The core dispute revolves around seniority lists and promotion criteria within the Kerala Water Authority. Specifically, the case examines whether employees initially promoted under a “diploma quota” can later switch to a “degree quota” for further promotion, and the applicability of two distinct sets of service rules: the Kerala Public Health Engineering Subordinate Service Rules, 1966, and the Kerala Public Health Engineering Service Special Rules, 1960, to different stages of employment. The Supreme Court ultimately overturns lower court decisions, asserting that the 1960 Special Rules, which allow for such an option, apply to Assistant Engineers regardless of their initial entry method, to avoid absurd outcomes.
Kerala Public Health Engineering Service Special Rules, 1960, Rule 4(b) – Kerala Public Health Engineering Subordinate Service Rules, 1966 – Service Law – Seniority – Quota rule – Direct recruits viz-a-viz promotes diploma holders and degree holder – Appellants all had obtained an engineering degree much prior to their promotion as an Assistant Engineer – However, the Appellants had also applied for direct recruitment in the 6% (six per cent) in-service quota and despite being included in its Select List, the Appellants had declined their appointments as they had already been appointed in the 40% (forty per cent) promotional category before the declaration of results of the recruitment exam in the 6% (six per cent) quota.
Consequently, the Appellants, at the stage of entering the Kerala Public Health Engineering Service, never had the opportunity to opt or choose for the diploma or degree quota – However, the two private Respondents were appointed to the post of Assistant Engineers as they were successful in the direct recruitment exam in the degree quota – Special Rules, 1960 deal with a separate service, its Rule 4(b) has no applicability to a stage prior to an officer becoming an Assistant Engineer i.e. to the draftsman/overseer who are holding both degree and diploma qualification and who exercise the option of sitting in 6% (six per cent) competitive exam for promotion to the post of Assistant Engineer.
Learned Single Judge has erroneously held that “directly recruited Assistant Engineers from the open market and those promoted through the Departmental Quota are considered under separate watertight categories.
Held that once a person joins as an Assistant Engineer, i.e. the feeder post under a separate service governed by Special Rules, 1960, then that person irrespective of how he/she has been appointed to that post, has the option to migrate to either the degree or diploma quota, provided he/she has obtained a degree or a diploma – Proviso to Rule 4(b) is not just a proviso to the paragraph preceding it but to the entire Rule 4(b) . The first para of Rule 4(b) when it stipulates that vacancy in the category of Assistant Engineers (to be read as Assistant Executive Engineer) shall be filled up from among those in Categories 1 and 2 in the Subordinate Service Rules, 1966 in the ratio of 4:1, takes within its fold all the officers serving as Assistant Engineer – Consequently, the proviso which gives the option to such officers to choose the diploma or degree quota means and refers to all the officers holding the post of Assistant Engineer – The paragraph preceding the proviso clarifies that the option to choose the stream shall be available to even those Assistant Engineers who acquire the degree during their tenure as Assistant Engineers -The proviso further clarifies as to how seniority of such Assistant Engineers would be determined. Impugned judgments passed by the learned Single Judge and the Division Bench are liable to be set aside.
(Para 16 to 32)
Sajithabai V. Kerala Water Authority
Supreme Court: 2025 INSC 354: (DoJ 18-03-2025)




