JUDGMENT Gulab C. Gupta, C.J. 1. Petitioner No. 1 is an Association of Diploma Engineers, employed in various posts under the Respondent Electricity Board and challenges legal validity of the Order No. 57 dated 29-10-1993 (Annexure P-5) withdrawing grant of time bound promotional benefits to the Diploma Engineers, by filing this writ petition under Article 226 of the Constitution of India. Petitioners No. 2 and 3 are the members of the aforesaid Association who had enjoyed or entitled to enjoy the benefits of the said time-bound-promotional-Scheme and have joined Petitioner No. 1, in this common quest. 2. It appears that after the Respondent Board was formed in the year 1971, all the employees of erstwhile Public Works Department and department of M.P.P. and Power of the State Government were transferred to it The Respondent-Board seems to have felt that some employees were stagnating on their posts for a long period due to nonavailability of promotional avenue and the said stagnation was one of the reasons for deteriorating work culture. The Respondent-Board, therefore, introduced a scheme to allow time-bound-benefits of promotional scales to its employees after completion of 9/16 years of regular service and issued office order No. 12 dated 31-11991 (Annexure P-l), in this behalf. As a consequence to the adoption of the aforesaid Scheme, the Respondent-Board also issued office-order No. 14, dated 31-1-1991 (Annexure P-2) and ordered that the Assistant/Assistant Executive Engineers would be placed in the next higher scale of Rs. 3,000-5,600 with a minimum pay of Rs. 3,500 in the 10th year of their service i.e. after completion of 9 years of regular service as Assistant Engineer/Assistant Executive Engineer. It was also provided that on completion of 16 years of regular service such employee would be promoted to the next higher scale of Rs. 4,500-6,300. The Scheme was made applicable with retrospective effect from 1-1-1986, and was very well received by the employees of the Respondent Board. Para-2 of the office order. No. 14 (Annexure P-2) which is the basis of the Petitioners' claim in this writ petition, permitted benefit of the Scheme to the Assistant Engineers irrespective of their educational qualifications, i.e. Diploma Holders and Degree Holders, were treated as forming part of the same cadre. Para-2 of the office order. No. 14 (Annexure P-2) which is the basis of the Petitioners' claim in this writ petition, permitted benefit of the Scheme to the Assistant Engineers irrespective of their educational qualifications, i.e. Diploma Holders and Degree Holders, were treated as forming part of the same cadre. The note reads as under: Note.-The Departmental employees (Technical Subordinates and Drawing Staff) who while in service of the Board have been promoted to the post of Assistant Engineer against quota reserved for promotion from amongst them as per R and P Regulations shall be deemed to have been appointed as Assistant Engineers like the Assistant Engineers appointed through direct appointment for the purpose of grant of next higher scales after 9/16 years of regular service as A.E./A.E.E./XEN prescribed period to be counted from the date of joining the post of Assistant Engineer on regular basis. Similarly graduates in Engineering/AMIE qualified hands who possess this qualification before joining the service of the Board and subsequently promoted as Assistant Engineer against quota reserved for promotion from amongst them will be treated likewise. Since the benefit of the aforesaid time-bound promotional Scheme was given to all the Assistant Engineers irrespective of their educational qualification, they were individually fixed in the higher pay scales on the date they were due, as would be clear from the Order No. 32 dated, 28-2-1993 and Order No. 45, dated 20-3-1992 (Annexures P-3 and P-4), issued by the Respondent Board in this behalf. 3. After the aforesaid Scheme had been worked out from January 1991 till October 1993, the Respondent-Board issued an amendment to the same and changed the note attached to Para-2 of the Scheme Annexure P-2 As a result of this amended note the Diploma Holders working as Assistant Engineers became ineligible to the benefits of time-bound promotional Scheme It is this amended note which is the subject matter of challenge in this writ petition. The note as contained in Office Order No. 57, dated 29-10-1993 (Annexure P-5) reads as under: The Hiinachal Pradesh State Electricity Board is pleased to substitute following Note in place of existing Note appearing below para-2 of this Office Order No. 14/HPSEB (SECTT)/91 dated 31-1-91 endorsed vide No HPSEB (SECTT)/Scale-1-1/-91 11727-947 dated 31-1-1991: Note.-The Departmental employees (Technical Subordinates and Drawing Staff) who while in service of the Board, have acquired degree in Engineering or passed A.M.I.E. in full and has been promoted to the post of Assistant Engineers, against quota reserved for promotion from amongst them in the Recruitment and Promotion Rules shall be deemed to have been appointed through direct recruitment for the purpose of grant of above next higher scales after 9/16 years of regular service as A.E./A.E.E./XEN, prescribed period to be counted from the date of joining the post of Assistant Engineer on regular basis. Similarly graduates in Engineering/AMIE qualified hands who possess this qualification before joining the service of the Board and subsequently promoted as A.E. against quota reserved for promotion from amongst them in the Recruitment and Promotion Rules will be treated likewise. 