Deputation No Bar to Equivalent Designation on Experience: J&K High Court Rules in Favor of Fair Placement for Borrowed Employees

Introduction

In a significant ruling for service law, the High Court of Jammu & Kashmir and Ladakh has held that employees on deputation cannot be denied equivalent designations in the borrowing organization based solely on their deputation status. The court emphasized that experience gained in the parent department must be counted for determining appropriate placement, and denying such benefits amounts to unfair and discriminatory treatment. This decision came in the writ petition filed by Rishi Kumar, a deputationist from the J&K State Power Development Corporation (JKSPDC) working at Chenab Valley Power Projects Ltd. (CVPPL), a joint venture between NHPC and JKSPDC. A single bench comprising Justice Javed Iqbal Wani quashed rejection orders against Kumar's claims and directed his re-designation as Manager with retrospective benefits. The ruling, pronounced on December 22, 2025, underscores the principles of equity in service conditions for deputationists, potentially setting a precedent for similar cases in joint ventures and government enterprises.

The case highlights ongoing tensions in managing human resources in collaborative public sector projects, where deputationists often face disparities in grading and promotions compared to regular employees. By rejecting the borrowing organization's stance that deputation bars higher placement, the court reinforced the protections under the Promoters' Agreement governing CVPPL and broader service regulations.

Case Background

Rishi Kumar, aged 53 and a resident of Jammu, has been a permanent employee of the JKSPDC (Respondent No. 7) since holding the position of Incharge Assistant Executive Engineer (Degree Holder) from July 30, 2012. By October 2016, Kumar had accumulated four years of experience in this role when he was transferred on deputation to CVPPL, a joint venture established under a Promoters' Agreement dated December 21, 2010, between the Government of India (through NHPC), the Government of Jammu & Kashmir (through JKSPDC), and Power Trading Corporation Ltd. CVPPL, headquartered in Jammu, focuses on power projects in the Chenab Valley and relies heavily on deputed personnel from parent organizations to fulfill its operational needs.

Upon joining CVPPL in 2016, Kumar was placed as Assistant Manager (Electrical) in Grade E-3, with a pay scale of ₹27,100–₹54,050, in line with the equivalence criteria outlined in the Promoters' Agreement. This placement aligned with CVPPL's rules, which entitle an Assistant Executive Engineer with four years of experience to Grade E-3, escalating to Grade E-4 after eight years. Kumar opted for CVPPL's pay scales and allowances, forgoing certain benefits from his parent department, such as compensatory and charge allowances, in exchange for dearness allowance and other perks.

The dispute arose following a revision of grades and designations in CVPPL via Office Order dated January 3, 2019. This one-time exercise redesignated Grade E-3 (Assistant Manager) to Grade E-4 (Deputy Manager) with a pay scale of ₹70,000–₹2,00,000, and Grade E-4 (Deputy Manager) to Grade E-5 (Manager) at ₹80,000–₹2,20,000. Consequently, Kumar was redesignated as Deputy Manager effective from January 3, 2019, without a change in pay or allowances.

By July 30, 2020, Kumar had completed eight years as an Assistant Executive Engineer (Degree Holder), including his prior service in JKSPDC. He claimed entitlement to re-designation as Manager (Grade E-5) under Clause 4 of the Promoters' Agreement and the 2019 Order. However, CVPPL rejected his representations dated August 25, 2020, September 4, 2020, and subsequent ones in 2023, citing his deputation status. Key rejection communications included Office Memorandum dated October 12, 2020 (No. CVPPL/CO/HR/2020-21/3822), and Communication dated August 14, 2023 (No. CVPPL/HR/2022-23/1124), which stated that promotions and higher grades were governed by JKSPDC's rules, not CVPPL's, and that deputationists could not seek elevations during their tenure.

A supplementary Promoters' Agreement dated November 21, 2022, further protected deputationists' service conditions, ensuring they were "in no way inferior" to those in their parent organizations and adopting NHPC's designations. Despite this, CVPPL persisted in denials, even after JKSPDC's recommendation letter dated September 26, 2024, urging Kumar's placement as Manager— a benefit already extended to a similarly placed officer, K.K. Khanna. The final rejection came via Communication dated November 5, 2024.

