Contract.

vii. IPC

(2) The Preliminary Entrance Test shall be of 100 in aggregate

(3) Duration of Preliminary Entrance Test shall be of two hours.

(4) There shall be negative marking of -1 mark (minus one)for

each wrong answer.

Main Examination

(1) The Main Examination shall consist of:-

[2024] 2 S.C.R. 221

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

Paper -I

Part- I Language (English) 50 Marks

(Essay, Precis, Preposition and Comprehension etc,)

Part- II

(i) Procedural Law (Cr.P.C. & C.P.C)

(ii) Law of Evidence

(iii) Law of Limitation 50 Marks

Paper- II

Substantive Law 100 Marks

(i) Constitution of India

(ii) Indian Penal Code

(iii) Law of Contract

(iv) Sale of Goods Act

(v) Transfer of Property Act

(vi) Negotiable Instrument Act

(vii) Law relating to Motor Vehicle Accident Claim

(viii) Jurisprudence.

(ix) Santhal Pargana Tenancy Act

(x) Chhotanagpur Tenancy Act

(xi) Protection of Children from Sexual Offences Act (pocso)

(xii) Prevention Of Corruption Act (xiii) SC & ST Act

(xiv) Electricity Act

(xv) Narcotic Drugs and Psychotropic Substances Act (NDPS

Act)

(2) Examination shall be held in two sittings of three hours duration

for each paper.

Viva-Voce Test

(1) There shall be Viva-Voce Test of 40 marks.

(2) The marks obtained in Viva-Voce Test shall be added to

the marks obtained in Main Examination and the merit list

shall be prepared accordingly.

222 [2024] 2 S.C.R.

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(3) No candidate irrespective of the marks obtained by him

in the Main Examination, shall be eligible for selection

for appointment, if he obtains less than 20 marks out of

aggregate of 40 in the Viva-Voce. Test.

Note:- Every differently abled candidate will be allowed

“compensatory time” of 20 minutes for each hour of written

examination.”

4. So far as the selection process involved in these proceedings is

concerned, no preliminary entrance test was held, but that question

is not in controversy before us. The main examination comprising

of Paper-I and Paper-II carried a total of 200 marks. As per the

advertisement, the marks allocated for viva-voce test was 40 as would

appear from the preceding paragraph. A candidate irrespective of

the marks obtained by him in the main examination was required to

get at least 20 marks out of the aggregate 40 in the viva-voce test.

5. As per the 2001 Rules, the provisions relevant are Rules 14, 18, 21

and 22. These Rules read:-

“14. Notwithstanding anything contained in the foregoing

Rule, it shall be open to the High Court to require the

candidate at any stage of the selection process or

thereafter, to furnish any such additional proof or to produce

any document with respect to any matter relating to his

suitability and/or eligibility as the High Court may deem

necessary.

18. Before the start of the examination, the High Court

may fix the minimum qualifying marks in the Preliminary

Written Entrance Test and thereafter minimum qualifying

marks in the main examination. Based on such minimum

qualifying marks, the High Court may decide to call for

viva-voce such number of candidates, in order of merit

in written examination, depending upon the number of

vacancies available as it may appropriately decide:

Provided that in the case of candidates belonging to

scheduled castes and scheduled tribes and candidates

belonging to other reserved categories, such minimum

qualifying marks may not be higher than 45% of the total

aggregate marks :

[2024] 2 S.C.R. 223

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

Provided also that in determining the suitability of a

particular candidate based on both the minimum qualifying

marks as well as in order of merit, the total marks obtained

in the examination as a whole and the marks obtained

in any individual paper, both shall also be taken into

consideration, depending upon any guidelines that the

High Court may issue in this behalf in the Regulations to

be framed for this purpose.

21. A candidate, irrespective of the marks obtained by him

in the Preliminary Written Entrance Examination and/or

the Main Written Examination shall not be qualified to be

appointed unless he obtains a minimum of 30% marks in

the viva-voce test. The marks obtained at the viva voce

test shall then be added to the marks obtained by the

candidate at the main written examination. The names of

the candidates will then be tabulated and arranged in order

of merit. If two or more candidates obtain equal marks in

the aggregate, the order shall be determined in accordance

with the marks secured at the main written examination.

If the marks secured at the main written examination of

the candidates also are found equal then the order shall

be decided in accordance with the marks obtained in the

Preliminary Written Entrance Test. From the list of candidates

so arranged in order of merit the High Court shall prepare a

select list and have it duly notified in a manner as prescribed

in the regulations. Such select list shall be valid for a period

of one year from the date of being notified.

22. From out of the aforesaid select list, depending upon the

number of vacancies available or those required to be filled

up, the High Court shall recommend to the Government

the names for appointment as Additional District Judge.”

