EX NAVY DIRECT ENTRY ARTIFICERS ASSOCIATION & ORS. versus THE UNION OF INDIA & ORS. on 8 May 2018

[2018] 4 S.C.R. 373

EX NAVY DIRECT ENTRY ARTIFICERS ASSOCIATION& ORS.

v.

THE UNION OF INDIA & ORS.

(Civil Appeal No. 6785 of 2014)

MAY 08, 2018

[A. K. SIKRI AND ASHOK BHUSHAN, JJ.]

Armed Forces:

Navy (Pension) Regulations, 1964 – Regns. 78 and 269 –Direct Entry Artificers of Navy – Pension – Entitlement of –Requirement of rendering of minimum service of 15 years – On facts,appellants engaged as Direct Entry Artificers prior to July 1976 –Claim of appellants that after their initial engagement period of 10years as Artificers, they were placed in Fleet Reserve for a periodof 10 years and as per Regulations, 50% of the period of Reservewhich is 5 years, to be counted for pension, thus, rendered 15 yearsof service to receive pensionary benefits – Respondents deniedplacement of appellants’ in Fleet Reserve for a period of 10 years –Held: As stipulated in Reg 269, liability to serve in the Fleet Reserve,if required, is only when such a Sailor is drafted into Fleet Reserve– There has to be a positive act of enrolment in the Fleet Reserve –Person who is enrolled as Artificer in the Indian Navy andcompletes 10 years’ of service, cannot presume that he standsautomatically enrolled in Fleet Reserve – On facts, no promise heldout to the appellants that after the completion of continuousservice of 10 years as Sailors, they would be drafted into FleetReserve – Even prior to the promulgation of policy fordiscontinuance of drafting into Fleet Reserve from 1976,respondent were clearly at liberty to decide if a Sailor is to beenrolled into Fleet Reserve or not – Further, in the absence of anysuch assurance of enrolment of drafting into Fleet Reserve, at thetime of initial recruitment, the Principle of Promissory Estoppelcannot be invoked – Thus, appellants not entitled to count 50% ofthe Fleet Reserve as they were never drafted into the said reserve –They are not entitled to reservist pension – However, their cases

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Awould be considered for grant of special pension – Further,appellants not entitled to be treated at par with the ApprenticeEntry Artificers for pension purposes.

Dismissing the appeal, the Court

HELD: 1.1 Once a person is enrolled as Sailor/Officer inBthe Indian Navy, he is liable to serve in the Indian Navy or in theIndian Naval Forces, as the case may be, until he is discharged,dismissed with disgrace, retired, permitted to resign or released.In the event of discharge, dismissal etc, i.e., at the time ofseverance from Naval service, every sailor has to be furnishedCwith a certificate in his mother tongue and also in English language.Such a certificate states the authority terminating his services;the cause of such termination; and the full period of service inthe Indian Navy and the Indian Naval Reserve Forces. In orderto become qualified to receive service pension, minimum serviceof 15 years is required. [Para 19][388-B-D]D

1.2 Calculating the qualifying period for the purpose ofpension and gratuity, entire service from the date of enrolmentor advancement to the rank of ordinary seaman or equivalent tillthe date of discharge is to be counted. Thus, whereas fullcontinuous service in the Navy is to be reckoned for pension,Einsofar Fleet Reserve is concerned those who are draftedthereinto are entitled to count 50% of the period of Fleet Reserveas reckonable service towards pension. [Para 20][388-E-F]

1.3 Insofar as, drafting into Fleet Reserve is concerned,Regulations in respect thereof provide as under: (i) Those SailorsFwho are having 10 years’ service as Sailors are eligible for draftingin Indian Fleet Reserve; (ii) As per Regulation 269, those whohave rendered 10 years’ service, their service is to be treated ascontinuous service. This Regulation further provides thatcontinuous service of Sailors of all branches shall be liable, ifGrequired, for a further 10 years’ service in the Indian FleetReserve; (iii) Regulation 4 of the Regulations for Indian FleetReserve lays down qualification criteria in respect of character,efficiency, medical status and age for joining the Fleet Service,which means only those who fulfill qualifications contained in H

Regulation 4 can be considered for drafting into Fleet Reserve.Further, Regulation 6 specifically declares that no person canjoin the Fleet Reserve as a matter of right. The manner ofenrolment is mentioned in Regulation 11, as per which,Commanding Officer has to make a specific recommendation forsuch an enrolment, i.e., he has to say as to whether or not he isrecommending a particular Sailor for Fleet Reserve service andhis service certificate has to be endorsed accordingly; and (iv) Incase of positive recommendation, a Fleet Reserve certificate hasto be issued to such a person on enrolment in Fleet Reserve.[Para 21][388-F-G; 389-A-C]

1.4 It is clear from that liability to serve in the Indian FleetReserve, if required, as stipulated in Regulation 269, is only whensuch a Sailor is drafted into Indian Fleet Reserve. There has tobe, thus, a positive act of enrolment in the Fleet Reserve. Aperson who is enrolled as Artificer in the Indian Navy andcompletes 10 years’ of service, cannot presume that he standsautomatically enrolled in Fleet Reserve. So far as appellant Nos.2 to 5 are concerned, there was no such enrolment in FleetReserve. [Paras 22, 23][389-D-E]

1.5 In fact, the appellants were conscious of the saidposition. That was the reason that Principle of PromissoryEstoppel was invoked on the ground that since their enrolmentwas prior to July 03, 1976, the decision of the Government ofIndia to discontinue transfer of Sailors into Fleet Reserve ascontained in communication dated July 03, 1976 is not bindingon them. Even if this Court proceed on that basis, the legal positionthat has been culled out from the relevant statutory provisionand enumerated herein, clearly shows that there was no promiseheld out to these appellants that after the completion of continuousservice of 10 years as Sailors, they would be drafted into FleetReserve. The tribunal has correctly remarked that at the time ofinitial enrolment no recruit can be given any guarantee/promiseof his being enrolled into Fleet Reserve as his performance inthe active service and recommendations he receives would decidehis eligibility for enrolment into Fleet Reserve. Therefore, evenprior to the promulgation of policy for discontinuance of drafting AB