Aggrieved, Kumar filed Writ Petition (Civil) No. 2269/2025 under Article 226 of the Constitution on grounds of arbitrariness, discrimination, and violation of the agreements. The petition sought quashing of the rejection orders and a mandamus for re-designation as Manager from July 30, 2020, with monetary benefits, and further consideration for Senior Manager (Grade E-6) from July 30, 2023.

The case timeline spans from Kumar's deputation in 2016, through multiple representations and rejections between 2020 and 2024, to the High Court's reservation on November 25, 2025, and pronouncement on December 22, 2025.

Arguments Presented

Petitioner's Contentions

Represented by Senior Advocate Sunil Sethi with Advocate Surbhi Gupta, Kumar argued that his total experience of eight years as Assistant Executive Engineer entitled him to Grade E-5 (Manager) under the explicit provisions of the Promoters' Agreement and the January 3, 2019, Order. Clause 9.13 of the original and supplementary agreements mandated equivalence based on service rules from NHPC and JKSPDC, without excluding parent department experience. He emphasized that Clause 4 of the 2010 Agreement provided for Assistant Executive Engineers with eight years' service to be placed as Managers in CVPPL.

Kumar highlighted discriminatory treatment: While he was denied re-designation, K.K. Khanna, another deputationist with similar qualifications, was elevated to Manager per JKSPDC's September 26, 2024, recommendation. He contended that CVPPL's rejections were arbitrary, as they overlooked the 2019 redesignation's intent to align grades with experience, not deputation status. Placement in an equivalent grade, he argued, was not a "promotion" but "proper placement" commensurate with expertise, protected under Article 14 (equality) and Article 16 (equal opportunity in public employment) of the Constitution.

Further, Kumar noted that the supplementary 2022 Agreement reinforced protections for deputationists up to five years (extendable), ensuring continuity and non-inferior conditions. Denying re-designation stalled his career progression, preventing eligibility for Senior Manager after three more years, and violated natural justice by ignoring JKSPDC's endorsements. He sought retrospective benefits, including arrears and interest, arguing that CVPPL's reliance on J&K Civil Services Regulations (1956) was misplaced, as those governed repatriation, not intra-deputation placements.

Respondents' Contentions

CVPPL (Respondents 1-6), represented by Senior Advocate Deepika Mahajan with Advocate Atharv Mahajan, opposed the petition, asserting that deputation is temporary and Kumar remained under JKSPDC's cadre. They admitted his initial placement as Assistant Manager in 2017 per equivalence criteria but argued that the 2019 redesignation was a one-time exercise without altering pay or powers for deputationists. Higher grades during deputation would disrupt CVPPL's cadre hierarchy and internal equity, as deputed employees from varied J&K departments have disparate service conditions.

The respondents claimed no provision in CVPPL rules or the Promoters' Agreement allowed "promotion-like" elevations for deputationists; any benefits must align with parent department rules. They rejected counting pre-deputation experience for CVPPL-specific upgrades, stating Kumar's eight-year claim was "not in consonance" with the Agreement. Post-five-year deputation, repatriation was mandatory, and his extended stay did not confer regular employee status. The 2022 supplementary Agreement, they argued, maintained equivalence only for initial posting, not ongoing advancements. Finally, they dismissed discrimination claims, noting Khanna's case was distinct and that granting Kumar's relief would set an unhealthy precedent for over 100 deputationists in CVPPL.

JKSPDC (Respondent 7), through Senior Additional Advocate General Raman Sharma with Advocate Saliqa Sheikh, supported Kumar's claims indirectly via their 2024 recommendation but deferred to the court's interpretation of inter-organizational agreements.

Legal Analysis

Justice Wani's judgment meticulously dissected the Promoters' Agreements and the 2019 Order, finding no bar to counting parent department experience for equivalent designations. The court referenced Clause 9.13 of the 2010 Agreement, which requires deputationists' conditions to be "in no way inferior" to parent organizations and adopts NHPC designations with equivalence per Annex-A. The 2022 supplementary clause reinforced this by establishing a committee from NHPC and JKSPDC to resolve disparities in status and salary, explicitly basing equivalence on both promoters' service rules.