6. There appears to be one inconsistency in relation to minimum marks

prescribed between the content of Rule 21 of the said Rules and

paragraph 12 of the 2017 Regulation. The said paragraph of the

Regulation stipulates:-

“(12) No candidate irrespective of the marks obtained by

him in the Main Examination, shall be eligible for selection

for appointment, if he obtains less than 20 marks out of

aggregate of 40 in the Viva-Voce Test.”

224 [2024] 2 S.C.R.

Digital Supreme Court Reports

7. We have already quoted Rule 21 of the 2001 Rules where minimum of

30% marks in the viva-voce has been prescribed as the qualification

criteria. But that question also does not arise in the present two writ

petitions as none of the parties before us has raised this point. We

also find it to be a safer course to go by the provisions of paragraph

12 of the 2017 Regulation, as the advertisement also prescribed

minimum 20 marks out of aggregate of 40 in the Viva Voce test.

8. Admitted position is that the 9 candidates who have been left out

from being recommended for appointment, had found place in the

select list in terms of Rule 21 of the 2001 Rules.

9. In Writ Petition (Civil) No. 753 of 2023, altogether seven petitioners

have joined in questioning the exclusion of the 9 candidates by

the Full Court Resolution. The said resolution introduces securing

50 per cent marks in aggregate (combination of marks obtained in

main examination and viva-voce) as the qualifying criteria for being

recommended to the said posts. This resolution against Agenda

No. 1 of the Full Court Meeting held on 23rd March, 2023 records:-

SL.No. AGENDA RESOLUTIONS

1. To consider the matter

o v e r r e c r u i t m e n t

process of District

J u d g e [ U / r 4 ( a )

directly from Bar] with

regard to Final Result

against advertisement

no.01/2022/Apptt.

Considered.

The Full Court resolves to approve

the final result list of 63 Candidates

who have appeared for viva voce

(list enclosed with this resolution and

marked at Flag “X”)

Further, Full Court observes that

candidates at Sl.No.7 & 8 have

got the same total marks, but on

careful consideration it transpires that

candidate at Sl.No.8 has got higher

marks in written examination. Hence

in view of Rule 21 of Jharkhand

Superior Judicial (Recruitment,

Appointment and Conditions of

Service) Rules, 2001, candidate at

Sl.No.8 is placed at higher place/

rank.

[2024] 2 S.C.R. 225

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

Further after due deliberation,

keeping in view the responsibility that

will be vested upon the candidates

who qualify for appointment of

District Judges and to maintain the

high standard of Superior Judicial

Services, the Full Court resolves

that only those candidates who

have secured at least 50% marks

in aggregate, shall be qualified for

appointment to post of District Judge.

It is hereby resolved to recommend

the names of following 13 top

(merit wise) candidates to the

State Government for issuance of

necessary notification/s for their

appointment to the post of District

Judge after completing/undertaking

the investigation/enquiry relating to

the candidates credentials as per

Rule 23 & 24 of Jharkhand Superior

Judicial (Recruitment, Appointment

and Conditions of Service) Rules,

2001:

S.No. Roll No. Name

1 10369 NAMITA CHANDRA

2 10956 SHWETA DHINGRA

3 10343 PARAS KUMAR SINHA

4 10388 KUMAR SAKET

5 10519 SHIVNATH TRIPATHI

6 10218 BHUPESH KUMAR

7 11577 AISHA KHAN

8 10294 BHANU PRATAP SINGH

9 10592 NEETI KUMAR

10 10371 PRACHI MISHRA

11 10109 PAWAN KUMAR

226 [2024] 2 S.C.R.

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12 11061 RAJESH KUMAR BAGGA

13 10587 NARANJAN SINGH

Registrar General is directed to upload the names of above mentioned

13 successful candidates to the official website of this Court.

10. This Resolution has been disclosed in the reply to the Rejoinder

affidavit filed on behalf of the High Court of Jharkhand, affirmed by

Registrar General of that Court.

11. There are two impleadment applications registered as I.A. No.

173928 of 2023 taken out by ‘Purnendu Sharan’ and I.A. No. 10383

of 2024 taken out by ‘Ashutosh Kumar Pandey’, both of them being

aggrieved by the procedure adopted by the Full Court.

12. Another set of candidates have filed the second writ petition registered

as Writ Petition (Civil) No. 921 of 2023. In this writ petition, altogether

five candidates have sought substantially the same relief asked for

in the Writ Petition (Civil) No. 753 of 2023.

13. The petitioners have been represented before us by Mr. Dushyant

Dave, Mr. Vinay Navare and Mr. Jayant K. Sud, learned senior

counsel whereas the High Court of Jharkhand has been represented

by Mr. Jaideep Gupta, learned senior counsel. Mr. Rajiv Shanker

Dvivedi, learned Standing Counsel for the State of Jharkhand has

appeared for the State. State has taken a non-committal stand before

us. Counter affidavit has been filed by the State in which also no

definitive stand has been taken on the legality of the Resolution

in the Full Court meeting of the High Court. It has however been

submitted by the State that certain amendments need to be carried

out in Rule 21 of the 2001 Rules. That plea does not come within

the scope of the present proceedings.

