1961 (11) TMI 69 - SC - Indian Laws

Summary

Issues Involved:
1. Entitlement to passage benefits under the Superior Civil Services (Revision of Pay and Pension) Rules, 1924.
2. Validity of the retrospective cancellation of passage benefits by the All India Services (Overseas Pay, Passage and Leave Salary) Rules, 1957.
3. Constitutional guarantee of service conditions under Article 314 of the Constitution of India.

Issue-wise Detailed Analysis:

1. Entitlement to Passage Benefits under the Superior Civil Services (Revision of Pay and Pension) Rules, 1924:
The respondent, a member of the Indian Civil Service, was entitled to passage benefits under the Superior Civil Services (Revision of Pay and Pension) Rules, 1924, which were framed by the Secretary of State for India-in-Council under s.96B(2) and (3) of the Government of India Act, 1919. Rule 12 of the Statutory Rules provided that passage pay shall be granted to the members of the services and holders of appointments enumerated in Appendix A to that Schedule. The passage benefits were originally part of the salary, with a sum of Rs. 50 per mensem being credited to a General Passage Fund. Amendments in 1926 changed the scheme to maintain separate passage accounts for each officer and their family members, turning the passage benefits into an allowance or privilege rather than part of the salary.

2. Validity of the Retrospective Cancellation of Passage Benefits by the All India Services (Overseas Pay, Passage and Leave Salary) Rules, 1957:
In 1957, the Government of India framed the All India Services (Overseas Pay, Passage and Leave Salary) Rules, 1957, which retrospectively canceled the passage benefits from July 12, 1956. The respondent protested against this cancellation, and while the Government of India granted passage benefits to the respondent, it declined to extend the same to his wife and children. The High Court issued a writ of mandamus commanding the Accountant General to pay the prescribed passage money for the respondent's wife and children. The Supreme Court upheld the High Court's decision, declaring that the retrospective cancellation of passage benefits was ultra vires.

3. Constitutional Guarantee of Service Conditions under Article 314 of the Constitution of India:
The conditions of service, including passage benefits, were guaranteed to members of the Indian Civil Service by s.247(1) of the Government of India Act, 1935, and further protected by s.10(2) of the Indian Independence Act, 1947. Article 314 of the Constitution ensured that persons appointed by the Secretary of State to a civil service of the Crown in India would continue to receive the same conditions of service as respects remuneration, leave, and pension. The Supreme Court held that the passage benefits, originally part of the salary and later an allowance or privilege, were part of the remuneration guaranteed under Article 314. The central Government's rule-making power could not override this constitutional guarantee.

Conclusion:
The Supreme Court concluded that the rule-making power exercised by the central Government in framing the All India Services (Overseas Pay, Passage and Leave Salary) Rules, 1957, was incompetent to destroy or cancel the constitutional guarantee of service conditions under Article 314. Therefore, the retrospective cancellation of passage benefits was declared ultra vires, and the appeal was dismissed with costs.