IN THE SUPREME COURT OF PAKISTAN

(Appellate Jurisdiction)

Present

Mr. Justice Amin-ud-Din Khan

Mr. Justice Muhammad Ali Mazhar
Mr. Justice Syed Hasan Azhar Rizvi

Civil Petition No. 687 of 2022

On appeal from the Judgment dated
05.01.2022 passed by the Federal Service
Tribunal, Islamabad in Appeal No.
814(R)CS/2019.

Federation of Pakistan through Secretary ..…Petitioner

Finance, Islamabad.

Versus

Muhammad Atiq-ur-Rehman and others …Respondent(s)

For the Petitioner(s) : Ch. Aamir Rehman, Additional

Attorney General
Aitzaz Alam, S.O.M/o Finance
Fraz Ahmad, S.O. M/o Finance
Syed B.H.Shah, AOR

Mr. M.D.Shahzad, ASC

(for FBR)

For the Respondent : Ms. Shireen Imran, ASC

No.1

Date of Hearing : 05.12.2024

Judgment

Muhammad Ali Mazhar-J: This Civil Petition for leave to appeal is

directed against the Judgment dated 05.01.2022 passed by the
learned Federal Service Tribunal, Islamabad (FST) in Appeal No.
814(R)CS/2019.

2. According to the chronicles of the lis, the respondent No. 1 was

appointed as Assistant (Admin) SPS-5 in Pakistan Atomic Energy
Commission (PAEC), Islamabad. During service, he applied through
proper channel for the vacancy of Assistant Director (Admin) BS-17
in the Department of Libraries, Ministry of Education (Defunct),
Islamabad. He was appointed on the recommendation of Federal
Public Service Commission (FPSC) vide the Office Order dated
24.05.2010. Being aggrieved by disallowing the benefit of pay-
protection in its latter department/employer, he approached FST,
CP.687/2022 -2-

Islamabad and filed the Appeal No. 814(R)CS/2019 for redress. The
learned Tribunal vide impugned judgment, directed the petitioner to
take all the necessary measures for granting the benefit of pay-
protection to the respondent No.1/appellant according to Last Pay
Certificate (LPC) issued by Pakistan Atomic Energy Commission.

3. The learned Additional Attorney General (AAG) argued that the

learned FST failed to consider Finance Division's O.M. No.4(2)R-2/96
dated 12.08.2002, whereby, the benefit of pay-protection to the
employees of autonomous bodies established by means of
Ordinance, Statute, Acts or Executive Order is not admissible on
their subsequent appointment in the Government service. He further
contended that such employees cannot be treated as Civil Servants
within the meanings of the Civil Servants Act, 1973 in relation to
their past service. It was further averred that the PAEC was
established under Pakistan Atomic Energy Commission Ordinance
1965 and regulated under the National Command Authority Act,
2010. The PAEC has its own Special Pay Scales (SPS) and the Basic
Pay Scales (BPS) were never adopted which is the primary
requirement for the pay-protection under the aforesaid policy
guidelines issued by the Finance Division.

4. The learned counsel for the respondent No.1 argued that initially
the respondent No.1 was appointed as Assistant (Admin) SPS-5 on
regular basis in PAEC, Islamabad against the post of Assistant
Director (Admin), BS-17 advertised by the FPSC for appointment of
Department of Libraries, in the Ministry of Education, (Defunct)
Islamabad. The respondent No.1 applied for that post through
proper channel and he was appointed vide Office Order dated
24.05.2010. It was further argued that before joining new
assignment, the respondent No.1 was drawing Basic Pay of
Rs.13,550/- in previous department whereas on joining new post,
his basic pay was fixed at initial stage of Rs.9,850/ which caused
him loss of Rs.3,700/- per month. He filed Departmental Appeal for
his pay-protection which was not responded, thereafter, he filed
Service Appeal No. 814(R)CS/2019, which was allowed by the FST,
vide impugned judgment. It was further averred that the competent
authority granted the pay protection benefit to some other employees
but the respondent No.1 was discriminated. It was further
contended that though the benefit of the pay-protection to the
employees of autonomous body on their subsequent appointment in
CP.687/2022 -3-

government service is not admissible as the employees of

autonomous bodies are not civil servants within the meaning of Civil
Servant Act, 1973 but the benefit of pay protection will be admissible
to the employees of such autonomous organizations who have
adopted scheme of BPS on their appointment in government offices
provided they have applied for the post through proper channel.