14. The petitioners’ main case rests on two planks. First one is that the

decision of the Full Court on the administrative side goes contrary

to the Recruitment Rules, Regulations and the Terms contained in

the advertisement. The second plank of the submissions advanced

by the petitioners is that in any event, after the performance of each

of the candidate is known and the marks obtained by them in the

two forms of the examination are disclosed, it was impermissible

for the High Court Administration to introduce fresh cut-off marks.

On this point, the authority relied upon by Mr. Dave is a judgment

of a Constitution Bench comprising of five Hon’ble Judges of this 

[2024] 2 S.C.R. 227

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

Court in the case of Sivanandan C.T. & Ors. Vs. High Court of

Kerala [(2023) INSC 709)] decided on 12th July, 2023. This judgment

narrates the factual background of that case in paragraph ‘7’ thereof

and the ratio of this decision would emerge from paragraphs ‘52’ to

‘57’ of the said judgment. These passages from the judgment are

quoted below:-

“7. On 27 February 2017, after the viva-voce was

conducted, the Administrative Committee of the High

Court passed a resolution by which it decided to apply

the same minimum cut-off marks which were prescribed

for th e written examination as a qualifying criterion in the

viva-voce. In coming to this conclusion, the Administrative

Committee was of the view that since appointments

were being made to the Higher Judicial Service, it was

necessary to select candidates with a requisite personality

and knowledge which could be ensured by prescribing

a cut-off for the viva-voce in terms similar to the cut-off

which was prescribed for the written examination. On 6

March 2017, the Full Court of the High Court of Kerala

approved the resolution of the Administrative Committee.

The final merit list of the successful candidates was also

published on the same day.

 x x x

52. The statutory rule coupled with the scheme of

examination and the 2015 examination notification would

have generated an expectation in the petitioners that

the merit list of selected candidates will be drawn on

the basis of the aggregate of total marks received in the

written examination and the viva voce. Moreover, the

petitioners would have expected no minimum cutoff for

the viva voce in view of the express stipulation in the

scheme of examination. Both the above expectations of

the petitioners are legitimate as they are based on the

sanction of statutory rules, scheme of examination, and

the 2015 examination notification issued by the High Court.

Thus, the High Court lawfully committed itself to preparing

a merit list of successful candidates on the basis of the

total marks obtained in the written examination and the

viva voce. 

228 [2024] 2 S.C.R.

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ii. Whether the High Court has acted unlawfully in relation

to its commitment?

53. The Administrative Committee of the High Court

apprehended that a candidate who performed well in the

written examination, even though they fared badly in the

viva voce, would get selected to the post of District and

Sessions Judge. The Administrative Committee observed

that recruitment of such candidates would be a disservice to

the public at large because they possessed only “bookish”

knowledge and lacked practical wisdom. To avoid such a

situation, the Administrative Committee of the High Court

decided to apply a minimum cut-off to the viva voce

examination. The decision of the Administrative Committee

was approved by the Full Bench of the High Court.

54. The Constitution vests the High Courts with the authority

to select judicial officers in their jurisdictions. The High

Court, being a constitutional and public authority, has

to bear in the mind the principles of good administration

while performing its administrative duties. The principles

of good administration require that the public authorities

should act in a fair, consistent, and predictable manner.

55. The High Court submitted that frustration of the

petitioner’s substantive legitimate expectation was in larger

public interest – selecting suitable candidates with practical

wisdom for the post of District Judges. Indeed, it is in the

public interest that we have suitable candidates serving

in the Indian judiciary. However, the criteria for selecting

suitable candidates are laid down in the statutory rules. As

noted above, the High Court did amend the 1961 Rules

in 2017 to introduce a minimum cut-off mark for the viva

voce. The amended Rule 2(c) is extracted below:

“2. Method of appointment – (1) Appointment to the service

shall be made as follows:

[…]

(c) Twenty five percent of the posts in the service shall

be filled up by direct recruitment from the members of the

Bar. The recruitment shall be on the basis of a competitive 

[2024] 2 S.C.R. 229

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

examination consisting of a written examination and a viva

voce. […] Maximum marks for viva voce shall be 50. The

General and Other Backward Classes candidates shall

secure a minimum of 40% marks and Scheduled Caste/

Scheduled Tribe candidate shall secure a minimum of

35% marks for passing the viva voce. The merit list of the

selected candidates shall be prepared on the basis of the

aggregate marks secured by the candidate in the written

examination and viva voce.”