The court clarified a key distinction: Placement in an appropriate grade based on total experience is not "promotion," which implies internal cadre advancement, but "proper placement" ensuring equity. It rejected CVPPL's interpretation that deputation limits benefits to initial equivalence, noting neither agreement nor the 2019 Order excluded pre-deputation service. The 2019 redesignation explicitly mapped eight-year Assistant Executive Engineers to Manager (Grade E-5), applicable to deputationists like Kumar and Khanna.

On discrimination, the bench invoked Article 14, holding differential treatment of similarly situated officers impermissible. CVPPL's reliance on J&K Civil Services Regulations was deemed erroneous, as those regulate parent cadre promotions, not borrowing organization placements reinforced by contractual agreements. The court drew parallels to service law precedents emphasizing non-discriminatory treatment for borrowed employees, though no specific cases were cited; the reasoning aligned with broader principles under Articles 14 and 16 prohibiting arbitrary state action in employment.

The analysis emphasized CVPPL's unique structure as a joint venture, where deputationists form the backbone, necessitating fair integration to avoid morale issues and operational inefficiencies. By quashing the rejections as "misconceived, palpably erroneous, unfair, unreasonable, and discriminatory," the court prioritized contractual intent over rigid deputation formalities.

Key Observations

The judgment is replete with incisive observations underscoring equity in service matters. Key excerpts include:

• On the nature of placement: "Neither the Promoter’s Agreement (supra) nor order dated 03.01.2019 provides that experience acquired by a deputationist in his parent department shall not be counted as experience for the purpose of determining equivalent designation in CVPPL and otherwise also the placement of such an officer in the appropriate grade and designation, based on experience in CVPPL, cannot be construed as an act of promotion, rather, would amount to proper placement of such officer in the relevant grade and position commensurate with his/her experience."

• On the respondents' stance: "Besides, the ground of rejection urged by respondent 1 qua the claim of petitioner that he is on deputation and that any benefit relating to his placement in a particular grade with designation in CVPPL is unavailable to him and can be claimed only under the relevant service rules and Civil Service Regulations applicable to him in his parent department, seemingly is misconceived and palpably erroneous."

• On discrimination: "Thus, the ground of rejection of petitioner’s claim by respondent 1 appears to be unfair, unreasonable, inasmuch as discriminatory, which cannot be countenance in law."

• Regarding similarly placed officers: "In view of re-designation of similarly placed officer/Degree Holder Assistant Executive Engineer, namely, K.K. Khanna, as Manager by respondent 1... the rejection of petitioner's claim in disregard to the same as well as the Promoter's Agreement (supra) as well as order dated 03.01.2019, is misconceived."

These observations, drawn verbatim from paragraphs 17-18 of the judgment, encapsulate the court's rationale, emphasizing contractual fidelity and constitutional protections.

Court's Decision

The High Court allowed the writ petition, issuing a writ of certiorari to quash Communication No. CVPPL/HR/2022-23/1124 dated August 14, 2023; Office Memorandum No. CVPPL/CO/HR/2020-21/3822 dated October 12, 2020; and Communication dated November 5, 2024. Via a writ of mandamus, it directed CVPPL to re-designate Kumar as Manager (Grade E-5) effective July 30, 2020, granting all consequential benefits, including monetary arrears. Additionally, the court ordered consideration for Senior Manager (Grade E-6) from July 30, 2023, if Kumar meets experience criteria, to be completed within six weeks of the order's production.

The implications are profound for deputationists in public sector joint ventures. This ruling mandates inclusive equivalence criteria, preventing borrowing organizations from insulating hierarchies against experienced borrowed talent. It could streamline HR practices in entities like CVPPL, reducing litigation over placements and fostering equity across NHPC, JKSPDC, and similar setups. For legal professionals, it reinforces that deputation agreements must be interpreted holistically, prioritizing non-discrimination over technicalities. Future cases may invoke this precedent to challenge rigid service silos, potentially influencing policy in power and infrastructure sectors where deputations are commonplace. Overall, the decision promotes a more integrated, experience-valuing approach to public employment, benefiting over 100 deputationists at CVPPL and beyond.