2. All other terms and conditions of the order ibid shall remain unchanged. 4. The effect of this amendment is not only to deny benefits to Diploma Holders in future but also withdraw the benefits from those who have already been given the same prior to the issuance of this amendment. The Petitioner No. 2 who had completed 16 years of service on 31-12-1986 and w as granted by the pay scale of Rs. 4500-6300 vide Annexure P-3 and was paid arrears of about Rs. 30,000, is now threatened with the denial of the said benefits. This Petitioner alleges that he will be required to refund the aforesaid benefits Similarly, Petitioner No. 3 had completed nine years of service as Assistant Engineer on 30-11-1993 and had become entitled to the benefit of promotional-scale, as per the Scheme, but will not now be granted the said benefit. This amendment. (Annexure P-5) is alleged to be arbitrary and discriminatory, violating Articles 14 and 16 of the Constitution of India. It is particularly submitted that making distinction between the Assistant Engineers based on their educational qualification after their amalgamation in a cadre is not justified. This amendment. (Annexure P-5) is alleged to be arbitrary and discriminatory, violating Articles 14 and 16 of the Constitution of India. It is particularly submitted that making distinction between the Assistant Engineers based on their educational qualification after their amalgamation in a cadre is not justified. They have, therefore, prayed that this Court be pleased to quash the aforesaid amendment by a writ in the nature of certiorari and direct the Respondent Board by a writ of mandamus to continue giving them the benefits under the Scheme originally enacted. 5. The Respondent-Board have in its reply stated that the Board had been following the pattern available in the Punjab Electricity Board. According to them the amendment is a mere substitution and an elaboration of the note existing in para-2 of the Order (Annexure P-2). According to them, the Assistant Engineers directly recruited were only entitled to the aforesaid benefits and not the Diploma Holder Assistant Engineers who are mostly promoted to the said posts. The classification of the Assistant Engineers based on their educational qualifications is said to be in accordance with law and hence allegations of arbitrariness and discrimination are denied It is further submitted that this is also the pattern in the Punjab State Electricity Board and hence the Petitioners could not claim anything more than that. 6. From the aforesaid, it is obvious that the scheme as originally formulated and introduced by Order dated 31-1-1991 (Annexure P-2) granted the benefit of time-bound-promotions to the Assistant Engineers irrespective of their educational qualification and irrespective of their mode of appointment, that is why the Diploma Holders, like the Petitioner No. 2, were also granted the said benefit. It is equally clear that the purpose of amendment vide Annexure P-5 is to deny Diploma Holder Assistant Engineers the benefit of the promotional Scheme. It is also clear that those Assistant Engineers (Diploma Holders) who have already been granted the benefit of the said Scheme will now be required to refund the benefits and be down-graded in the scale in future. 7. As far as withdrawal of benefits from Diploma Holders who have already been granted the same, it is sufficient to observe that the same cannot be done without observing the principles of natural justice. In this connection the recent decision of the Supreme Court in Bhagwan Shukla v. Union of India and Ors. 7. As far as withdrawal of benefits from Diploma Holders who have already been granted the same, it is sufficient to observe that the same cannot be done without observing the principles of natural justice. In this connection the recent decision of the Supreme Court in Bhagwan Shukla v. Union of India and Ors. AIR 1994 SC 2480 be noticed, wherein it has been laid down that reduction of pay with retrospective effect without giving to employee concerned an opportunity to show-cause, is violative of Article 14 of the Constitution. This, according to the Supreme Court, is the requirement of principles of natural justice as also fair play in action. It is not the case of the Respondent that they have given any notice to any Diploma Holder Engineers before issuing Annexure P-5. Under the circumstances, the order cannot have the effect of withdrawing the benefits from persons who have already been granted the same. 8. The question requiring our serious consideration is whether the Respondents have any authority to issue an order like Annexure P-1 and apply the same with retrospective effect. As far as statutes are concerned, it is the cardinal principle of construction that every statute is prima facie prospective unless it is expressly or by necessary implication made to have retrospective