JUDGMENT 1. 1. Petitioner seeks to quash clause 7.1 of the Promotion Policy for Officers of the National Insurance Company which provides that `selection for promotion shall be based on seniority, Insurance qualification and merit cum growth potential as brought out in performance appraisals.' For promotion in the cadre of Dy. Manager, this clause allocates 30 marks for seniority and rest 70 marks for Traits in C.R., performance and Growth Potential. The grievance of the petitioner is that this clause changes the criterion `Seniority-cum-merit' to that of `Merit-cum-seniority' and the same cannot have any rational basis. Allocation of marks prescribed under the said clause is absolutely irrational and has got no nexus with the object sought to be achieved and the same therefore, deserves to be set aside. 2. On June 1, 1995 the respondents published it combined seniority list of Mangers/Deputy Managers and Assistant Managers. The name of the petitioner was placed at No. 106 in the list of Assistant Managers. The petitioner's name was within the zone of consideration for promotion to the post of Deputy Manager but he was superseded and persons junior to him were promoted against the quota of 1996-97 vide order dated July 17, 1996. The petitioner submitted representation on August 12, 1996 seeking reconsideration of the said order of promotion but no heed was paid to it and vide order dated September 19, 1996 those who were found suitable were promoted as Deputy Manager. Thereafter vide order dated Sept. 30, 1996 final list of Deputy Manager was published. The petitioner also seeks to set aside the aforequoted orders dated July 17, 1996, Sept. 19, 1996 and Sept. 30, 1996. 3. I have heard learned counsel appearing for the parties and scanned the record. 4. The National Insurance Company published the promotion policy in order to rationalise and codify the existing guidelines relating to promotions within the officers cadre (Class I). Clause 1.2 of the said policy provides thus:- "1.2 This is aimed to be achieved by providing for promotion of officers through a process of selection on the basis of their seniority cum merit, while seniority is a known fact depending upon the number of years of service put in, merit would inter alia comprise job knowledge, past performance, suitability and growth potential. These are to be assessed on the basis of performance appraisal system. These are to be assessed on the basis of performance appraisal system. Suitability and growth potential can be assessed from recommendations and remarks of officers in the appraisals and interviews, where applicable." (Underlining is mine) 5. A look at clause 1.2 of promotion policy clearly demonstrates that criterion prescribed for promotion to the post of Dy. Manager was `Seniority-cum-Merit'. 6. In B.V. Sivaiah v. Addanki Babu, (1998) 6 SCC 720 , the question that falls for consideration before their Lordships of the Supreme Court was as to what is meant by `Seniority-cum-Merit', the criteria prescribed for promotion to the post of Area Manager/Senior Manager in the Regional Rural Banks under the Regional Rural Banks (Appointment and Promotions of Officers and other Employees) Rules, 1988. Their Lordships in para 18 observed as under:- "We thus arrive at the conclusion that the criterion of `seniority-cum-merit' in the matter of promotion postulates that given the minimum necessary merit requisite for efficiency of administration, the senior, even though less meritorious, shall have priority and a comparative assessment of merit is not required to be made. For assessing the minimum necessary merit the competent authority can lay down the minimum standard that is required and also prescribe the mode of assessment of merit of the employee who is eligible for consideration for promotion. Such assessment can be made by assigning marks on the basis of appraisal of. performance on the basis of service record and interview and prescribing the minimum marks which would entitle a person to be promoted on the basis of seniority-cum-merit." (Underlining is mine) 7. Before I proceed to consider the question as to whether the aforequoted criterion has been followed in letter and spirit by the respondent Insurance Company in making the promotion under challenge, I deem it necessary to draw distinction between the criterion `seniority-cum-merit' and `merit-cum-seniority' in the matter of promotion. This distinction was drawn by the Hon'ble Supreme Court in B.V. Sivaiah's case (supra) and it was indicated that the principles of `merit-cum-seniority' lays great emphasis on merit and ability and seniority plays a less significant role, seniority is to be given weight only when merit and ability are approximately equal; on the other hand, as between the two principles of seniority and merit, the criterion of `seniority-cum-merit' lays greater emphasis on seniority. But an officer cannot claim promotion as a matter of right by virtue of his seniority alone and if he is found unfit to discharge the duties of the higher post, he may be passed over and an officer, junior to him may be promoted. (Underlining is mine) 8. In B.V. Sivaiah's case their Lordships of the Supreme Court considered circulars issued by various Banks. In the circular dated 27.9.1989 issued by Rayalascema Grameena Bank sets apart only 34 marks for seniority out of total number of 120 marks only those officers who had secured the highest number of marks were ultimately promoted. It was held that mode of selection was contrary to the principles of `seniority-cum-merit'.In the circular dated 16.3.1992 issued by Pinakini Grameena Bank out of total number of 100 marks, 55 marks to be awarded for seniority. There was no indication in the circular as to how 55 marks for seniority were to he given. It did not prescribe minimum qualifying marks for assessment of performance and merit on the basis of which an officer would be considered for selection. It was held that selection was contrary to the principle of seniority-cum-merit.Circular dated 2.2.1989 of Rewa Sidhi Gramin Bank prescribed that candidates who have secured less than 40% marks in interview will not be considered for promotion. It was further laid down that the list of successful candidates in the order of total marks obtained will be placed before the Board. It was held that circular was not in consonance with the principle of `seniority-cum-merit'.In the circular issued by Chhindwara Seoni Kshctriya Gramin Bank, 50 out of 100 marks were prescribed as qualifying marks for interview and only those who had obtained the qualifying marks in interview were selected for promotion on the basis of seniority. It was therefore a case where a minimum standard was prescribed for assessing merit of candidates and those who fulfilled the said minimum standard were selected for promotion on the basis of seniority. It was held that selections were made in accordance with the principles of seniority-cum-merit. 