THE COURT ORDER ON CR:

THE HINDU

Legal Correspondent
Must not be used as fault-finding process
CR provides vital inputs for assessing performance Tribunal
overlooked good track record
New Delhi: In a significant judgment, the Supreme Court has held that
Government authorities should not use confidential reports (CRs) to
settle personal scores against employees.
Remarks such as "incompetent," "lacks objectivity," "arrogant" by a
competent authority against a subordinate should not be made out of
personal bias, said a Bench, comprising Justices A.R. Laskhmanan and
Altamas Kabir.
"The confidential report is an important document as it provides the
basic and vital inputs for assessing the performance of an officer and
further achievements in his career. Performance appraisal through
CRs should not be used as a tool for human resource development and
is not to be used as a fault-finding process but a developmental one.
DEV DUTT

In the case of Dev Dutt vs. Union of India and others3 , this Court had an
occasion to consider the question about the communication of the entry in the
ACR of a public servant (other than military service). A two Judge Bench on
elaborate and detailed consideration of the matter and also after taking into
consideration the decision of this Court in U.P. Jal Nigam1 and principles of
natural justice exposited by this Court from time to time particularly in A.K.
Praipak vs. Union of India4; Maneka Gandhi vs. Union of India5; Union of India
vs. Tulsi Ram Patel6; Canara Bank vs. V.K. Awasthy7 and State of Maharashtra
vs. Public Concern for Governance Trust8 concluded that every entry in the
ACR of a public service must be communicated to him within a reasonable
period whether it is poor, fair, average, good or very good entry.

This is what this Court in paragraphs 17 & 18 of the report in Dev Dutt3 at
page 733: "In our opinion, every entry in the A.C.R. of a public servant must be
communicated to him within a reasonable period, whether it is a poor, fair,
average, good or very good entry. This is because non-communication of such
an entry may adversely affect the employee in two ways :

(1) Had the entry been communicated to him he would know about the
assessment of his work and conduct by his superiors, which would enable him
to improve his work in future

(2) He would have an opportunity of making a representation against the

entry if he feels it is unjustified, and pray for its upgradation. Hence non-
communication of an entry is arbitrary, and it has been held by the
Constitution Bench decision of this Court in Maneka Gandhi vs. Union of India
(supra) that arbitrariness violates Article 14 of the Constitution.

Thus it is not only when there is a benchmark but in all cases that an entry
(whether it is poor, fair, average, good or very good) must be communicated
to a public servant, otherwise there is violation of the principle of fairness,
which is the soul of natural justice. Even an outstanding entry should be
communicated since that would boost the morale of the employee and make
him work harder."
4. Then in paragraph 22 at page 734 of the report, this Court made the
following weighty observations: "It may be mentioned that communication of
entries and giving opportunity to represent against them is particularly
important on higher posts which are in a pyramidical structure where often
the principle of elimination is followed in selection for promotion, and even a
single entry can destroy the career of an officer which has otherwise been
outstanding throughout. This often results in grave injustice and heart-
burning, and may shatter the morale of many good officers who are
superseded due to this arbitrariness, while officers of inferior merit may be
promoted."

5. In paragraphs 37 & 41 of the report, this Court then observed as follows:

"We further hold that when the entry is communicated to him the public
servant should have a right to make a representation against the entry to the
concerned authority, and the concerned authority must decide the
representation in a fair manner and within a reasonable period. We also hold
that the representation must be decided by an authority higher than the one
who gave the entry, otherwise the likelihood is that the representation will be
summarily rejected without adequate consideration as it would be an appeal
from Caesar to Caesar. All this would be conducive to fairness and
transparency in public administration, and would result in fairness to public
servants. The State must be a model employer, and must act fairly towards its
employees. Only then would good governance be possible. In our opinion,
non-communication of entries in the Annual Confidential Report of a public
servant, whether he is in civil, judicial, police or any other service (other than
the military), certainly has civil consequences because it may affect his
chances for promotion or get other benefits (as already discussed above).
Hence, such non-communication would be arbitrary, and as such violative of
Article 14 of the Constitution."

6. We are in complete agreement with the view in Dev Dutt3 particularly

paragraphs 17, 18, 22, 37 & 41 as quoted above. We approve the same.

In the present case the bench mark (i.e. the essential requirement) laid down
by the authorities for promotion to the post of Superintending Engineer was
that the candidate should have 'very good' entry for the last five years. Thus in
this situation the 'good' entry in fact is an adverse entry because it eliminates
the candidate from being considered for promotion. Thus, nomenclature is not
relevant, it is the effect which the entry is having which determines whether it
is an adverse entry or not. It is thus the rigours of the entry which is
important, not the phraseology. The grant of a `good' entry is of no satisfaction
to the incumbent if it in fact makes him ineligible for promotion or has an
adverse effect on his chances.

It has been held in Maneka Gandhi vs. Union of India & Anr. AIR 1978 SC 597
that arbitrariness violates Article 14 of the Constitution. In our opinion, the
non-communication of an entry in the A.C.R. of a public servant is arbitrary
because it deprives the concerned employee from making a representation
against it and praying for its up-gradation. In our opinion, every entry in the
Annual Confidential Report of every employee under the State, whether he is
in civil, judicial, police or other service (except the military) must be
communicated to him, so as to enable him to make a representation against it,
because non-communication deprives the employee of the opportunity of
making a representation against it which may affect his chances of being
promoted (or get some other benefits). Moreover, the object of writing the
confidential report and making entries in them is to give an opportunity to a
public servant to improve his performance, vide State of U.P. vs. Yamuna
Shankar Misra1997 (4) SCC
Indian Express Article

Dated: 13, May 2008

In a major boost to government staff, the Supreme Court ruled on Monday that
it was mandatory for authorities to disclose all contents of an annual
confidential report (ACR) to their employees, whether these marked their
performance as "poor, fair, average good or very good".