5. Heard the arguments. What we have perceived is that the learned

FST mainly relied on its own judgment dated 19.07.2017, rendered
in Appeal No.1730(R)CS/2015, whereby the pay-protection was
allowed in the case of Muhammad Banaras. The said judgment was
challenged by the Secretary Finance Division, Islamabad in this
Court but their Civil Petition No. 4275 of 2017 was dismissed by this
Court vide Order dated 10.10.2018. For the ease of convenience, the
order passed by this Court is reproduced as under:-

“The learned FST has, by the impugned judgment dated

19.7.2017, and determined the respondent to be entitled to pay
fixation upon his transfer and absorption from PAEC to the
office of Auditor General of Pakistan. The Tribunal has relied on
an office memorandum dated 31.5.2013 of the Ministry of
Finance Regulation Wing to conclude that the pay fixation is
necessarily available to a permanent employee because it is also
being offered to contractual employees on their regularization.
Learned Additional Attorney General has drawn our attention to
an office memorandum which is not available on record nor is
pleaded by the petitioner-authorities that acknowledges the
right of the respondent to receive pay fixation but only if he has
adopted the scheme of basic pay scale in toto. There is nothing
on record to show that the petitioner has not adopted the said
scheme or even that objection has been taken at any stage by
the petitioner on that behalf. Accordingly, we have no reason to
differ with the view taken by the Tribunal in respect of a paltry
sum of Rs.48,000/- per annum to a BS-1 employee of AGP
office. The petition is dismissed and leave to appeal declined.
The learned Additional Attorney General shall convey our
displeasure to the petitioner for taking up such a pointless
litigation before the Supreme Court”. [Emphasis applied]

6. The crux of the controversy highlighted in the aforesaid order

demonstrates that the FST relied on an OM dated 31.05.2013 issued
by the Ministry of Finance Regulation Wing in which it was decided
that the pay fixation is necessarily available to a permanent employee
because it is also being offered to contractual employees on their
regularization. The learned Additional Attorney General in that case
though relied on an OM but it was not available on record nor was it
pleaded that the authorities acknowledged the right of the
respondent to receive pay fixation, but only if he has adopted the
CP.687/2022 -4-

scheme of basic pay scale in toto. Since there was nothing on record
to show that the petitioner has not adopted the said scheme, the
petition was dismissed and leave to appeal was declined on the
technical ground without touching the merits of the case or claim.

7. The Fundamental Rules and Supplementary Rules (FR&SR) define

and determine the financial terms and conditions of government
employees such as pay, allowances, leave and travelling allowances
etc. Since in this case, Fundamental Rule (F.R) 22 is quite relevant,
therefore for the ease of reference, it is reproduced as under: -

“F.R.22. The initial substantive pay of a Government servant who

is appointed substantively to a post on a time-scale of pay is
regulated as follows:-

(a) If he holds a lien on a permanent post, other than a tenure post,

or would hold a lien on such a post had his lien not been suspended;

(i) When appointment to the new post involves the assumption of

duties or responsibilities of greater importance (as interpreted for the
purposes of rule 30) than those attaching to such permanent post, he
will draw as initial pay the stage of the time-scale next above his
substantive pay in respect of the old post;

(ii) when appointment to the new post does not involve such
assumption, he will draw as initial pay the stage of the time-scale
which is equal to his substantive pay in respect of the old post, or, if
there is no such stage the stage next below that pay plus personal pay
equal to the difference, and in either case will continue to draw that
pay until such time as he would have received an increment in the
time-scale of the old post or for the period after which an Increment
is earned in the time-scale of the new post, whichever is less. But if
the minimum pay of the time- scale of the new post is higher than his
substantive pay in respect of the old post, he will draw that minimum
as initial pay; [Emphasis applied]

(iii) when appointment to the new post is made on his own request
under rule 15(a) and the maximum pay in the timescale of that post
is less than his substantive pay in respect of the old post, he will draw
that maximum as initial pay.