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Ainto Fleet Reserve from 1976, respondent Nos. 1 and 2 wereclearly at liberty to decide if a Sailor is to be enrolled into FleetReserve or not. [Para 24][389-F-G; 390-A]

1.6 In the absence of any such assurance of enrolment ofdrafting into Fleet Reserve, at the time of initial recruitment, theBPrinciple of Promissory Estoppel cannot be invoked. The tribunalhas rightly concluded that mere recruitment/enrolment foractive as well as reserve service without making any order oftransfer to Indian Fleet Reserve under Regulation 269 of NavyRegulation Part III as well as Regulations of Indian FleetReserve, it cannot be treated that any promise was accorded toCthe appellants about drafting into Fleet Reserve, at any time.[Para 26][392-B-C]

Motilal Padampat Sugar Mills Co. Ltd. v. State of UttarPradesh & Ors. (1979) 2 SCC 409 : [1979] 2 SCR641 ; Bakul Cashew Co. & Ors. v. Sales Tax Officer,DQuilon & Anr. (1986) 2 SCC 365 : [1986] 1 SCR 610– referred to.

1.7 Question no.1 is answered in the negative and it is heldthat the appellants are not entitled to count 50% of the FleetReserve as they were never drafted into the said reserve.EConsequently, the appellants are not entitled to reservist pension.However, their cases would be considered for grant of specialpension on same lines as was done in T.R. Das judgment.[Para 28][394-D-E]

T.S. Das & Ors. v. Union of India & Anr. (2017) 4 SCCF218 : [2016] 6 SCR 541 – relied on.

2.1 Insofar as Apprentice Entry Artificers are concernedthey are getting pension and the appellants’ claim that sinceArtificer is one homogeneous class, whether the Entry theretois after completing the Apprenticeship course or it is a direct Gentry (as in the case of Appellants) all the Artificers are to betreated alike. There is no quarrel about this proposition. However,in the instant case, the concern is with the question as to whetherthe appellants are eligible for service pension even after theyhave rendered only 10 years of service (as they are held notentitled to count any period of Fleet Reserve in which they wereH

never drafted). Had Apprentice Artificers also got the pensionon rendition of 10 years’ service, there would have been someforce in the argument of the appellants. However, that is not so.Insofar as Apprentice Entry Artificers are concerned, they hadundergone 4 years’ training in Naval establishment. Thereafter,they were advanced to the rank of Artificer V and their initialengagement of 10 years’ active service commenced. After oneyear in the rank of Artificer Vth Class, these Apprentice EntryArtificers were advanced to the rank of Artificer acting IVth Class.In their cases, the training period of four years has been countedfor considering their eligibility for the purpose of pension.[Para 29][394-F-G; 395-A-B]

Anuj Kumar Dey & Anr. v. Union of India & Ors.(1997) 1 SCC 366 : [1996] 9 Suppl. SCR 269 –distinguished.

2.2 An attempt was made by the counsel for appellants toargue that Anuj Kumar Dey does not lay down correct law as thetraining period could not have been reckoned for calculatingqualifying period for pension. However, it is not open to theappellants to raise such an argument. In the first place, thisargument would not enure to the benefit of the appellants as itwould not entitle them to pension in any case. Even if thecontention of the appellants is presumed as correct, the only effectthereof would be to hold that even Apprentice Entry Artificer arenot entitled to pension. The counsel for appellants was candid inhis submission that he did not want Apprentice Entry Artificersto be deprived of their pension. Secondly, in any case, in theabsence of Apprentice Entry Artificers, such an argument cannotbe considered. Thirdly, the law laid down in Anuj Kumar has heldthe filed for more than 20 years and there is no reason to upsetthe same. For all these reasons, Question no. (2) is answeredagainst the appellants. [Para 30][395-E-G]

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ACIVIL APPELLATE JURISDICTION: Civil Appeal No. 6785of 2014.

From the Judgment and Order dated 22.01.2014 of the ArmedForces Tribunal, Regional Bench at Kochi in O. A. No. 8 of 2013 and25.03.2014 in R.A.No. 26 of 2014 in O. A.No. 8 of 2013.

BDr. K. Subba Rao, Ashwani Bhardwaj, Advs for the Appellants.Ms. V. Mohana, Sr. Adv, Gautam Sharma, V. Balaji, Mukesh KumarMaroria, Advs for the Respondents.

The Judgment of the Court was delivered by

A. K. SIKRI, J. 1. Appellant No. 1 is a registered AssociationCof Ex Navy Direct Entry Artificers, whereas appellant Nos. 2 to 5 areEx Direct Entry Artificers of the Navy. Primarily, it is the cause ofappellant Nos.2 to 5 which is espoused by their Association as well i.e.appellant No.1. These appellant Nos. 2 to 5 have rendered actual serviceof 10 years. For an Artificer to become entitled to pension, he is supposedto render minimum service of 15 years as per Regulation 78 of the NavyD(Pension) Regulations, 1964. The appellants claim that after their initialengagement period of 10 years as Artificers, they were placed in FleetReserve for a period of 10 years and as per Regulations, 50% of theperiod of Reserve is to be counted for the purpose of pension. On thatbasis, it is claimed that 5 years period of Reserve would enure to theirEbenefit and on adding this period of 5 years with actual service of 10years, it is to be treated that they have rendered 15 years of service andare accordingly entitled to receive pensionary benefits. The respondentsdeny the placement of appellant Nos. 2 to 5 in Fleet Reserve for aperiod of 10 years as claimed by the said appellants. Therefore, themoot question is as to whether the appellants, after rendering actualFservice of 10 years in the Navy, were drafted into Fleet Reserve or not.

