2026 INSC 769 | 30 July 2026
What the case was about
This appeal asked whether a long-standing promotion in a Chhattisgarh cooperative bank should be undone because the rule that cleared the way for it was allegedly changed without proper authority. S.P. Chandrakar had been promoted to Additional Manager in December 2010 after a bar on moving technical employees into non-technical posts was removed. Thirteen years later, the High Court quashed that promotion at the behest of a rival employee, Kishor Bagh. The Supreme Court had to decide whether the rule change was valid, whether it was merely an executive instruction, and whether such a belated challenge could stand.
The key facts
Chandrakar and Bagh are employees of the District Central Cooperative Bank Ltd, Raipur. Their service is governed by the Chhattisgarh District Cooperative Central Bank Employee Service Rules, 1982, framed under Section 55 of the Chhattisgarh Cooperative Societies Act, 1960. Rule 5(3)(a) originally prevented employees appointed to technical posts from being absorbed into non-technical posts such as Additional Manager.
By notification dated 4 July 2005, the Registrar substituted clauses (a), (b) and (c) of Rule 5(3). Subsequently, on 13 August 2010, the Additional Registrar issued a communication deleting Rule 5(3)(a) explicitly “ordered by the Registrar.” Acting on this, the Bank promoted Chandrakar to Additional Manager on 30 December 2010. Bagh challenged the promotion in writ petition No. 1799 of 2011. In July 2023, a Single Judge quashed the promotion, and in February 2024 the Division Bench of the Chhattisgarh High Court affirmed that order, holding that the amendment was a non-statutory executive instruction. Chandrakar appealed.
The questions before the Court
The Supreme Court examined four principal questions:
- Did the Registrar possess the power under Section 55(1) of the 1960 Act to delete Rule 5(3)(a)?
- Was the 13 August 2010 communication a valid exercise of statutory rule-making power, or merely an executive circular incapable of overriding the 1982 Rules?
- Was the requirement under Section 95(3) of the 1960 Act to lay amended rules before the Legislative Assembly mandatory or directory, and did non-compliance invalidate the amendment?
- Could the promotion granted in 2010 be quashed after such a long lapse of time?
What the Court decided and why
A bench of Justices Sanjay Karol and Augustine George Masih allowed the appeal, set aside the High Court judgments, and reinstated Chandrakar.
On the power to delete the rule, the Court held that Section 55(1) conferred on the Registrar the power to frame rules governing service conditions. This power inherently includes the authority to amend, alter or delete existing rules. The bench relied on Section 21 of the General Clauses Act, 1897, which provides that a power to issue or frame rules carries with it the power to “add to, amend, vary or rescind” them (para 10).
The Court also rejected the argument that the Additional Registrar lacked authority. The communication of 13 August 2010 expressly stated it was “ordered by the Registrar,” and the State did not dispute that the amendment was made under the Registrar’s statutory power. In these circumstances, the fact that the Additional Registrar signed the document did not vitiate the exercise (para 10).
Addressing the laying requirement under Section 95(3), the Court observed that although the word “shall” is used, the statute prescribes no consequence for failure to lay the rules before the Assembly. Citing settled precedent, it noted that where a statute requires an act to be done in a prescribed form but remains silent on the consequence of non-compliance, the provision must be construed in light of the legislature’s object and the injustice that invalidation would cause (para 12.3). Applying the principle that general inconvenience and injustice to innocent persons should be avoided, the Court concluded that the laying procedure is directory, not mandatory; non-compliance could not defeat the Registrar’s valid exercise of power (paras 13–14).
The High Courts had treated the 13 August 2010 instrument as a mere executive communication. The Supreme Court disagreed. It held that once the underlying statutory power exists and is exercised, the label attached to the instrument—whether “circular,” “order,” or “notification”—is immaterial. The authority’s substantive power, not the document’s nomenclature, determines its validity (para 15).
Finally, the Court held that Chandrakar’s promotion could not be disturbed after thirteen years. Although the writ petition had been filed in 2011, judicial delay meant the final quashing order came only in 2023–2024, by which time Chandrakar had served continuously in the post. Setting aside a promotion resting on a valid exercise of power after such a long interval would be unjust (para 16). The Court directed his reinstatement as Additional Manager with protected seniority and all consequential benefits, and awarded 50 per cent back wages payable within two months, failing which interest at 6 per cent per annum would apply (para 16).
Why it matters
The judgment provides clear guidance on three areas of administrative and service law. First, it reaffirms that the power to frame delegated legislation necessarily includes the power to amend or rescind it, and that subordinate officers may validly communicate such changes when acting on the principal authority’s orders. Second, it restates the principle that legislative “laying” requirements, where no penalty or invalidating consequence is prescribed, are directory; procedural non-compliance does not automatically render subordinate legislation void. Third, it underscores that the form of an official act is less important than the substantive power behind it, and that long-standing promotions should not be toppled when they were granted under colour of valid authority. For public servants and employers alike, the decision strengthens the expectation of stability in service matters after years of uninterrupted tenure.