Exception.—Telegraph Masters and Telegraphists of the Pakistan

Posts and Telegraphs Department who are at their own request
transferred from "General Service" to "Station Service" and whose
substantive pay in the General Service Scale is higher than the
maximum pay of the time scale of the Station Service sanctioned for
the Station to which they are transferred will, in addition to the
maximum pay in the time-scale of such Station Service, draw
personal pay equal to the difference between the two.

(b) If the conditions prescribed in clause (a) are not fulfilled he will
draw as initial pay the minimum of the time-scale. Provided, both in
cases covered by clause (a) and in cases, other than cases of re-
employment after resignation from the public service 29(or after
removal from the public service for inefficiency, misconduct or as a
disciplinary measure, ) covered by clause (b), that if he either—

(1) has previously held substantively or officiated in—

CP.687/2022 -5-

(i) the same post, or

(ii) a permanent or temporary post on the same time-scale, or

(iii) a permanent post other than a tenure post, on an identical time -

scale, or a temporary post on an identical time-scale, such post being
on the same time-scale as a permanent post, or

(2) is appointed substantively to a tenure post on a time-scale

identical with that of another tenure post which he has previously
held substantively or in which he has previously officiated, then the
initial pay shall not be less than the pay, other than special pay,
personal pay or emoluments classed as pay by the President under
rule 9(21) (a) (iii), which he drew on the last such occasion, and he
shall count for increments the period during which he drew that pay
on such last and any previous occasions. If, however, the pay last
drawn by the Government servant in a temporary post has been
inflated by the grant of premature increments the pay which he would
have drawn but for the grant of those increments shall, unless
otherwise ordered by the authority competent to create the new post,
be taken for the purposes of this proviso to be the pay which he last
drew in the temporary post.

Exception.—The condition in paragraph (iii) of the first proviso that

the temporary post should be on the same time-scale as a permanent
post shall not be enforced when a temporary post is (i) created by one
Government or Department for the purpose of work of the same
nature as the ordinary work for which permanent posts exist in a
cadre under a different Government or Department and (ii) sanctioned
on a time-scale identical with the time-scale applicable to the
permanent posts in the cadre under the different Government or
Department”.

Ref: https://www.finance.gov.pk/publications/compilation_of_fundamental_rules_2018_vol_I.pdf

8. We have also adverted to the relevant Notifications/Office

Memorandum for our clarity and to examine the legitimacy of claim
lodged by the respondent No.1 for the benefit of pay-protection on
his fresh appointment with a new assignment. The gist of certain
relevant OM(s) are as under: -

i) The O.M No. 4 (2) R-2/1996-235/2010, dated 08.06.2010, issued by

Finance Division (Regulations Wing), Government of Pakistan with the
subject, “Fixation/Protection of Pay on Appointment from One Post to
Another”, refers to Finance Division's O.M. No. 4 (2) R-2/96 dated 12th
August, 2002, which accentuated in paragraph 02 that "The benefit of
protection of pay to the employees of autonomous bodies on their
subsequent appointment in government service is not admissible as the
employees of autonomous bodies are not civil servant within the meaning
of Civil Servant Act, 1973. However, the benefit of pay protection will be
admissible to employees of such autonomous organizations who have
adopted Scheme of Basic Pay Scales in toto on their appointment in
Government offices provided they have applied for the post through proper
channel." In view of the aforesaid position, para-2 of the Finance Division's
O.M. No. F.4(1)R-2/96 dated 12.08.2002 was substituted accordingly.

ii) The OM No. 7(9)R-1/2012, dated 31.05 2013, issued by Finance

Division, (Regulations Wing), Government of Pakistan, with regard to the
“Protection of Pay of Contract Employees on Regularization/Appointment
on Regular Basis”. By means of this O.M, the pay-protection was allowed
CP.687/2022 -6-

to the contract employees on their regularization/appointment on the

conditions “i) That the contract appointment has been made on standard
terms and conditions circulated by Establishment Division as amended for
time to time; ii) That the contract employee has applied through proper
channel and has been properly relieved by the appointing authority. This
condition shall not apply in case of regularization on the same post; iii)
That regularization/regular appointment has been made with the approval
of competent authority; iv) That there is no break or interruption between
contract service and regular service; v) That the service rendered on
contract basis shall not qualify for pension/gratuity; vi) That in case of
regular appointment in lower grade pay shall not be protected” In
paragraph 02 of this OM, the Ministries/Divisions/Departments were
authorized to protect/fix pay in terms of above guidelines with the rider
that only those cases may be referred to Finance Division where some
clarification or advice of Finance Division is required.