2. The appellants had filed O.A. No. 8 of 2013 before the ArmedForces Tribunal (hereinafter referred to as the ‘AFT’), Regional Bench,Kochi in which prayer to grant benefit was sought by them. The AFT,however, has not accepted the case set up by the appellants. As aGresult, their O.A. stands dismissed by the AFT vide order dated January22, 2014. The appellants thereafter filed review petition seeking reviewof that judgment which was also dismissed by the AFT on March 25,2014. Simultaneously, however, prayer for leave to appeal to this Courthave been granted by the AFT seeking authoritative pronouncement ofHthis Court on the following questions of law formulated by the Tribunal:

“(1) Whether the applicants’ reserve liabilities imposed at the timeof enrolment ipso facto amounted to their being drafted to FleetReserve without any specific order to draft them to the Reserveon completion of regular Naval service? If so, whether the periodof such reserve liability as per the stipulated scheme was liable tobe taken into account for computing the length of service of theapplicants for pension purposes?

(2) Whether the applicants Nos. 2 to 5 were entitled to be treatedat par with the Apprentice Entry Artificers for pension purposesonly on the ground that both of them belong to the samehomogenous class of Artificers?

3. Both these orders passed in O.A. as well as in review petitionhave been assailed by the appellants by way of instant appeal preferredunder Section 30 of the Armed Forces Tribunal Act, 2007.

4. We now advert to the seminal facts which have led to thepresent litigation.

5. In the Indian Navy, the sailors are of two classes, the Artificersclass and the non-Artificer class. Artificers are considered to be skilledsailors and they work on sophisticated technologies of warships. For theArtificer Class, there are two channels of Entry, known as ApprenticeEntry Artificers and Direct Entry Artificers. The appellants joined IndianNavy as Direct Entry Artificers. At the relevant point of time (i.e. priorto July 3, 1976), the initial engagement of the Apprentice Entry Artificersas well as of the Direct Entry Artificers (appellants herein) was for 10years active service. On the expiry of this term, they could be draftedinto Fleet Reserve for a period of 10 years. A person who is kept inFleet Reserve can be recalled at any time, during the said period of 10years, to serve in the Navy.

6. The Apprentice Entry Artificers (with education qualificationof Matriculation) get 4 years training in Indian Navy during which periodthey get a special rate of pay (fixed stipend per month). After the 4years training period in naval establishment, the Apprentice EntryArtificers are advanced to the rank of Artificer Vth Class and theirinitial engagement of 10 years active service commences. At the end ofit, they could also be kept in Fleet Reserve for 10 years. It may bementioned that after one year in the rank of Artificer Vth Class, theseApprentice Entry Artificers are advanced to the rank of Artificer Acting AB

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AIVth Class to complete the engagement 10 years active service. On theother hand, Direct Entry Artificers, to which class appellants belong,with qualification of 3 years Diploma in Engineering from recognizedUniversities in the country are directly enrolled to the rank of ArtificerActing IVth Class with initial engagement of 10 years active service. Itmay also be stated that in the rank of Artificer Acting IVth Class, theBApprentice Entry Artificers and Direct Entry Artificers are mergedtogether, and are treated at par for the purposes of rank, work, promotions,pay and allowances, leave and other benefits allowed for sailors. Theyare all governed by the same Navy (Pension) Regulations, 1964. Intheir respective ranks, they relieve each other when transferred to shipsCand establishments.

7. These facts are noted, as stated by the appellants, because ofthe reason that the appellants are claiming that since Apprentice EntryArtificers are given the pension, after counting the 4 years training periodin Naval Establishment, same treatment be given to the appellants asDwell. Question No. 2 framed by the AFT and referred to this Courttouches upon this aspect.

8. Reverting to the facts of the appellants’ case, as pointed outabove, appellant Nos. 2 to 5 were engaged as Direct Artificers for aperiod of 10 years. All these appellants were engaged prior to July,E1976. This is the actual service rendered by them. According to them,they were drafted into Fleet Reserve for a period of 10 years and 50%of this period have been counted for pension. On that basis, they claimthat they have become entitled to receive pension. Therefore, they madea request on May 10, 2012 to the respondents to grant pension to them.However, vide reply dated June 25, 2012, respondents turned down theirFrequest as ‘not tenable in accordance with the extent rules/regulations’. The reason given by the respondents was that theappellants were not drafted into Fleet Reserve at all and, therefore, therewas no reason to count 50% of the Fleet Reserve period. Therespondents, in this behalf, referred to Government OrderGNo. AD/5374/2/76/2214/S/D(N.II) dated July 3, 1976 as per whichdrafting into Fleet Reserve was discontinued from 1976 onwards and,therefore, the appellants were never drafted into Fleet Reserve. Afterreceiving this rejection of their request, the appellants approach the AFTin the form of O.A. which has met the fate of dismissal, as alreadymentioned above.H

9. A perusal of the impugned judgment of the AFT would revealthat the appellants were enrolled into Navy under Regulation 268(1) ofthe Navy Regulations, Part III. Regulation 269 thereof provides for aninitial engagement of 10 years, followed by liability to remain 10 years inFleet Reserve. However, further 10 years service in Fleet Reserve issubject to regulations of Fleet Reserve. At the time of recruitment itselfof the appellants, it was made clear to them that they would be draftedinto Fleet Reserve only if required and regulations for Indian Fleet Reservespecifically stipulate that ‘no man can claim to join Fleet Reserve asa right’. Therefore, the appellants did not have any automatic right toget drafted into Fleet Reserve. In any case, in terms of Government’sletter dated July 3, 1976, transfer of sailors into Fleet Reserve wasdiscontinued and, therefore, no orders for drafting the appellants intoFleet Reserve were ever made. There is no notation on records thatthey are being drafted into Fleet Reserve on expiry of their active service.In this behalf, the AFT has quoted relevant portion of Government’sletter dated July 3, 1976 which is as under:

“SUB: CONDITIONS OF SERVICE OF SAILORS.