(emphasis supplied)

56. Under the unamended 1961 Rules, the High Court was

expected to draw up the merit list of selected candidates

based on the aggregate marks secured by the candidates

in the written examination and the viva voce, without any

requirement of a minimum cut-off for the viva voce. Thus,

the decision of the Administrative Committee to depart

from the expected course of preparing the merit list of the

selected candidates is contrary to the unamended 1961

Rules. It is also important to highlight that the requirement

of a minimum cutoff for the viva voce was introduced

after the viva voce was conducted. It is manifest that the

petitioners had no notice that such a requirement would

be introduced for the viva voce examination. We are of

the opinion that the decision of High Court is unfair to the

petitioners and amounts to an arbitrary exercise of power.

57. The High Court’s decision also fails to satisfy the test

of consistency and predictability as it contravenes the

established practice. The High Court did not impose the

requirement of a minimum cut-off for the viva voce for the

selections to the post of District and Sessions Judges for

2013 and 2014. Although the High Court’s justification,

when analyzed on its own terms, is compelling, it is not

grounded in legality. The High Court’s decision to apply a

minimum cut-off for the viva voce frustrated the substantive

legitimate expectation of the petitioners. Since the decision

of the High Court is legally untenable and fails on the

touchstone of fairness, consistency, and predictability, we

hold that such a course of action is arbitrary and violative

of Article 14.”

230 [2024] 2 S.C.R.

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15. There is an earlier judgment of this Court comprising of three Hon’ble

Judges in the case of K. Manjusree -vs- State of Andhra Pradesh

and Anr. [(2008) 3 SCC 512] in which the change of recruitment

criteria mid-way through the selection process has been held to

be impermissible. We quote below paragraphs ‘27’ and ‘36’ of that

judgment from the said report:-

“27. But what could not have been done was the second

change, by introduction of the criterion of minimum marks

for the interview. The minimum marks for interview had

never been adopted by the Andhra Pradesh High Court

earlier for selection of District & Sessions Judges, (Grade

II). In regard to the present selection, the Administrative

Committee merely adopted the previous procedure in

vogue. The previous procedure as stated above was to

apply minimum marks only for written examination and not

for the oral examination. We have referred to the proper

interpretation of the earlier Resolutions dated 24.7.2001 and

21.2.2002 and held that what was adopted on 30.11.2004

was only minimum marks for written examination and not for

the interviews. Therefore, introduction of the requirement

of minimum marks for interview, after the entire selection

process (consisting of written examination and interview)

was completed, would amount to changing the rules of

the game after the game was played which is clearly

impermissible. We are fortified in this view by several

decisions of this Court. It is sufficient to refer to three of

them - P. K. Ramachandra Iyer v. Union of India1

, Umesh

Chandra Shukla v. Union of India2

, and Durgacharan Misra

v. State of Orissa3

.

 x x x

36. The Full Court however, introduced a new requirement

as to minimum marks in the interview by an interpretative

process which is not warranted and which is at variance

with the interpretation adopted while implementing the

1 (1984) 2 SCC 141: 1984 SCC (L &S) 214

2 (1985) 3 SCC 721: 1985 SCC (L&S) 919

3 (1987) 4 SCC 646: 1988 SCC (L & S) 36: (1987) 5 ATC 148

[2024] 2 S.C.R. 231

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

current selection process and the earlier selections. As

the Full Court approved the Resolution dated 30.11.2004

of the Administrative Committee and also decided to

retain the entire process of selection consisting of written

examination and interviews it could not have introduced

a new requirement of minimum marks in interviews,

which had the effect of eliminating candidates, who would

otherwise be eligible and suitable for selection. Therefore,

we hold that the action of Full Court in revising the merit list

by adopting a minimum percentage of marks for interviews

was impermissible.”

16. The same view has later been taken by a Coordinate Bench of this

Court in the case of Hemani Malhotra -vs- High Court of Delhi

[(2008) 7 SCC 11]. In a later decision, Tej Prakash Pathak & Ors.

-vs- Rajasthan High Court and Others [(2013) 4 SCC 540], a three

Judge Bench of this Court expressed a view which is different from

that taken in the case of K. Manjusree (supra) and referred the

matter to the Hon’ble the Chief Justice of India for being considered

by a larger Bench. There is no decision yet from a larger Bench and

until the principle laid down in the case of K. Manjusree (supra) is

overruled by a larger Bench, we shall continue to be guided by the

same as “no change in the rule midway” dictum has become an

integral part of the service jurisprudence.

17. The next point urged by Mr. Gupta is that the ratio of the three

judgments on which reliance has been placed by Mr. Dave would

not apply in the facts of the present case. His argument is that in

those three authorities, the marking in viva-voce was the subject

of dispute whereas in the present writ petitions, it is on aggregate

marking that the High Court administration has raised the bar. One

of the authorities on which Mr. Gupta has relied on is State of

Haryana -vs- Subash Chander Marwaha & Ors. [(1974) 3 SCC

220]. In paragraphs 7 and 12 of the said report, it has been held and

observed by a Bench of two Hon’ble Judges of this Court:-

“7. In the present case it appears that about 40 candidates

had passed the examination with the minimum score of

45%. Their names were published in the Government

Gazette as required by Rule 10(1) already referred to. It

is not disputed that the mere entry in this list of the name 

232 [2024] 2 S.C.R.