9. Admittedly the case on hand is not a case where minimum qualifying marks are prescribed for assessment of performance and merit and those who secure the prescribed minimum qualifying marks are selected for promotion on the basis of seniority. It was held that selections were made in accordance with the principles of seniority-cum-merit. 9. Admittedly the case on hand is not a case where minimum qualifying marks are prescribed for assessment of performance and merit and those who secure the prescribed minimum qualifying marks are selected for promotion on the basis of seniority. According to clause 7.1 of the Promotion Policy selection for promotion is to be based on seniority, Insurance qualification and merit cum growth potential as brought out in performance appraisals. This clause sets apart only 30 marks for seniority out of total number of 100 marks and only those officers who secured highest number of marks were ultimately promoted. Under these circumstances it cannot be held that clause 7.1 is in consonance with the principle of `seniority-cum-merit'. As already stated the Promotion Policy was issued by the respondent company in order to achieve the aim by providing for promotion of officers through a process of selection on the basis of seniority-cum-merit. But while framing clause 7.1. the object behind issuance of the policy was totally forgotten and criterion 'seniority-cum- merit' was converted into that of 'merit cum seniority' without any rational basis. Allocation of marks prescribed in clause 7.1 is absolutely irrational and has got no nexus with the object sought to be achieved. 10. I have closely weighed the reply submitted by the respondents. An objection was raised that the respondent company was not amenable to writ jurisdiction as it is not a State within the meaning of Article 1.2 of the Constitution. There is no substance in this contention. Respondent company is a Government of India undertaking controlled by Ministry of Finance, Department of Insurance and it is a State within the meaning of Article 12 of the Constitution of India. It was further averred by the respondent company that the petitioner was not found suitable as he secured less marks in promotional exercise. This contention would have been accepted, had the selection for promotion been based on criterion of 'merit cum seniority' but looking to the object of Promotion Policy the respondent ought to have prescribed minimum qualifying marks for assessment of performance and merit and to have selected those persons who secured the minimum qualifying marks on the basis of seniority. This contention would have been accepted, had the selection for promotion been based on criterion of 'merit cum seniority' but looking to the object of Promotion Policy the respondent ought to have prescribed minimum qualifying marks for assessment of performance and merit and to have selected those persons who secured the minimum qualifying marks on the basis of seniority. Minimum standard ought to have been prescribed for assessing merits of candidates and those who fulfilled the said minimum standard ought to have been selected for promotion on the basis of seniority. 11. The petitioner has impleaded affected persons as respondents No. 3, 4 and 5 in the representative capacity. They have also submitted reply to the writ petition and interest of all the affected persons has been taken care of and arguments were advanced by Mr. Ashok Gaur, learned counsel. It is therefore not necessary to implead all the affected persons as party in view of ratio of Arun Tewari's case (AIR 1998 SC 331). 12. I am unable to pursuade myself to agree with the submissions of learned counsel for the respondents that the respondent had acted in all fairness. Nowhere in the reply the respondents explained as to under what circumstances the criterion for seniority-cum-merit provided in clause 1.2 of the promotion policy was changed into that of `Merit-cum-Seniority' in clause 7.1. The petitioner who was at No. 106 in the seniority list of Assistant Managers, was superseded by adopting a different criterion which was against the object of the promotion policy. Allocation of marks prescribed under clause 7.1 is absolutely unreasonable and irrational and has got no nexus with the object sought to be achieved. Thus the orders of promotions passed on July 17, 1996, September 19, 1996 and September 30, 1996 are based on unreasonable and irrational clause 7.1 of the Promotion Policy is violative of Articles 14 and 16 of the Constitution of India. 13. For the reasons aforementioned the writ petition is allowed and I hold that the criterion for promotion to the post of Dy. Manager laid down in clause 7.1 of the Promotion Policy is contrary to the object incorporated in clause 1.2, therefore I quash it. I direct respondent Insurance Company to prescribe minimum qualifying marks for assessment of performance and merit and to select for promotion to the posts of Dy. Manager laid down in clause 7.1 of the Promotion Policy is contrary to the object incorporated in clause 1.2, therefore I quash it. I direct respondent Insurance Company to prescribe minimum qualifying marks for assessment of performance and merit and to select for promotion to the posts of Dy. Manager, those persons who secure the minimum qualifying marks on the basis of seniority. As a consequence of quashing of clause 7.1 of the promotion policy the orders dated July 17, 1996, September 19, 1996 and September 30, 1996 automatically stand set aside. Fresh exercise for promotion to the post of Dy. Manager shall be undertaken by the respondent company within a period of six months from the date of receipt of this order, after making necessary amendments in clause 7.1 as indicated hereinabove. There shall however be no order as to costs.Writ Petition Allowed. *******