I am directed to state that the President is pleased to approve thefollowing modifications in the conditions of service of sailors:—

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(f) Transfer to Current Fleet Reserve:— Transfer of sailorsinto the Fleet Reserve to be discontinued. ———

3. Appropriate Government Regulations/Orders will be amendedin due course.”

10. The AFT also found that subsequently, Regulations for theNavy was amended by the Government of India vide SRO.No.106 of1978 dated 28th March 1978. Relevant portions of the SRO are givenbelow:

“S.R.O.106:— In exercise of the powers conferred by section184 of the Navy Act, 1957 (62 of 1957), the Central Governmenthereby makes the following regulations further to amend the NavyCeremonial, Conditions of Service and Miscellaneous Regulations,1964, namely:—

2. In the Naval Ceremonial, Conditions of Service andMiscellaneous Regulations, 1964—

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(i) in regulation 269, in sub-regulation (1), for the brackets andfigure “(1)”, the brackets, figure and words “(1) Old Entrants”shall be substituted, and after subregulation (1) as so amended,the following sub-regulation shall be inserted, namely:—

“(1A) New Entrants:—(a) Boys, Artificer, Apprentices andDirect Entry sailors may be enrolled for a period calculated topermit a period of 15 years’ service to be completed from thedate of enrolment or from the date of attaining the age of 17years, whichever is later, provided their services are so longrequired.

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(1B)(a) In case of the existing sailors, their period of engagementshall be governed by sub-regulation (1), except that they shall notbe transferred to Fleet Reserve.

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(1C) Persons joining service on or after the 3rd July, 1976 shall bedeemed to be New Entrants.”

11. After going through the various provisions of Navy Act, NavyRegulations, Part III and the aforesaid amendments, the AFT culled outthe relevant features in the form of salient points in the following manner:

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“25. Salient points that emerge from the above Regulations, whichare of relevance in this case are:—

(a) Sailors having 10 years continuous service shall be liable, ifrequired, for further service in Indian Fleet Reserve, subject toprovisions of Regulations for Indian Fleet Reserve (Regulation269).

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(b) When an active service rating is within six months ofcompletion of his term of enrollment, the CommandingOfficer has to inform the Registrar of Reserves whether ornot he is recommended for Fleet Reserve Service and hisservice certificate is to be endorsed accordingly (Regulation11 of Fleet Reserve).

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(c) Qualifications have been specified for enrolment into FleetReserves. Joining Reserves is not a Right (Regulations 4 and6 of Fleet Reserves).

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(d) Recruiting officers are mandated to explain and make therecruits fully understand terms and conditions of service andliabilities before they are enrolled into the Navy (Regulation 264of Regulations for the Navy).

(e) A Fleet Reservist Certificate will be issued to each person onenrolment in Fleet Reserves.

26. It is evident from the Regulations that a Sailor after his activeservice has to be drafted into Fleet Reserve and it is not anautomatic re-enrollment. There is no specific claim or right to jointhe Fleet Reserve as there are terms and conditions which haveto be fulfilled by a person before he can be drafted into FleetReserve. It is also evident that, at the time of initialenrollment no recruit can be given any guarantee/promiseof his being enrolled into Fleet Reserve as his performancein the active service and recommendations he receiveswould decide his eligibility for enrollment into FleetReserve. Therefore even prior to the promulgation of policy fordiscontinuance of drafting into Fleet Reserve from 1976,Respondents 1 and 2 were clearly at liberty to decide if a Sailor isto be enrolled into Fleet Reserve or not. In view of the above, wecannot agree with the submission of the learned counsel forapplicants that they were made to understand anything else.”

12. The appellants advanced two arguments before the AFT. Inthe first instance, it was argued that at the time of their recruitment intothe service, which was before the Government’s order dated July 3,1976 was passed, they were given to understand that they would berendering 10 years of active service followed by 10 years of Fleet Service.Thus, they understood that 50% of the Fleet Service was counted towardspension to enable them to receive pension. Hence, the Governmentwas bound by Principle of Promissory Estoppel to accord the aforesaidbenefit to them. Second argument advanced by the appellants was thatthe appellants, namely, Direct Entry Artificers and Apprentice EntryArtificers formed a homogenous class. Thus, when pensionary benefitswere accorded to the Apprentice Entry Artificers, there was no reasonto deny the same to the appellants and such a denial was discriminatoryand violated the provisions of Article 14 of the Constitution of India.Both these contentions have been negated by the AFT. At the sametime, as already noticed above, on both these aspects, questions of lawhave been framed while granting leave to appeal to the appellants.

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A13. We now proceed to take up the two questions for ourconsideration.

Question No. 1 - Whether the applicants’ reserve liabilitiesimposed at the time of enrolment ipso facto amounted to their beingdrafted to Fleet Reserve without any specific order to draft them to theBReserve on completion of regular Naval service? If so, whether theperiod of such reserve liability as per the stipulated scheme was liable tobe taken into account for computing the length of service of the applicantsfor pension purposes?

14. To find an answer to the aforesaid question, we shall have toCtraverse through some relevant provisions of the Navy Act, the NavalRegulations Part-III as well as decision taken by the Government todiscontinue with the policy of drafting into Fleet Reserve. Insofar asNavy Act is concerned, following provisions therefrom are relevant fordeciding the controversy.