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of candidate does not give him the right to be appointed

The advertisement that there are 15 vacancies to be

filled does not also give him a right to be appointed. It

may happen that the Government for financial or other

administrative reasons may not fill up any vacancies. In

such a case the candidates, even the first in the list, will

not have a right to be appointed. The list is merely to help

the State Government in making the appointments showing

which candidates have the minimum qualifications under

the Rules. The stage for selection for appointment comes

thereafter, and it is not disputed that under the Constitution

it is the State Government alone which can make the

appointments. The High Court does not come into the

picture for recommending any particular candidate. After

the State Government have taken a decision as to which

of the candidates in accordance with the list should be

appointed, the list of selected candidates for appointment

is forwarded to the High Court then will have to enter

such candidates on a Register maintained by it. When

vacancies are to be filled the High Court will send in the

names of the candidates in accordance with the select

list and in the order they have been placed in that list for

appointment in the vacancies. The High Court, therefore,

plays no part except to suggest to the Government who

in accordance with the select list is to be appointed and

in a particular vacancy. It appears that in the present case

the Public Service Commission had sent up the rolls of

the first 15 candidates because the Commission had been

informed that there are 15 vacancies. The High Court

also in its routine course had sent up the first 15 names

to the Government for appointment. Thereupon the Chief

Secretary to Government, Haryana wrote to the Registrar

of the High Court on May 4, 1971 as follows:

“I am directed to refer to Haryana Government endst

No. 1678-1 GS, II—71/3802, dated April 22, 1971, on

the subject noted above, and to say that after careful

consideration of the recommendations of the Punjab

and Haryana High Court for appointment of first fifteen

candidates to the Haryana Civil Service (Judicial Branch), 

[2024] 2 S.C.R. 233

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

the State Government have taken the view that it would be

appropriate that only the first seven candidates should be

appointed to the Haryana Civil Service (Judicial Branch)

and a notification has been issued accordingly. The

reason is that in the opinion of the State Government,

only those candidates who obtained 55% or more marks

in the Haryana Civil Service (Judicial Branch) Examination,

should be appointed as that will serve to maintain a

minimum standard in the appointments to the Service. It

may be mentioned that the last candidate appointed against

un-reserved vacancies out of the merit list prepared on

the basis of the Haryana Civil Service (Judicial Branch)

Examination held in May 1969, secured 55.67% marks.

The State Government have also received information

that the Punjab and Haryana High Court themselves

recommended to the Punjab Government that in respect

of P.C.S. (Judicial Branch) Examination held in 1970,

candidates securing 55% marks or more should be

appointed against un-reserved vacancies. Thus, the

decision taken by Haryana Government is in line with

the recommendations which the High Court made to the

Punjab Government regarding recruitment to the P.C.S.

(Judicial Branch) on the basis of the Examination held

in 1970, and a similar policy in both the cases would be

desirable for obvious reasons.”

12. It was, however, contended by Dr Singhvi on behalf

of the respondents that since Rule 8 of Part C makes

candidates who obtained 45% or more in the competitive

examination eligible for appointment, the State Government

had no right to introduce a new rule by which they can

restrict the appointments to only those who have scored not

less than 55%. It is contended that the State Government

have acted arbitrarily in fixing 55% as the minimum

for selection and this is contrary to the rule referred to

above. The argument has no force. Rule 8 is a step in the

preparation of a list of eligible candidates with minimum

qualifications who may be considered for appointment.

The list is prepared in order of merit. The one higher in

rank is deemed to be more meritorious than the one who 

234 [2024] 2 S.C.R.

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is lower in rank. It could never be said that one who tops

the list is equal in merit to the one who is at the bottom of

the list. Except that they are all mentioned in one list, each

one of them stands on a separate level of competence

as compared with another. That is why Rule 10(ii), Part

C speaks of “selection for appointment”. Even as there is

no constraint on the State Government in respect of the

number of appointments to be made, there is no constraint

on the Government fixing a higher score of marks for the

purpose of selection. In a case where appointments are

made by selection from a number of eligible candidates

it is open to the Government with a view to maintain

high standards of competence to fix a score which is

much higher than the one required for more eligibility.

As shown in the letter of the Chief Secretary already

referred to, they fixed a minimum of 55% for selection as

they had done on a previous occasion. There is nothing

arbitrary in fixing the score of 55% for the purpose of

selection, because that was the view of the High Court

also previously intimated to the Punjab Government on

which the Haryana Government thought fit to act. That

the Punjab Government later on fixed a lower score is no

reason for the Haryana Government to change their mind.

This is essentially a matter of administrative policy and if

the Haryana State Government think that in the interest

of judicial competence persons securing less than 55%

of marks in the competitive examination should not be

selected for appointment, those who got less than 55%

have no right to claim that the selections be made of also

those candidates who obtained less than the minimum

fixed by the State Government. In our view the High Court

was in error in thinking that the State Government had

somehow contravened Rule 8 of Part C.”