Developing a "new principle of natural justice", the Bench comprising Justices

H K Sema and Markandeya Katju said: "In our opinion, the non-
communication of an entry in the ACR of a public servant is arbitrary because
it deprives the concerned employee from making a representation against it
and praying for its upgradation."

The ACR, the court said, must be disclosed within a reasonable period of time.

Disagreeing with the arguments by the Union Government that it was under
an obligation only to disclose the "adverse remarks" against an employee, the
court said: "In our opinion, every entry in the Annual Confidential Report of
every employee under the State, whether he is in civil, judicial, police or other
service (except the military), must be communicated to him."

So far, as per an office memorandum issued by the Government in 1987, only

an adverse entry was communicated to the concerned employee.

According to the court, disclosure of all entries would "enable him (a public
servant) to make a representation against it, because non-communication
deprives the employee of the opportunity of making a representation against
it, which may affect his chances of being promoted (or getting some other
benefits)."
"Moreover, the object of writing the confidential report and making entries in
them is to give an opportunity to a public servant to improve his
performance," felt Justice Katju, who authored the judgment.

The court's order came on an appeal filed by an employee of the Border Roads
Engineering Service, Dev Dutt, who has since retired.

After being promoted as Executive Engineer, Dutt was considered for the next
promotion of Superintending Engineer. However, the Departmental
Promotion Committee (DPC) held that he was not eligible, and instead his
juniors were promoted to the rank.
RULES:

Before we part with this appeal, we may dispose of another contention of the
respondent about the delay in communicating to him the impugned adverse
remarks. Under Rule 5 of the Rules, a confidential report assessing the
performances, character, conduct and qualities of every member of the service
shall be written for each financial year, or calendar year, as may be specified
by the Govern- ment, ordinarily within two months of the close of the said
year. Rule 6 provides that the confidential report shall be reviewed by the
reviewing authority ordinarily within one month of its being written. Under
Rule 6A, the confidential report, after review, shall be accepted with such
modifica- tions as may be considered necessary, and countersigned by the
accepting authority, ordinarily within one month of its review. Thus, the
whole process from the writing of the confidential report to the acceptance
thereof has to be completed ordinarily within a maximum period of four
months. Further, under Rule 7 the adverse remarks, if any, in a confidential
report shall be communicated to the officer concerned within three months of
the receipt of the confidential report. Thus, a total period of seven months has
been laid down as the maximum period within which adverse remarks, if any,
has to be communicated to the officer concerned. It has been already noticed
that the adverse remarks were sent to the respondent after two years three
months, that is, after twenty seven months of the close of the year. It is
submitted by the respondent that in view of the delayed communication. the
adverse remarks lost all importance and should be struk down on that
ground.

DELAY IN COMMUNICATION

The whole object of the making and communication of adverse remarks is to

give to the officer concerned an opportunity to improve his performance,
conduct or charac- ter, as the case may. The adverse remarks should not be
understood in terms of punishment, but really it should be taken as an advice
to the officer concerned, so that he can act in accordance with the advice and
improve his service career. The whole object of the making of adverse
remarks would be lost if they are communicated to the officer concerned after
an inordinate delay. In the instant case, it was communicated to the
respondent after twenty seven months. It is true that the provisions of Rules
5, 6, 6A and 7 are directory and not mandatory, but that does not mean that
the directory provisions need not be complied with even substantially. Such
provisions may not be complied with strictly, and substantial compliance will
be sufficient. But, where compliance after an inordinate delay would be
against the spirit and object of the directory provision, such compliance would
not be substantial compliance. In the instant case, while the provisions of
Rules 5, 6, 6A and 7 require that everything including the communication of
the adverse remarks should be completed within a period of seven months,
this period cannot be stretched to twenty seven months, simply because these
Rules are directory, without serving any purpose consistent with the spirit
and objectives of these Rules. We need not, however, dilate upon the question
any more and consider whether on the ground of inordinate and
unreasonable delay, the adverse remarks against the respondent should be
struck down or not, and suffice it to say that we do not approve of the
inordinate delay made in communicating the adverse remarks to the
respondent. Now, coming to the case in hand, it is noticed that there is an
unexplained inordinate delay of about 7 years in communicating the
impugned adverse remarks. The representation dated 5.11.2007 was also
decided after sixteen months i.e. on 16.3.09 as against the time frame of three
months prescribed by the relevant Rule 10 of the Rules. There is no dispute
that the stipulated time frame for the entire exercise is only 7 months as
already observed in the case of State of Haryana Vs. P.C. Wadhwa (supra). As
against which, the details of the actual periods consumed by the respondents
in the present case have been mentioned in para 9 of this order/judgment. As
against this prescribed period of 7 months for the entire exercise, in the
present case, admittedly, the respondents consumed about more than 7 years.
The adverse remarks for the year 1998-99 were conveyed on 23.5.2007. In
the case of P.C. Wadhwa (supra), it has been categorically observed that
period of 7 months cannot be stretched to 27 months i.e. 2 years 3 months
simply because these Rules are directory, without serving any purpose
consistent with the spirit and objective of these Rules. In the present case, this
delay is about 3 times more. Therefore, in the light of the ratio decidendi and
the proposition of law laid down in the above case laws (supra) as also the
order/judgment of this Tribunal in the above O.A. 24/95 decided on 2.2.2001
(Sri Suvrat Tripathi Vs. UOI and others), we have no other alternative but to
direct for the expunging of the impugned annual remarks for the year 1998-
99 as communicated to the applicant on 23.5.2007.