Non-Supply Of ACRs, Destruction Of Service Records Caused Prejudice : Supreme Court Grants Enhanced Pension To Retired Railway Doctor

The Supreme Court has granted notional promotion and enhanced pensionary benefits to a retired Indian Railway Medical Service (IRMS) officer, holding that the non-supply of her Annual Confidential Reports (ACRs), destruction of her service records during pendency of litigation and irregular assessment of her performance had caused prejudice to her claim for promotion.

A Bench of Justice J.K. Maheshwari and Justice Atul S. Chandurkar allowed the appeal filed by Dr. Indira Saranath and set aside the decisions of the Central Administrative Tribunal and the Delhi High Court which had upheld the denial of her promotion to the post of Chief Medical Director in the Higher Administrative Grade (HAG).

The appellant had challenged the 2006 promotion exercise in which six officers were empanelled for promotion to the HAG post while she was found unsuitable despite being senior to some of the selected candidates.

Rejecting one of her contentions, the Court held that the Railway Board was entitled to prescribe its own benchmark of "Very Good Plus" (VG+) for promotions to HAG posts and was not bound by the Department of Personnel and Training's benchmark of "Very Good". The Bench observed that Railway service conditions are governed by rules framed by the Railway Board and the Ministry of Railways.

However, the Court found merit in her grievance that her ACRs had never been communicated to her despite repeated requests. Referring to the decisions in Dev Dutt v. Union of India and Sukhdev Singh v. Union of India, the Court reiterated that non-communication of entries in ACRs has civil consequences as it can adversely affect an employee's promotional prospects.

The Bench noted that even before her case was considered by the Selection Committee, the appellant had sought copies of her confidential reports, expressing apprehension that her performance had not been properly assessed. Despite pursuing the issue before the Tribunal and the High Court, the reports were never supplied to her.

The Court also took note of the Railways' admission that the appellant's service records had been inadvertently weeded out in 2013, even though judicial proceedings concerning her promotion claim were pending. The Bench observed that the authorities were required to preserve such records until conclusion of the litigation and held that an adverse inference deserved to be drawn against them.

Another irregularity highlighted by the Court concerned the award of 19.5 points to the appellant by the Selection Committee. The Bench found that the Railway Board's promotion policy did not provide for awarding fractional marks and that the authorities had failed to explain the basis for assigning 19.5 points. Since the appellant had received "Very Good" gradings for all five relevant years, she ought to have been awarded 20 points, the Court observed.

Summarising its conclusions, the Court said:

"The appellant has been prejudiced by the non-supply of her ACRs, destruction of her service records and award of points in fraction."

Holding that the appellant had not been treated fairly in the promotion process, the Court granted her notional promotion to the Higher Administrative Grade carrying the pay scale of ₹22,400-24,500 and directed refixation of her pension and other retiral benefits on that basis.

However, considering that the original service records were no longer available and that the Court was proceeding on the basis of an adverse inference against the authorities, it declined to grant salary arrears for the period between the notional promotion and her retirement.

The Court directed that the consequential pensionary arrears be paid to the appellant within two months.

Headnote

Service Law – Promotion – Indian Railway Medical Service – Evaluation Criteria & Allocation of Points - Challenge to non-promotion to the post of Chief Medical Director in Higher Administrative Grade (HAG) - The Railway Board's promotion policy dated 22.05.1996 prescribed a whole-number point system for Annual Confidential Report (ACR) gradings - The Selection Committee awarded the appellant a fractional score of 19.5 points despite her five-year ACR grading being uniformly 'Very Good' (which mandated 20 points) – Held that there is no provision in the promotion policy for awarding points in fractions - The assessment was made without an objective basis, and the appellant must be deemed to have secured 20 points based on her consistent 'Very Good' gradings. [Paras 16]

Service Law – Annual Confidential Reports (ACRs) – Non-communication of Entries: Obligation to communicate ACR entries, adverse or otherwise - The respondents contended that prior to the 2008-09 policy shift, only 'Average' or 'Below Average' gradings were communicable – Held that the nomenclature of an entry is immaterial; its determinative effect is what matters - Even a 'Good' or 'Very Good' entry becomes adverse in character if it makes an incumbent ineligible for promotion or prejudicially affects empanelment prospects - Non-communication of such entries carries civil consequences, depriving the employee of a fair opportunity to seek redressal or make representations. [Paras 12 – 17]

Service Law – Destruction of Records – Weeding Out During Pendency of Litigation – Adverse Inference - The respondents admitted that the appellant's original ACR service records were destroyed/weeded out in 2013, despite the active pendency of the present civil appeal before the Supreme Court filed in 2009 – Held that Service records are mandatorily required to be retained until the final conclusion of judicial proceedings - The destruction of the records during the pendency of the litigation severely prejudiced the appellant's case and precluded judicial scrutiny - a strong adverse inference is liable to be drawn against the employer respondents. [Paras 15-17]

Service Law – Retrospective Promotion – Retiral Benefits vs. Arrears of Salary - Appellant retired from service during the pendency of litigation – Held that where an employee is found to have been treated unfairly in the promotional evaluation, but the original service records are unavailable due to inadvertent weeding out, granting dynamic monetary relief like arrears of salary on a 'no work, no pay' relaxation may not be feasible - the ends of justice are met by directing the grant of notional promotion from the date her juniors were promoted, along with a mandatory re fixation of pension and payment of retiral arrears. [Relied on Prabhat Ranjan Singh v. R.K. Kushwaha, 2018 INSC 796; Dev Dutt v. Union of India, 2008 INSC 630; distinguished from Union of India v. Chaman Rana, 2018 INSC 230; Paras 18, 19]

Case :  Dr Indira Saranath v Union of India

Citation : 2026 LiveLaw (SC) 577

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For the Appellant(s): Senior Advocate Mr. Jaideep Gupta; Ms. Radha Rangaswamy, Advocate; Mr. Prateek K. Chadha, AOR; Ms. Racheeta Chawla, Advocate; Mr. Sreekar Aechuri, Advocate; Ms. Pragya Ganjoo, Advocate; Ms. Surbhi Soni, Advocate; Mr. Aniket Chauhaan, Advocate.

For the Respondent(s): Mr. Vikramjit Banerjee, Additional Solicitor General; Ms. Rekha Pandey, Advocate; Mr. Suyash Pande, Advocate; Mrs. Priya Mishra, Advocate; Mr. Padmesh Mishra, Advocate; Mr. Amrish Kumar, AOR.