18. Mr. Gupta has also cited the case of Ram Sharan Maurya and Ors.

Vs. State of U.P. and Ors. [(2021) 15 SCC 401]. It has been held

in this judgment:-

“72. In terms of Rule 2(1)(x) of the 1981 Rules, qualifying

marks of ATRE are such minimum marks as may be

determined “from time to time” by the Government. 

[2024] 2 S.C.R. 235

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

Clause (c) of Rule 14 of the 1981 Rules lays down

that a candidate must have “passed Assistant Teacher

Recruitment Examination conducted by the Government”.

Thus, one of the basic requirements for being considered

to be appointed as an Assistant Teacher under the 1981

Rules is passing of ATRE with such minimum marks as

may be determined by the Government. Unlike para 7 of

the Guidelines for ATRE 2018 which had spelt out that a

candidate must secure minimum of 45% or 40% marks

(for “General” and “Reserved” categories respectively) for

passing ATRE 2018, no such stipulation was available in

G.O. dated 1-12-2018 notifying ATRE 2019. Though, the

minimum qualifying marks were set out in the Guidelines

for ATRE 2018, it is not the requirement of the 1981 Rules

that such stipulation must be part of the instrument notifying

ATRE. By very nature of entrustment, the Government

is empowered to lay down minimum marks “from time

to time”. If this power is taken to be conditioned with

the requirement that the stipulation must be part of the

instrument notifying the examination, then there was no

such stipulation for ATRE 2019. Such reading of the rules

will lead to somewhat illogical consequences. On one hand,

the relevant Rule requires passing of ATRE while, on the

other hand, there would be no minimum qualifying marks

prescribed. A reasonable construction on the relevant

rules would therefore imply that the Government must

be said to be having power to lay down such minimum

qualifying marks not exactly alongside instrument notifying

the examination but at such other reasonable time as well.

In that case, the further question would be at what stage

can such minimum qualifying marks be determined and

whether by necessity such minimum qualifying marks must

be declared well before the examination.

73.K. Manjusree [K. Manjusree v. State of A.P., (2008) 3

SCC 512 : (2008) 1 SCC (L&S) 841] and Hemani Malhotra

[Hemani Malhotra v. High Court of Delhi, (2008) 7 SCC 11

: (2008) 2 SCC (L&S) 203] were the cases which pertained

to selections undertaken to fill up posts in judicial service.

In these cases, no minimum qualifying marks in interview 

236 [2024] 2 S.C.R.

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were required and the merit list was to be determined going

by the aggregate of marks secured by a candidate in the

written examination and the oral examination. By virtue

of stipulation of minimum qualifying marks for interview,

certain candidates, who otherwise, going by their aggregate

would have been in zone of selection, found themselves

to be disqualified. The stipulation of minimum qualifying

marks having come for the first time and after the selection

process was underway or through, this Court found such

exercise to be impermissible.

74. These were cases where, to begin with, there was no

stipulation of any minimum qualifying marks for interview.

On the other hand, in the present case, the requirement

in terms of Rule 2(1)(x) read with Rule 14 is that the

minimum qualifying marks as stipulated by the Government

must be obtained by a candidate to be considered eligible

for selection as Assistant Teacher. It was thus always

contemplated that there would be some minimum qualifying

marks. What was done by the Government by virtue of its

orders dated 7-1-2019 was to fix the quantum or number

of such minimum qualifying marks. Therefore, unlike the

cases covered by the decision of this Court in K. Manjusree

[K. Manjusree v. State of A.P., (2008) 3 SCC 512 : (2008)

1 SCC (L&S) 841], where a candidate could reasonably

assume that there was no stipulation regarding minimum

qualifying marks for interview, and that the aggregate of

marks in written and oral examination must constitute

the basis on which merit would be determined, no such

situation was present in the instant case. The candidate

had to pass ATRE 2019 and he must be taken to have

known that there would be fixation of some minimum

qualifying marks for clearing ATRE 2019.

75. Therefore, there is fundamental distinction between

the principle laid down in K. Manjusree [K. Manjusree v.

State of A.P., (2008) 3 SCC 512 : (2008) 1 SCC (L&S)

841] and followed in Hemani Malhotra [Hemani Malhotra

v. High Court of Delhi, (2008) 7 SCC 11 : (2008) 2 SCC

(L&S) 203] on one hand and the situation in the present

case on the other.