iii) The OM. F.No. 7(9) R-1/2012-1388, dated 06.03.2014, issued by

Finance Division, (Regulations Wing), Government of Pakistan, germane to
the “Clarification Regarding Protection of Pay of Contract Employees on
Regularization/Appointment on Regular Basis”. In fact, this OM reflects
that certain queries raised for clarification by AGPR, Islamabad and certain
Ministries/Divisions/Departments which were answered in the following
terms:

S.No. Queries raised Clarification

i. Finance Division's O.M. dated The said OM. will take effect
31st May, 2013 does not contain from the date of its issue le 31-
effective date of implementation. 05-2013.
Fro m which date will it take
effect.

ii. Whether the pay of employees The pay of only those contract
working on dally wages, short- employees (Non-gazetted),
term vacancies and on contract whose appointments have been
basis, regularized by the made on standard terms and
Cabinet Sub-Committee is conditions in BPS by the
protectable. competent authority, is
protectable.

iii. Whether employees whose Pay is protectable of those

services were transferred from employees only whose contract
development to non- appointment in development
development side are entitled to side was made in BPS-1 to 15 on
pay protection. standard terms and conditions.

iv. Whether the pay of contract Finance Division's OM. clearly

employees on their states that in case of regular
regularization in lower grade is appointment in lower grade pay
protectable or otherwise. shall not be protected.

v. Whether the contract employees Yes.

of BPS-1 to 4 who were moved
one scale up w.e.f. 01-07-2007
are entitled to protection of pay
on regularization.

vi. In case the pay protection is As stated against (i) above.

allowed w.e.f 31-05-2013 to all
back date cases, please clarify
about the date of pay fixation
regarding date of regularization
or implementation of this policy
and whether payment of arrear
after 31-05-2013 payable or not.

vii. Whether an employee working As stated against (iii) above.

in a Development Project on his
appointment on regular basis in
CP.687/2022 -7-

the Ministry, Division and

Department is protectable.

viii. Whether the pay of an employee Yes, subject to conditions, as

working on contract basis in the stated against (ii) above.
Provincial Government who
later on joins a regular post in a
Federal Government is also
protectable.

(iv) The letter dated No.9(2)R-1/2016-493/2018, communicated by (Zia-ur-

Rehman), Section Officer (R-1), Finance Division, Regulations Wing,
Government of Pakistan dated 22.11.2018 to Director (Legal), Auditor
General of Pakistan, Islamabad on the subject of Misc. Petition No.3283/17
in Appeal No.1730 (R) CS-2015 filed by Mr. Muhammad Banaras Vs.
Finance Division etc. was also focused on fixation of gay on regular
appointment of employees of autonomous bodies against civil posts under
government which is to be regulated by the government policy contained in
Finance Division's O.M.No.4(2)R-2/96 dated 12.08.2002 and
0.M.No.4(2)R-2/1996-235/2010 dated 08-06-2010. The letter further
emphasised that policy affords protection of pay of the employees of those
autonomous bodies who have adopted government basic pay scale scheme
in totality. The employees of Atomic Energy Commission of Pakistan since
have Special Pay Scales, therefore, they are not entitled for protection of
pay rendered in the Commission in terms of policy guidelines issued vide
Finance Division's O.M.No.4(2)R-2/96 dated 12-08-2002. The same letter
further put emphasis on due deference to the Federal Service Tribunal's
Judgment dated 19-07-2017 and order of this Court passed in Civil Petition
No. 4275/2017, whereby the Finance Division conveyed its NOC for
protection of pay to Mr. Muhammad Banaras, Naib Qasid (BS-01) Auditor
General of Pakistan (in personam) with the condition that this case cannot
be quoted as precedent in future cases.