D“14. Liability for service of officers and sailors:—

(1) Subject to the provisions of sub-section (4), officers and sailorsshall be liable to serve in the Indian Navy or the Indian NavalReserve Forces, as the case may be, until they are duly discharged,dismissed with disgrace, retired, permitted to resign, or released.

17. Provisions as to discharge.—(4) Every sailor who is dismissed,Edischarged, retired, permitted to resign or released from serviceshall be furnished by the prescribed officer with a certificate inthe language which is the mother tongue of such sailor and also inthe English language setting forth—

(a) the authority terminating his service; F

(b) the cause for such termination; and

(c) the full period of his service in the Indian Navy and the IndianNaval Reserve Forces.

[184A. Power to make regulations with retrospective effect.—The power to make regulations conferred by this Act shall includeGthe power to give retrospective effect, from a date not earlierthan the date of commencement of this Act, to the regulations orany of them, but no retrospective effect shall be given to anyregulation so as to prejudicially affect the interests of any personto whom such regulation may be applicable.”

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15. The relevant regulations from the Pension Regulations for theNavy, 1964 are re-produced below:

“78. Minimum qualifying service for pension – Unless otherwiseprovided, the minimum service which qualifies for servicepension is fifteen years.

79. Service qualifying for pension and gratuity – (1) All servicefrom the date of enrolment or advancement to the rank ofordinary seaman or equivalent to the date of discharge shall qualifyfor pension or gratuity with the exception of ——

87. Sailors transferred to the reserve—A sailor transferred to thereserve after earning a service pension shall be granted suchpension from the date of his transfer.

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92. Reservist pension and gratuity—(1) A reservist who is not inreceipt of a service pension may be granted, on completion of theprescribed naval and reserve qualifying service of ten years each,a reservist pension of rupees eleven per mensem or a gratuity ofrupees nine hundred in lieu of pension.

(2) A reservist who is not in receipt of a service pension andwhose qualifying service is less than the period of engagementbut not less than fifteen years may, on completion of the period ofengagement or on earlier discharge from the serve otherwise thanat his own request, be granted a reservist pension at rupees sevenhundred and fifty in lieu of pension.”

16. Navy Regulations Part III laid down the conditions of serviceof sailors in the Navy. Some of the provisions thereof, with which weare concerned, are as under:

“261. Recruitment – The Chief of the Naval Staff may recruitsailors required for the Service.

(2) Recruitment of sailors shall be made through boy entry, artificerapprentice entry, and direct entry, as necessary….

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268. Engagements – (1) Boys, Artificer Apprentices and DirectEntry sailors shall be enrolled for co0ntinuous service as providedin sub-regulation (1) of Regulation 269.

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269. Continuous Service – (a) Old Entrants Boys, ArtificerApprentices and Direct Entry sailors may be enrolled for a periodcalculated to permit a period of 10 years’ service to be completedfrom the date of attaining 17 years of age or from the date ofbeing ranked in the Man’s rank on successful completion of initialtraining, whichever is later, provided their services are so longrequired.

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Continuous Service sailors of all Branches shall be liable, if required,for a further 10 years’ service in the Indian Fleet Reserve, subjectto the provisions of the Regulation for the Indian Reserve.

(1-A) New Entrants:-

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(a) Boys, Artificer-Apprentices and Direct Entry sailors may beenrolled for a period calculated to permit a period of 15 yearsservice to be completed from the date of attaining the age of 17years, whichever is later, provided their services are so longrequired.

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(1-B) (a) In case of the existing sailors, their period of engagementshall be governed by sub regulation (1) except that they shall notbe transferred to Fleet Reserve.

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(1-C) Persons joining service on or after the 3[rd] July, 1976 shallbe deemed to be New Entrants.”

17. It will also be apt to reproduce Regulation 269 (unamended)Fas it existed prior to the amendments carried out in the year 1978, whichis as follows:

“269. Continuous Service: – (1) Boys, Artificer Apprentices andDirect Entry sailors may be enrolled for a period calculated topermit a period of 10 years’ service to be completed from thedate of attaining 17 years of age or from the date of being rated inthe Mans rate on successful completion of initial training, whicheveris later, provided their services are so long required.

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Continuous Service sailors of all Branches shall be liable, if required,for a further 10 years’ service in the Indian Fleet Reserve, subjectto the provisions of the Regulations for the Indian Fleet Reserve.”

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18. We have already reproduced portions of Government of India’sdecision dated 3[rd] July, 1976 whereby transfer of Sailors into Fleet Reservewas discontinued. Likewise, we have already extracted the relevantportions of SRO 106 dated 28[th] March, 1976. In addition, it would alsobe pertinent to note Regulations for Indian Fleet Reserve which are asfollows:

“4. Regulation 4, lays down Qualification criteria in respect ofCharacter, Efficiency, Medical Status and Age for joining the fleetreserve.

6. Claim to join Fleet Reserved:—No man can claim to join theFleet Reserve as a right.

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11. Enrolment:— The Registrar of Reserves is authorized to enrolor re-enrol ratings in the Royal Indian Fleet Reserve, acting underthe authority of the Officer Commanding the Royal Indian Navy.

(a) When an Active Service rating is within six months ofcompleting his terms of enrolment the Commanding Officer ofthe ship in which he is serving is to inform the Registrar whetheror not he is recommended for Fleet Reserve Service and is toendorse his Service Certificate accordingly.

13. Fleet Reservist Certificate:— Every man on enrollment orre-enrollment in Royal Indian fleet Reserve is to be issued with aFleet Reservist Certificate (Form RINF.3P). This certificateidentifies the man as a member of the Royal Indian Fleet Reserveand contains a detachable Emergency Movement Order for useon General Mobilisation.