[2024] 2 S.C.R. 237

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

76. We are then left with the question whether prescription

of such minimum qualifying marks by order dated 7-1-

2019 must be set aside merely because such prescription

was done after the examination was conducted. At this

juncture, it may be relevant to note that the basic prayer

made in the leading writ petition before the Single Judge

was to set aside the order dated 7-1-2019. What could

then entail as a consequence is that there would be no

minimum qualifying marks for ATRE 2019, which would run

counter to the mandate of Rule 2(1)(x) read with clause

(c) of Rule 14. It is precisely for this reason that what was

submitted was that the same norm as was available for

ATRE 2018 must be adopted for ATRE 2019. In order to

lend force to this submission, it was argued that Shiksha

Mitras who appeared in ATRE 2018 and ATRE 2019 formed

a homogeneous class and, therefore, the norm that was

available in ATRE 2018 must be applied. This argument,

on the basis of homogeneity, has already been dealt with

and rejected.

77. If the Government has the power to fix minimum

qualifying marks “from time to time”, there is nothing in

the Rules which can detract from the exercise of such

power even after the examination is over, provided the

exercise of such power is not actuated by any malice or

ill will and is in furtherance of the object of finding the

best available talent. In that respect, the instant matter

is fully covered by the decisions of this Court in MCD v.

Surender Singh [MCD v. Surender Singh, (2019) 8 SCC 67

: (2019) 2 SCC (L&S) 464] and Jharkhand Public Service

Commission v. Manoj Kumar Gupta [Jharkhand Public

Service Commission v. Manoj Kumar Gupta, (2019) 20

SCC 178] . In the first case, the power entrusted under

Clause 25 of the advertisement also provided similar

discretion to the Selection Board to fix minimum qualifying

marks for each category of vacancies. While construing

the exercise of such power, it was found by this Court

that it was done “to ensure the minimum standard of the

teachers that would be recruited”. Similarly, in Jharkhand

Public Service Commission [Jharkhand Public Service 

238 [2024] 2 S.C.R.

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Commission v. Manoj Kumar Gupta, (2019) 20 SCC 178],

the exercise of power after the examination in Paper III

was over, was found to be correct and justified.

78. If the ultimate object is to select the best available

talent and there is a power to fix the minimum qualifying

marks, in keeping with the law laid down by this Court in

State of Haryana v. Subash Chander Marwaha [State of

Haryana v. Subash Chander Marwaha, (1974) 3 SCC 220

: 1973 SCC (L&S) 488], State of U.P. v. Rafiquddin [State

of U.P. v. Rafiquddin, 1987 Supp SCC 401 : 1988 SCC

(L&S) 183], MCD v. Surender Singh [MCD v. Surender

Singh, (2019) 8 SCC 67 : (2019) 2 SCC (L&S) 464] and

Jharkhand Public Service Commission v. Manoj Kumar

Gupta [Jharkhand Public Service Commission v. Manoj

Kumar Gupta, (2019) 20 SCC 178], we do not find any

illegality or impropriety in fixation of cut-off at 65-60% vide

order dated 7-1-2019. The facts on record indicate that

even with this cut-off the number of qualified candidates

is more than twice the number of vacancies available. It

must be accepted that after considering the nature and

difficulty level of examination, the number of candidates

who appeared, the authorities concerned have the requisite

power to select a criteria which may enable getting the

best available teachers. Such endeavour will certainly be

consistent with the objectives under the RTE Act.

79. In the circumstances, we affirm the view taken by the

Division Bench of the High Court and conclude that in

the present case, the fixation of cut-off at 65-60%, even

after the examination was over, cannot be said to be

impermissible. In our considered view, the Government

was well within its rights to fix such cut-off.”

19. In these two writ petitions, we are not, however, only concerned with

the “midway change of the Rule” Principle. But on that count also,

the ratio of the decisions cited by Mr. Gupta are distinguishable. The

three Judge Bench in Tej Prakash Pathak (supra) had referred to

the judgment in the case of Subhas Chandra Marwaha (supra) to

express doubt over correctness of the judgment in the case of K.

Manjusree (supra). As we have already observed, the ratio of K. 

[2024] 2 S.C.R. 239

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

Manjusree (supra) still holds the field. In the case of Ram Sharan

Maurya (supra), the Rules guiding recruitment empowered the

Government to stipulate qualifying marks of the particular selection

process to be such minimum marks as may be determined from

time to time by the Government. In this decision, the judgment itself

takes note of the decisions of this Court in K. Manjusree (supra)

and Hemani Malhotra (supra) and finds that the course for selection

to the posts involved in that case was different from that which was

found to be impermissible in K. Manjusree (supra) and Hemani

Malhotra (supra).

20. We find from Rule 18 of the 2001 Rules, the task of setting cut-off

marks has been vested in the High Court but this has to be done

before the start of the examination. Thus, we are also dealing with

a situation in which the High Court administration is seeking to

deviate from the Rules guiding the selection process itself. We have

considered the High Court’s reasoning for such deviation, but such

departure from Statutory Rules is impermissible. We accept the

High Court administration’s argument that a candidate being on the

select list acquired no vested legal right for being appointed to the

post in question. But if precluding a candidate from appointment is

in violation of the recruitment rules without there being a finding on

such candidate’s unsuitability, such an action would fail the Article

14 test and shall be held to be arbitrary. The reason behind the Full

Court Resolution is that better candidates ought to be found. That

is different from a candidate excluded from the appointment process

being found to be unsuitable.