effect. The decisions of the Supreme Court in State of M.P. v. Rameshwar Rathod AIR 1990 SC 1849; Mithilesh Kumari v. Prem Bahadus Khare AIR 1989 SC 1247 ; and Arjan Singh v. State of Punjab AIR 1970 SC 703, are some of the cases decided by the Supreme Court laying down the aforesaid legal principles. It is also equally well settled that provision which affect a right in existence at the time of passing of the statute is not to be applied retrospectively in the absence of express enactment or necessary intendment. The decisions quoted aforesaid also lay down that every statute which takes away or impairs vested rights acquired under existing laws, or creates a new obligation or imposes a new duty or attaches a new disability in respect of transactions already past, must be presumed to be intended not to have retrospective effect. As far as vested existing rights are concerned, the statute cannot affect them But these are the principles applicable to a statute and not to an administrative order. As far as vested existing rights are concerned, the statute cannot affect them But these are the principles applicable to a statute and not to an administrative order. The impugned order has not been passed under any statutory provision and hence its legality or efficacy cannot be judged on the basis of the aforesaid legal principles. No decision of any Court has been brought to our notice which may justify application of the aforesaid legal principles to administrative orders. Under the circumstances, it must be held that administrative order cannot affect existing rights and for that reason cannot be given retrospective effect. In this connection the decision of the Supreme Court in State of M.P. v. Tikamdas (1975) 2 SCC 100 and Union of India v. Madan Gopal AIR 1954 SC 158, deserve-special mention. Tikam Dass case (supra) dealt with the rule making authority of the State Government and held that "there is no doubt that unlike legislation made by a sovereign Legislature, subordinate legislation made by a delegate cannot have retrospective effect unless the rule making power in the concerned statute expressly or by necessary implication confers power in this behalf. If this be the law in relation to exercise of statutory power, the rule against retrospectivity will apply with greater force in case of administrative orders. 9. Then even if it is to be assumed that administrative orders can also, in law, have retrospective effect, there is nothing in Annexure P-5 to justify an inference that it intends to take away the rights already granted. Indeed, the order only substitutes the note without intending that its effect will be as if it was there from the date of the original order. Under the circumstances, we have no doubt that the substituted note cannot take away or withdraw the benefits already granted by the Respondent-Board to its employees, pursuance to the Scheme in Annexures P-1 and P-2. 10. The next important question is whether the impugned note in its application in future is arbitrary and discriminatory? It is common ground that Assistant Engineers are appointed by direct recruitment as also by promotion. Once they are integrated in the cadre of Assistant Engineers, persons drawn from both the sources performs same functions, shoulder similar responsibilities and are put in the same pay scale. The stagnation is equally shared by the Assistant Engineers recruited from both the sources. It is common ground that Assistant Engineers are appointed by direct recruitment as also by promotion. Once they are integrated in the cadre of Assistant Engineers, persons drawn from both the sources performs same functions, shoulder similar responsibilities and are put in the same pay scale. The stagnation is equally shared by the Assistant Engineers recruited from both the sources. Once the appointees from two sources are integrated, as aforesaid, it will require something more to make a distinction between them. Nothing whatsoever has been brought to our notice so as to justify the aforesaid distinction The purpose of the Scheme is to avoid stagnation by granting a higher pay-scale. Since the stagnation is relevant to both the categories, the classification has no rational-nexus with the aforesaid object. Such a classification is not permissible in law and must for that reason be held to be violative of Articles 14 and 16 of the Constitution. 11. We also see yet another discrimination in case the impugned order is allowed to operate prospectively. In such a situation, the Diploma Holder Assistant Engineers who have already got the benefit of the time-bound promotion Scheme would continue to enjoy the same but others like Petitioner No. 3, would be denied. In this process, there will be classification within the Diploma Holder Assistant Engineers as well which is not intended by the impugned order. Clearly, therefore, the impugned order does not even satisfy the test of reasonableness and for that reason deserves to be quashed. 12. The petition consequently succeeds and is allowed. The impugned order Annexure P-5 is hereby quashed. As a consequence the Scheme contained in Annexure P-2 will apply to all the Assistant Engineers irrespective of their educational qualifications. No costs.