9. In fact, as per policy, the employees of such autonomous

organizations, established through a resolution are extended the
benefit of fixation of pay in the manner set out in FR 22 on their
subsequent appointment in the government service if they have
adopted government pay scale scheme in totality. Furthermore, the
employees of Atomic Energy Commission of Pakistan have SPS,
therefore, they were not entitled for protection of pay in terms of
policy guidelines issued vide Finance Division's O.M.No.4(2)R-2/96
dated 12-08-2002. Neither any such critical aspect was discussed by
the FST in the impugned judgment nor was any such assistance
provided by the learned counsel for the respondent No.1 to advert to
this essential facet of the case.

10. If we look into the niceties of F.R.22, it depicts the criteria of

regulating initial substantive pay of a government servant who is
appointed substantively to a post on a time-scale of pay and explains
that when appointment to the new post involves the assumption of
duties or responsibilities of greater importance (as interpreted for the
purposes of rule 30) than those attaching to such permanent post,
will draw as initial pay the stage of the time-scale next above his
CP.687/2022 -8-

substantive pay in respect of the old post and when appointment to

the new post does not involve such assumption, he will draw as
initial pay the stage of the timescale which is equal to his substantive
pay in respect of the old post, or, if there is no such stage the stage
next below that pay plus personal pay equal to the difference, and in
either case will continue to draw that pay until such time as he would
have received an increment in the timescale of the old post or for the
period after which an increment is earned in the timescale of the new
post, whichever is less. But if the minimum pay of the time-scale of
the new post is higher than his substantive pay in respect of the old
post, he will draw that minimum as initial pay.

11. This Court in the case of “Muhammad Azam Chaudhry Vs.

Federation of Pakistan”, (Civil Appeal No.1158 of 2009) in an
identical controversy granted the leave to appeal on 03.08.2009 in
the following terms:

“The petitioner was employed as Assistant Librarian (B-

17) in Barani Agriculture College Rawalpindi,
Government of Punjab on 05.01.1987. The College was
converted to University of Arid Agriculture by Act V of
1995. Later the petitioner was appointed in the Ministry
of Education as Director (B-19) on 12.07.2004 through
the Federal Public Service Commission. Before joining
the Ministry of Education, his salary was Rs.14,570/-
whereas upon joining, his pay was fixed as Rs.12,400/.
He filed departmental appeal for protection of his pay
drawn by him in B-18 before joining Ministry of
Education. After his appeal was rejected he appealed to
the Federal Service Tribunal. By the impugned
judgment, the Tribunal referring FR 22, held that the
protection of pay would not be granted to a civil servant
relating to his previous service in an autonomous body
and that protection of pay was restricted to earlier
service as civil servant.

2. Learned counsel for the petitioner has cited the

judgment of this Court in the case of Syed Abdus Samad
Pirzada V. Government of Punjab (2008 PLC (C.S) 264)
to contend that the protection of pay is equally
applicable regarding the salary drawn by a civil servant
previously in an autonomous body.

3. In the light of the said pronouncement, we grant leave

to appeal to consider as to whether the Federal Service
Tribunal had not erred in not granting relief prayed for
to the petitioner.”
CP.687/2022 -9-

12. After granting leave to appeal in the aforesaid terms, the Civil
Appeal was heard by five members Bench and vide judgment dated
17.02.2016, it was held that the appellant was an employee of the
statutory autonomous body having switched over to Government
Service is a different creed of employees and cannot claim the benefit
of F.R.22 and F.R.22 (a)(i) or (ii) of 1992 which is applicable to Civil
Servants on their appointment subsequently to another post as a
Civil Servant. The appellant thus failed to make out a case for
interference, hence the appeal was dismissed.

13. Yet again in the case of “The Ministry of Finance through

Secretary Government of Pakistan, Islamabad Vs. Atiq-ur-Rehman
and another” (C.P. No.5046 of 2017), while deciding the similar
controversy, this Court relied on the judgment rendered by a five-
member bench of this Court in C.A.No.1158 of 2009, and found it
squarely applicable to the case, therefore, the respondent (in that
case) was not allowed the benefit of pay protection being an employee
of autonomous body and since the impugned judgment of FST dated
12.10.2017 was not found in line with the five members bench
judgment, it was set aside by this Court.

