IMPORTANT POINT
It is a well settled principle of service jurisprudence that the employer is entitled to lay down policy decision laying down the criteria for grant of promotion to its officers.

JUDGMENT

S.B. Sinha, J.-This appeal is directed against the judgment and order dated 31.3.1998 passed by a Division Bench of the Andhra Pradesh High Court in Writ Appeal No. 1152 of 1988 whereby and whereunder an appeal preferred by the appellant herein against a judgment and order dated 13.6.1988 passed by a learned Single Judge in Writ Petition No. 6076 of 1984 was dismissed.

2. In view of the point involved in this appeal, it may not be necessary to dwell at length the fact of the matter. Suffice it to point out that Respondent Nos. 3 to 12 herein at all relevant times were holding the posts of Regional Manager. They along with the Respondent Nos. 1 and 2 herein were considered for promotion to the post of Assistant General Manager upon following the procedures laid down in a circular letter dated 11.2.1984 issued in terms of Regulation 17(1) of the Andhra Bank (Officers ) Service Regulations, 1982, (hereinafter referred to as the Regulations , for the sake of brevity). Upon consideration of the cases of the private parties herein, the respondent Nos. 3 to 13 were promoted; whereafter the writ petition was filed by the respondent Nos. 1 and 2 herein questioning the validity of the said circular. A learned Single Judge of the High Court in the said writ petition held that Regulation 17(1) of the Regulation is arbitrary as no guideline was provided thereby. Aggrieved by and dissatisfied with the said judgment, the appellant herein preferred an appeal before the Division Bench of the High Court. The Division Bench despite holding that Regulation 17 of the Regulations may not be ultra vires the Constitution of India but the promotion policy formulated by the appellant should have been issued in compliance of the procedure laid down in Section 19 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (hereinafter referred to as the Act , for the sake of brevity) holding :

"... It is a settled principle of law when power is delegated to a subordinate law making body subject to certain conditions, the conditions must be complied with. Otherwise the subordinate legislation would be ultra vires, the power granted to it, which itself is subject to a condition."

3. Mr. V.R. Reddy, learned Senior Counsel appearing on behalf of the appellant would submit that the Division Bench of the High Court went wrong in holding that in making the guidelines, the conditions precedent for making the regulation as contained in Section 19 of the Act were required to be complied with. The learned counsel would submit that it is not in dispute that the Board of Directors of the appellant-Bank before framing the regulations had consulted the Reserve Bank of India and also obtained prior approval of the Central Government in terms of Section 19 of the Act. The policy decision as regard promotion of the officers having been framed in terms of Regulation 17 and in conformity with the guidelines issued by the Union of India, Mr. Reddy would submit, it was not necessary to consult the Reserve Bank of India or obtain prior permission of the Central Government.

4. It is not in dispute that the appellant-Bank was a corresponding new bank within the meaning of the provisions of the Act. Section 8 of the Act obligates every corresponding new bank to be guided by such directions as regard the matters of policy involving public interest as the Central Government may, after consultation with the Governor of the Reserve Bank, give.

5. Sub-section (2) of Section 12 of the Act reads as under :

"(2) Save as otherwise provided in sub-section (1), every officer or other employee of an existing bank shall become, on the commencement of this Act, an officer or other employee, as the case may be, of the corresponding new bank and shall hold his office or service in that bank on the same terms and conditions and with the same rights to pension, gratuity and other matters as would have been admissible to him if the undertaking of the existing bank had not be