21. Stipulations contained in Rule 21 of the 2001 Rules for making the

select list were breached by the High Court administration in adopting

the impugned resolution. The ratio of the decision in the case of

Ram Sharan Maurya (supra) would not apply in the facts of this

case and we have already discussed why we hold so.

22. Mr. Gupta’s stand is that applying a higher aggregate mark is not

barred under the said Rules or Regulations. We are, however,

unable to accept this submission. The very expression “aggregate”

means combination of two or more processes and in the event the

procedure for arriving at the aggregate has been laid down in the

applicable Rules, a separate criteria cannot be carved out to enable

change in the manner of making the aggregate marks. 

240 [2024] 2 S.C.R.

Digital Supreme Court Reports

23. So far as the ratio of the decision in the case of K. Manjusree

(supra) is concerned, that authority deals with change of the Rules

mid-way. In the case before us, in our opinion, if the High Court

is permitted to alter the selection criteria after the performance of

individual candidates is assessed, that would constitute alteration

of the laid down Rules. We refer to paragraphs Nos. 14 and 15 of

the judgment of the Constitution Bench in the case of Sivanandan

C.T. (supra), which lays down the principle of law on this point. We

reproduce below the said passages from this authority:-

“14. The decision of the High Court to prescribe a cut-off for

the viva-voce examination was taken by the Administrative

Committee on 27 February 2017 after the viva-voce was

conducted between 16 and 24 January 2017. The process

which has been adopted by the High Court suffers from

several infirmities. Firstly, the decision of the High Court

was contrary to Rule 2(c)(iii) which stipulated that the

merit list would be drawn up on the basis of the marks

obtained in the aggregate in the written examination and

the viva-voce; secondly, the scheme which was notified

by the High Court on 13 December 2012 clearly specified

that there would be no cut off marks in respect of the vivavoce; thirdly, the notification of the High Court dated 30

September 2015 clarified that the process of short listing

which would be carried out would be only on the basis of

the length of practice of the members of the Bar, should

the number of candidates be unduly large; and fourthly,

the decision to prescribe cut off marks for the viva-voce

was taken much after the viva-voce tests were conducted

in the month of January 2017.

15. For the above reasons, we have come to the conclusion

that the broader constitutional issue which has been referred

in Tej Prakash Pathak (supra) would not merit decision on

the facts of the present case. Clearly, the decision which was

taken by the High Court was ultra vires Rule 2(c)(iii) as it

stands. As a matter of fact, during the course of the hearing

we have been apprised of the fact that the Rules have

been subsequently amended in 2017 so as to prescribe a

cut off of 35% marks in the viva-voce examination which

however was not the prevailing legal position when the

present process of selection was initiated on 30 September

2015. The Administrative Committee of the High Court 

[2024] 2 S.C.R. 241

Sushil Kumar Pandey & Ors. v. The High Court of Jharkhand & Anr.

decided to impose a cut off for the viva-voce examination

actuated by the bona fide reason of ensuring that candidates

with requisite personality assume judicial office. However

laudable that approach of the Administrative Committee

may have been, such a change would be required to be

brought in by a substantive amendment to the Rules which

came in much later as noticed above. This is not a case

where the rules or the scheme of the High Court were

silent. Where the statutory rules are silent, they can be

supplemented in a manner consistent with the object and

spirit of the Rules by an administrative order.”

24. The ratio of this authority is squarely applicable in the facts of this

case. Submission on behalf of the High Court administration that

Rule 14 permits them to alter the selection criteria after the selection

process is concluded and marks are declared is not proper exposition

of the said provision. The said Rule, in our opinion, empowers the

High Court administration in specific cases to reassess the suitability

and eligibility of a candidate in a special situation by calling for

additional documents. The High Court administration cannot take aid

of this Rule to take a blanket decision for making departure from the

selection criteria specified in the 2001 Rules. The content of Rule

14 has the tenor of a verification process of an individual candidate

in assessing the suitability or eligibility.

25. We, accordingly, allow both the writ petitions by directing the High

Court to make recommendation for those candidates who have been

successful as per the merit or select list, for filing up the subsisting

notified vacancies without applying the Full Court Resolution that

requires each candidate to get 50 per cent aggregate marks. The

part of the Full Court Resolution of the Jharkhand High Court dated

23.03.2023 by which it was decided that only those candidates who

have secured at least 50% marks in aggregate shall be qualified for

appointment to the post of District Judge is quashed.

26. We expect the exercise of recommendation in terms of this judgment

to be completed as expeditiously as possible.

27. We do not find any reason to address the impleadment applications

as this judgment will cover the entire recommendation process.

Headnotes prepared by: Divya Pandey Result of the case:

Writ petitions allowed.