14. Neither the FST considered the relevant Fundamental Rules nor
the pith and substance of relevant Office Memorandums issued from
time to time on the subject. Even it failed to consider the five member
judgment of this Court but only relied on its earlier judgment passed
in Appeal No.1730(R)CS/2015, which was challenged in this Court
but the civil petition was dismissed on technical grounds and no
question of law was decided, rather this Court merely dismissed the
petition due to non-availability of certain papers/notifications on
record, which order in our view cannot be treated an order or
judgment in rem but on the face of it an order in personam.
According to Wharton’s Law Lexicon (Fifteenth Edition), a “judgment
in rem” is one which declares, defines or otherwise determines the
jural relation of a person or thing to the world generally. Ref:
Satrucharla v. Vijayarama (2006) 1 SCC 212. A judgment “in rem”
amounts to a decision on the status of a specific matter or an
individual’s rights in respect of a certain matter, which is not only
conclusive between the contesting parties but also as against
the world. Whereas the expression “in personam”, is also
a Latin phrase which means “against or affecting a specific person
CP.687/2022 -10-

only; imposing a personal liability, rights and duties”. The lawsuit or

legal proceedings against a particular person and order or judgment
falling within this classification can be enforced against that
particular person but not in rem. A judgment “in personam” can be
described as a judgment that defines, the rights against contesting
persons in relation to a particular subject, or to compel the
performance of a particular act or breach of some contractual
obligations.

15. In fact, this Court nip it in the bud while dealing the case of
Muhammad Azam Chaudhry (supra), wherein it decided the question
of law while interpreting the nitty-gritties of F.R-22 vide its judgment
dated 17.02.2016. According to the exactitudes of Article 189 of the
Constitution of Islamic Republic of Pakistan 1973, any decision of
the Supreme Court shall, to the extent that it decides a question of
law or is based upon or enunciates a principle of law, is binding on
all other courts in Pakistan. The rule of conclusiveness is one of the
most inflexible principles of the law. A solemn decision upon a point
of law arising in any given case becomes an authority. The Courts
and Tribunal are bound to follow that decision so long as it stands
unreversed. The doctrine of precedents vis-à-vis stare decisis, since
both have fundamental values engrained in our judicial system to
ensure an objective of certitude and firmness.

16. The impugned judgment was passed by the FST on 05.01.2022

on the foothold that when contract employees who are also non-civil
servants, can get their pay-protection vide Finance Division's O.M
dated 31.05.2013, then it would be discriminatory not to allow the
benefit of pay-protection to other non-civil servants. In our view,
there was no rationale to compare or equate two different creed of
employees within the one and the same employment status/pattern
to invoke or bring up the equality clause or treating it discriminatory
rather than considering the grant of pay-protection strictly in
accordance with the applicable rules and policy. The FST overlooked
and disregarded the judgment rendered by this Court in the case of
Muhammad Azam Chaudhry (supra) wherein it was categorically
held the employee of statutory autonomous body having switched
over to Government Service is a different creed of employees and
cannot claim benefit of F.R.22 and F.R.22 (a)(i) or (ii) of 1992
applicable to Civil Servants on their appointment subsequently to
another post as a Civil Servant. In the case of Justice Khurshid
CP.687/2022 -11-

Anwar Bhinder and others v. Federation of Pakistan and

another (PLD 2010 SC 483), it was held by this Court that where
the Supreme Court deliberately, and with the intention of settling the
law, pronounces upon a question of law, such pronouncement is the
law declared by the Supreme Court within the meaning of Article 189
of the Constitution is binding on all the Courts of Pakistan. It was
further held that even obiter dictum enjoys a highly respected
position as if “it contains a definite expression of the court’s view on
a legal principle or the meaning of law”.

17. It is well-settled exposition of law that when any decision of Court

or Tribunal is found in ignorance or lack of knowledge of a relevant
statutory provision or a binding decision of court of earlier provisions
or decisions, it is called a decision per incuriam when it vividly put
on show that the decision was made in unfamiliarity/ignorance or
obliviousness of pertinent statues or precedents as done in this case
by the FST.

18. In wake of the above discussion, the aforementioned civil petition

is converted into an appeal and allowed. As a consequence, thereof,
the impugned judgment passed by the FST is set aside and Service
Appeal filed by the respondent No.1 before FST is also dismissed.

Judge

Judge

Judge
Islamabad
05.12.2024
Khalid
Approved for reporting.