19. Regulation 19 lays down mandatory training period forreservists.

21. Notations on Service Certificates:— On the conclusion ofeach period of training the Registrar will cause the followinginformation to be entered in the Service Certificates of the ratingsconcerned:—

(a) Character.

(b) Ability in substantive rating held.

(c) Fitness to hold non-substantive rating (vide Article 7(v)]

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AThe Registrar is to sign the Service Certificate on page 4 as beingsatisfied that the prescribed training has been carried out and thatthe man is in possession of his Fleet Reservist Certificate andknow where to report on mobilization.”

19. Following position emerges from the conjoint reading of theBaforesaid provisions:

(i) Once a person is enrolled as Sailor/Officer in the Indian Navy,he is liable to serve in the Indian Navy or in the Indian Naval Forces, asthe case may be, until he is discharged, dismissed with disgrace, retired,permitted to resign or released.

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(ii) In the event of discharge, dismissal etc, i.e., at the time ofseverance from Naval service, every sailor has to be furnished with acertificate in his mother tongue and also in English language. Such acertificate states the authority terminating his services; the cause ofsuch termination; and the full period of service in the Indian Navy andDthe Indian Naval Reserve Forces.

(iii) In order to become qualified to receive service pension,minimum service of 15 years is required.

20. Calculating the qualifying period for the purpose of pensionEand gratuity, entire service from the date of enrolment or advancementto the rank of ordinary seaman or equivalent till the date of discharge isto be counted. Thus, whereas full continuous service in the Navy is tobe reckoned for pension, insofar Fleet Reserve is concerned those whoare drafted thereinto are entitled to count 50% of the period of FleetReserve as reckonable service towards pension.F

21. Insofar as, drafting into Fleet Reserve is concerned, Regulationsin respect thereof provide as under:

(i) Those Sailors who are having 10 years’ service as Sailors areeligible for drafting in Indian Fleet Reserve.

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(ii) As per Regulation 269, those who have rendered 10 years’service, their service is to be treated as continuous service. ThisRegulation further provides that continuous service of Sailors of allbranches shall be liable, if required, for a further 10 years’ service in theIndian Fleet Reserve.H

(iii) Regulation 4 of the Regulations for Indian Fleet Reserve laysdown qualification criteria in respect of character, efficiency, medicalstatus and age for joining the Fleet Service, which means only thosewho fulfill qualifications contained in Regulation 4 can be considered fordrafting into Fleet Reserve. Further, Regulation 6 specifically declaresthat no person can join the Fleet Reserve as a matter of right. Themanner of enrolment is mentioned in Regulation 11, as per which,Commanding Officer has to make a specific recommendation for suchan enrolment, i.e., he has to say as to whether or not he is recommendinga particular Sailor for Fleet Reserve service and his service certificatehas to be endorsed accordingly.

(iv) In case of positive recommendation, a Fleet Reserve certificatehas to be issued to such a person on enrolment in Fleet Reserve.

22. It is clear from the above that liability to serve in the IndianFleet Reserve, if required, as stipulated in Regulation 269, is only whensuch a Sailor is drafted into Indian Fleet Reserve. There has to be, thus,a positive act of enrolment in the Fleet Reserve. A person who is enrolledas Artificer in the Indian Navy and completes 10 years’ of service, cannotpresume that he stands automatically enrolled in Fleet Reserve.

23. So far as Appellant Nos. 2 to 5 are concerned, there was nosuch enrolment in Fleet Reserve.

24. In fact, the appellants were conscious of the aforesaid position.That was the reason that Principle of Promissory Estoppel was invokedon the ground that since their enrolment was prior to July 03, 1976, thedecision of the Government of India to discontinue transfer of Sailorsinto Fleet Reserve as contained in communication dated July 03, 1976 isnot binding on them. Even if we proceed on that basis, the legal positionthat has been culled out from the relevant statutory provision andenumerated above, clearly shows that there was no promise held out tothese appellants that after the completion of continuous service of 10years as Sailors, they would be drafted into Fleet Reserve. The Tribunalhas correctly remarked that at the time of initial enrolment no recruitcan be given any guarantee/promise of his being enrolled into FleetReserve as his performance in the active service and recommendationshe receives would decide his eligibility for enrolment into Fleet Reserve.Therefore, even prior to the promulgation of policy for discontinuance ofdrafting into Fleet Reserve from 1976, Respondent Nos. 1 and 2 were AB

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Aclearly at liberty to decide if a Sailor is to be enrolled into Fleet Reserveor not. It may be pertinent to mention that the aforesaid view of ourshas not been taken for the first time. We are not treading on uncharteredterritory. Precisely, this very question has been decided by a three JudgeBench of this Court in T.S. Das & Ors. v. Union of India & Anr.[1].The factual background in which the aforesaid judgment is rendered isBidentical as can be seen from the following question posed therein fordetermination:

“25. In the absence of an express order of the competentauthority to take the applicants on the Fleet Reserve Service, themoot question is: whether the applicants can be treated as deemedto be in the Fleet Reserve Service on account of the stipulation inthe appointment letter—that on completion of 10 years of navalservice as a Sailor, they may have to remain on Fleet ReserveService for another 10 years. That condition in the appointmentletter cannot be read in isolation. The governing workingconditions of Sailors must be traced to the provisions in the 1957Act or the Regulations framed thereunder concerning serviceconditions. From the provisions in the 1957 Act, there is nothing toindicate that the Sailor after appointment or enrolment is“automatically” entitled to continue in Fleet Reserve Serviceafter completion of initial active service period of 10 years. Theprovisions, however, indicate that on completion of initial activeservice of 10 years or enhanced period as per the amendedprovisions is entitled to take discharge in terms of Section 16 ofthe Act. The applicants assert that none of the applicants optedfor discharge. That, however, does not mean that they would or infact have continued to be on the Fleet Reserve Service afterexpiration of the term of active service as a Sailor. There ought tohave been an express order issued by the competent authority todraft the applicant concerned in the Fleet Reserve Service. In theabsence of such an order, on completion of the term of service ofengagement, the Sailor concerned would stand discharged.Concededly, retention on the Fleet Reserve Service is theprerogative of the employer, to be exercised on case-to-casebasis. In the present case, however, on account of a policydecision, the Fleet Reserve Service was discontinued in terms ofNotification dated 3-7-1976.”

