Govt Servant Has No Vested Right To Seek Promotion As Per Old Rules Merely Because Vacancies Arose Earlier: Supreme Court

The Supreme Court on Monday (May 18) held that government employees do not possess a vested right to seek promotion under old service rules merely because vacancies had arisen before the introduction of new rules.

The Court held that the government is competent to alter the method, criteria, or procedure for selection and promotion at any stage by introducing new service rules, provided that they are not arbitrary.

A bench of Justice Dipankar Datta and Justice Augustine George Masih heard the appeals where the Respondent-employees, who were employed in State Transport Department on Junior level, and later on promoted to a Senior Level, claimed a promotion to the post of Assistant Regional Transport Officer (Senior Assistant), which had arisen during the during the applicability of the old Rules making eligible those employees who have completed five years of service on the post of Grade I Assistant, however the State Government denied the same, stating that mere arisen of the vacancies during the applicability of the Old Rules would not ipso facto grant any vested right upon the employees to claim a promotion, as the government is empowered to restructure the cadre and change the mode of the selection from being promotional to a selective one.

Background

The dispute arose from claims made by two employees, who sought promotion to the post of ARTO under executive instructions issued in 1981. Those instructions permitted promotion of eligible Senior Assistants to the ARTO post on the basis of merit and suitability.

However, before the promotions could take place, the Odisha Government restructured the cadre in 2017. The ARTO post was upgraded from a Group C post to a Group B post, the appointing authority was changed from the Transport Commissioner to the Government, and eventually, the Odisha Transport Service Rules, 2021 were framed under Article 309 of the Constitution.

Under the 2021 Rules, the ARTO post became a selection post to be filled through a competitive examination conducted by the Odisha Public Service Commission (OPSC), superseding all previous executive instructions.

Despite this restructuring, the High Court directed the State to convene a DPC and consider the respondents for promotion under the earlier regime. The High Court also restrained the State from filling certain vacancies through the new recruitment process.

Challenging these directions, the State argued before the Supreme Court that the ARTO post was not a promotional post but a selection post, and therefore the employees could not insist on consideration under the old executive instructions merely because they became eligible while those instructions were in force.

Decision

Setting aside the impugned decisions, the Judgment authored by Justice Datta allowed the State's appeal, noting that there is no universal rule that vacancies must necessarily be filled under the rules existing on the date when the vacancies arose. [See State of H.P. v. Raj Kumar, 2022 LiveLaw (SC) 502]

“The Government, in the present case, chose not to fill the posts of Assistant Regional Transport Officer. This was in view of restructuring of the cadre and to enforce the 2021 Rules, which is in conformity with the law. The proposition that vacancies must be filled up by promotion in accordance with the rules which existed on the date such vacancies arose has also been negatived. Thus, the decision of the Government to fill up these vacancies in accordance with the 2021 Rules cannot be faulted.”, the court observed.

The Court clarified that there is no vested right or legitimate expectation merely because the earlier Rules support the Respondent's case for promotion based on experience.

“This Court has observed that an employee does not have a vested right to be promoted nor does he possess a legitimate expectation to be promoted (See: Haryana SEB v. Gulshan Lal). The limited right that an employee can legitimately claim is for consideration of his candidature. However, should the government, being the appointing authority choose, in its wisdom, to not fill up vacancies by promotion, especially when there is a change in cadre and restructuring of posts, it cannot be compelled to carry out the appointments.”, the court observed.

Noting that the post of ARTO was a selection post and not of promotion, the Court said that “the manner of selection is a matter of policy which completely vests with the Government.”

“If the Government deemed it fit to change the method of selection, it was within its power, authority and competence and unless the changed policy is proved to be arbitrary, Dash and Sahoo cannot have a claim to the post.”, the court added.

Resultantly, the appeals were allowed.

Cause Title: STATE OF ODISHA & ORS. VERSUS SREEPATI RANJAN DASH (with connected case)

Citation : 2026 LiveLaw (SC) 514

Click here to download judgment

Appearance:

For Appellant(s) : Mr. Akshay Amritanshu, AOR Ms. Drishti Rawal, Adv. Mr. Abhay Nair, Adv. Mr. Sarthak Srivastava, Adv. Mr. Mayur Goyal, Adv.

For Respondent(s) :Mr. Dhananjai Jain, AOR Mr. Umakant Mishra, Adv. Mr. Debarata Dash, Adv. Mr. Apoorva Sharma, Adv. Mr. Shubhranshu Padhi, AOR Mr. Jay Nirupam, Adv. Mr. D.girish Kumar, Adv. Mr. Pranav Giri, Adv. Mr. Ekansh Sisodia, Adv. Mr. Ritik Sharma, Adv.