(1) THE Damodar Valley Corporation (hereafter referred to as DVC) constituted under central Act XIV of 1948 and its General Manager respectively are the appellants in this appeal by special leave directed against the judgment of the division bench of the Patna High court. (2) IN the early years of the setting up of the Corporation, several employees were recruited in its diffe- rent sections. Gradually the field of activity of the Corporation expanded. in due course, in exercise of the powers under S. 60 of the Act, the corporation framed regulations. Regulation 14 providing for promotion of employees, runs thus:- "PROMOTION shall be based on merit, relative suitability of a candidate for a particular post and seniority and shall, in the case of promotion to Class I, be made ordinarily after considering the advice of the Departmental Promotion Committee to be set up for the purpose. Their functions and procedures shall be similar to such committees functioning under the central government with suitable modifications." in March, 1960, the Corporation decided to introduce qualifying tests as a condition precedent to promotion. The respondents who moved the High court under Article 226 of the constitution belong to the operational S. working in the Thermal Power units located at Durgapur, Bokaro and Chandrapura. As already mentioned, in the initial years in the absence of suitable candidates in sufficient number, the local candidates had been recruited without strict Insistence upon qualification. The Selection Committee allowed a group of 31 employees promotion without insisting upon examination on condition that they should pass the departmental examination within a fixed period thereafter, in course of five years they failed to pass such examination and no reversion was ordered as the management apprehended trouble over the matter. The writ petition was filed in the High court challenging the system of departmental examination for promotion banking upon the exception granted as aforesaid and insistence upon holding of such examination in respect of others. The High. court found that the management was guilty of discriminatory treatment and, therefore, quashed Annexures 3, 5A and 10 and directed the management to make appointments in accordance with regulations and law. (3) TWO contentions were advanced by Mr. The High. court found that the management was guilty of discriminatory treatment and, therefore, quashed Annexures 3, 5A and 10 and directed the management to make appointments in accordance with regulations and law. (3) TWO contentions were advanced by Mr. Mukherjee on behalf of the Corpora tion: "(1) Valid regulations prescribed screening and departmental tests for promotion and the High court should not have interfered with the appointments made according to law, and (2) in the special situation indicated above, the High court should have come to hold that it was not a case of discrimination and the explanation given by the management with reference to the peculiar situation should have been accepted. " On the other hand, Mr. Asoke Sen appearing for the respondent-employees maintained that in respect of recruits in the initial period there was no provision for any examination for earning promotion and later regulations providing for screening and departmental examinations would not govern recruits prior to the enforcement of the regulations. He also contended that aubaequfent recruits are more qualified and if there is insistence upon examination, promotional avenues would be really closed for the earlier recruita. (4) IT is not di-sputed on either side that soon after the Corporation was set up, a set of employees were recruited without insistence upon qualification and many of them have since retired but there are some who are still continuing in service. Obviously with the passing of time they have gathered experience in their jobs. The job requirement in most of the employments in the Corporation is technical or semi-technical. There seems to be good basis in the submission of Mr. Sen for the respondent-employees that if it is a case of competition to secure promotion between the old employees and the later recruits, the prospects of promotion for old employees may be bleak but that does not seem to be a consideration which can stand the test of law. There is no merit in the stand taken by Mr. Sen that the Corporation cannot make regulations providing for tests. Obviously these are intended to operate prospectively and itis always open to the employer to make regulations prospectively regulating conditions of service. Admittedly, the benefits accruing are not intended to be affected. There is no merit in the stand taken by Mr. Sen that the Corporation cannot make regulations providing for tests. Obviously these are intended to operate prospectively and itis always open to the employer to make regulations prospectively regulating conditions of service. Admittedly, the benefits accruing are not intended to be affected. (5) WE direct that the promotions already effected shall not be challenged on the ground that screening or departmental tests were not cleared by those who had been promoted. All promotions to be granted in future should be in strict compliance with the regulations. We would like to make it clear that passing of the examination has nothing to effect the seniority in the present categories and if seniority lists have been drawn up taking into account passing and nonpassing of examinations, appropriate revision should be effected. (6) SUBJECT to these clarifications, the appeal is disposed of. There would be no order for costs.