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H1(2017) 4 SCC 218

EX NAVY DIRECT ENTRY ARTIFICERS ASSOCIATION& ORS. v. THE UNION OF INDIA & ORS. [A. K. SIKRI, J.]

25. The Court reproduced the aforesaid notification dated July 7,1976 and continue with the discussion in the following manner:

“27. As noted hitherto, none of the relevant provisions evenremotely suggest that the Sailor is “automatically” transferred tothe Fleet Reserve Service. Whereas, it is expressly provided thaton expiration of the term of service of engagement the Sailorwould be placed on Fleet Reserve Service only if an expressorder in that behalf is passed by the competent authority to drafthim on the Fleet Reserve and not otherwise. Section 16 of theAct merely gives an option to the Sailor to take a discharge afterexpiration of term of service of engagement. It is not a deemingprovision that if such option is not exercised by the Sailorconcerned, he would be treated as having been drafted on theFleet Reserve Service for another 10 years “automatically”.

28. Regulation 269 spells out the conditions of service. Itreinforces the position that the services of a Sailor would becontinued “so long required” or “if required”. The second part ofsub-regulation (1) of that Regulation uses the expression “ifrequired”, for further 10 years’ service in the Indian FleetReserve, subject to the provisions of the Regulations for theIndian Fleet Reserve. This view taken by the Tribunal (PrincipalBench, New Delhi) in Niranjan Chakroborty v. Union ofIndia [Niranjan Chakroborty v. Union of India, 2010 SCCOnLine AFT 803] commends to us.

29. As aforesaid, on introducing the new policy on 3-7-1976, theFleet Reserve was discontinued and instead the Sailors in serviceat the relevant time were given an option to continue in activeservice for a further term of 5 years. Some of the Sailors opted tocontinue till completion of 15 years, who, then became eligible for“service pension” having qualifying service.

30. The quintessence for grant of reservist pension, as perRegulation 92, is completion of the prescribed Naval and Reservequalifying service of 10 years “each”. Merely upon completion of10 years of active service as a Sailor or for that matter continuedbeyond that period, but falling short of 15 years or qualifyingReserve Service, the Sailor concerned cannot claim benefitunder Regulation 92 for grant of reservist pension. For, to qualifyfor the reservist pension, he must be drafted to the Fleet Reserve AB

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AService for a period of 10 years. In terms of Regulation 6 of theIndian Fleet Reserve Regulations, there can be no claim to jointhe Fleet Reserve as a matter of right. None of the applicantswere drafted to the Fleet Reserve Service after completion oftheir active service. Hence, the applicants before the Tribunal,could not have claimed the relief of reservist pension...”B

26. In the absence of any such assurance of enrolment ofdrafting into Fleet Reserve, at the time of initial recruitment, thePrinciple of Promissory Estoppel cannot be invoked. The Tribunal has,in this behalf, taken note of certain judgments[2] of this Court and on thatbasis rightly concluded that mere recruitment/enrolment for active asCwell as reserve service without making any order of transfer to IndianFleet Reserve under Regulation 269 of Navy Regulation Part III as wellas Regulations of Indian Fleet Reserve, it cannot be treated that anypromise was accorded to the appellants about drafting into FleetReserve, at any time. We would, at this juncture, like to reproduce paraD31 of T.R. Das case.

“31. The original applicants contend that if the Government Policydated 3-7-1976 is applied to the serving Sailors, inevitably, it willresult in retrospective application thereof to their detriment. Thatis forbidden by Section 184-A of the Act. This argument does notcommend to us. In that, the effect of the Government Policy is toEdisband the establishment of the Reserve Fleet Service witheffect from 3-7-1976. As found earlier, drafting of Sailors to theReserve Fleet Service was not automatic, but dependent on anexpress order to be passed by the competent authority in thatbehalf on case-to-case basis. The Sailors did not have a vested orFaccrued right for being placed in the Reserve Fleet Service. Hence,no right of the Sailors in active service was affected or takenaway because of the Policy dated 3-7-1976...”

27. It would, however, be pertinent to mention here that in T.R.Das, though the Court had specifically held that such direct EntryArtificers were not entitled to reservist pension, they were entitled forGspecial pension, in terms of Regulation 95 of the Pension Regulations.The relevant portion of the discussion which ensued on this aspect iscontained in paras 34 and 36 of the judgment in T.R. Das and theseparas read as under:

2 Motilal Padampat Sugar Mills Co. Ltd. v. State of Uttar Pradesh & Ors. (1979) 2 SCCH409; Bakul Cashew Co. & Ors. v. Sales Tax Officer, Quilon & Anr. (1986) 2 SCC 365

“34. The next question is whether the Sailors appointed before1973 were entitled to a special pension, in terms of Regulation 95of the Pension Regulations. Indeed, this is a special provision andcarves out a category of Sailors, to whom it must apply.Discretion is vested in the Central Government to grant specialpension to such Sailors, who fall within the excepted category.Two broad excepted categories have been noted in Regulation95. Firstly, Sailors who have been discharged from their duties inpursuance of the government policy of reducing the strength ofestablishment of the Indian Navy; or secondly, of reorganisation,which results in paying off of any ships or establishment. In thepresent case, clause (i) of Regulation 95 must come into play, inthe backdrop of the policy decision taken by the Government asenunciated in the Notification dated 3-7-1976. On and from thatdate, concededly, the Fleet Reserve Service has beendiscontinued. That, inevitably results in reducing the strength ofthe establishment of the Fleet Reserve of the Indian Navy to thatextent, after coming into force of the said policy. None of theSailors have been or could be drafted to the Fleet Reserve aftercoming into force of the said policy—as that establishment didnot exist anymore and the strength of establishment of the IndianNavy stood reduced to that extent. Indisputably, the Sailorsappointed prior to 3-7-1976, had the option of continuing on theFleet Reserve Service after expiration of their active service/empanelment period. As noted earlier, in respect of eachapplicants the appointment letter mentions the period ofappointment as 10 years of initial active service and 10 yearsthereafter as Fleet Reserve Service, if required. The option tocontinue on the Fleet Reserve Service could not be offered tothese applicants and similarly placed Sailors, by the Department,after expiration of their empanelment period of 10 years or lessthan 15 years as the case may be. It is for that reason, suchSailors were simply discharged on expiration of their activeservice/empanelment period. In other words, on account ofdiscontinuation of the Fleet Reserve establishment of the IndianNavy, in terms of Policy dated 3-7-1976 it has entailed in reducingthe strength of establishment of the Indian Navy to that extent.

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36. Thus understood, all Sailors appointed prior to 3-7-1976 andwhose tenure of initial active service/empanelment period expiredon or after 3-7-1976 may be eligible for a special pension underRegulation 95, subject, however, to fulfilling other requirements.In that, they had not exercised the option to take discharge onexpiry of engagement (as per Section 16 of the 1957 Act) and yetwere not and could not be drafted by the competent authority tothe Fleet Reserve because of the policy of discontinuing the FleetReserve Service w.e.f. 3-7-1976. The cases of such Sailors (notlimited to the original applicants before the Tribunal) must beconsidered by the competent authority within three months forgrant of a “special pension” from three years prior to the date ofapplication made by the respective Sailor and releasepayment after giving adjustment of gratuity anddeath-cum-retirement-gratuity (DCRG) already paid to them fromarrears. They shall be entitled for interest @ 9% p.a. on thearrears, till the date of payment.”

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28. We, thus, answer question no. 1 in the negative and hold thatthe appellants are not entitled to count 50% of the Fleet Reserve as theywere never drafted into the said reserve. Consequently, the appellantsare not entitled to reservist pension. However, their cases would beconsidered for grant of special pension on same lines as was done inET.R. Das judgment and directed in para 36 of the said judgment.

Question No. 2 - Whether the applicants Nos. 2 to 5 wereentitled to be treated at par with the Apprentice Entry Artificers forpension purposes only on the ground that both of them belong to thesame homogeneous class of Artificers?

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29. Insofar as Apprentice Entry Artificers are concerned theyare getting pension and the appellants’ claim that since Artificer is onehomogeneous class, whether the Entry thereto is after completing theApprenticeship course or it is a direct entry (as in the case of Appellants)all the Artificers are to be treated alike. There is no quarrel about thisGproposition. However, in the instant case, we are concerned with thequestion as to whether the appellants are eligible for service pensioneven after they have rendered only 10 years of service (as they are heldnot entitled to count any period of Fleet Reserve in which they werenever drafted). Had Apprentice Artificers also got the pension on H

rendition of 10 years’ service, there would have been some force in theargument of the appellants. However, that is not so. As already notedabove, insofar as Apprentice Entry Artificers are concerned, they hadundergone 4 years’ training in Naval establishment. Thereafter, theywere advanced to the rank of Artificer V and their initial engagement of10 years’ active service commenced. After one year in the rank ofArtificer Vth Class, these Apprentice Entry Artificers were advancedto the rank of Artificer acting IVth Class. In their cases, the trainingperiod of four years has been counted for considering their eligibility forthe purpose of pension. This has happened pursuant to the judgment ofthis Court in Anuj Kumar Dey & Anr. v. Union of India & Ors.[3]. Inthe cases of Apprentice Entry Artificers, the Government had refusedto reckon the period for the purpose of pension. The question beforethis court was as to whether the training period spent on ApprenticeArtificers was liable to be taken into account for pension purposes. TheCourt decided the question in favour of the Apprentice Entry Artificers.Thus, these Apprentice Entry Artificers became entitled to pension onthe inclusion of training period towards the service. Their case is, therefore,entirely different from the appellant’ who are Direct Entry Artificersand had no benefit of such training.

30. An attempt was made by learned counsel for appellants toargue that Anuj Kumar Dey does not lay down correct law as thetraining period could not have been reckoned for calculating qualifyingperiod for pension. However, it is not open to the appellants to raise suchan argument. In the first place, this argument would not enure to thebenefit of the appellants as it would not entitle them to pension in anycase. Even if the contention of the appellants is presumed as correct,the only effect thereof would be to hold that even Apprentice EntryArtificer are not entitled to pension. We may note, however, that learnedcounsel for appellants was candid in his submission that he did not wantApprentice Entry Artificers to be deprived of their pension. Secondly, inany case, in the absence of Apprentice Entry Artificers, such an argumentcannot be considered. Thirdly, the law laid down in Anuj Kumar Deyhas held the filed for more than 20 years and there is no reason to upsetthe same. For all these reasons, we reject the contention and answerQuestion no. (2) against the appellants.

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396SUPREME COURT REPORTS

A31. As a consequence, this appeal stands dismissed insofar asclaim for reservist pension is concerned. However, their cases for grantof special pension shall be considered as directed above.