ORDER The petitioners have prayed for a writ in the nature of certiorari to quash the award dated 21-7-1999 passed by the first respondent-the Additional Registrar of Co-operative Societies, Bangalore, and also, the order dated 27-4-2001 passed by the third respondent-the Karnataka Appellate Tribunal, Bangalore and for other reliefs. 2. Petitioners are the employees working in the second respondent-the Karnataka State Co-operative Agriculture and Rural Development Bank Limited (for short, 'the Bank'). The Bank by notification dated 3-9-1992 invited applications from internal candidates possessing the qualification of Law Degree of any recognised University to fill up the posts of Law Officers. Accordingly, the petitioners applied for the post of Law Officers. The Bank by order dated 28-1-1993 appointed these six petitioners as Law Officers. On 5-4-1993, the Bank fixed the pay scale of the petitioners in the cadre of Law Officers by excluding the personal pay that the petitioners were drawing before their appointment' as Law Officers. Aggrieved by this exclusion of personal pay while fixing their pay scales in the cadre of Law Officers petitioners approached the first respondent-the Additional Registrar of Co-operative Societies by raising a dispute under Section 70 of the Karnataka Co-operative Societies Act, 1959 in dispute No. DDSI D2/111O/97-98. The first respondent, by his award dated 21-7-1999 rejected the claim of the petitioners. Aggrieved by this, the petitioners filed an appeal before the third respondent-the Karnataka Appellate Tribunal, Bangalore (for short, 'the Tribunal'), in Appeal No. 506 of 1999 and the same came to be rejected vide order dated 27-4-2001. Hence, this petition. 3. Sri Somashekar, learned Counsel for petitioners contend, that the petitioners were drawing basic pay plus personal pay before their appointment as Law Officers. The second respondent-Bank in its notification dated 3-9-1992 inviting applications to fill the post of Law Officers stated, that they will protect the pay of petitioners. Now the Bank excluded the personal pay at the time of fixation of pay scale of petitioners as Law Officers. The first respondent under the impugned award and the Tribunal in its order wrongly proceeded on the assumption that the petitioners are demanding for payment of personal pay in addition to their pay as Law Officers. On the other hand the demand of the petitioners was to include the personal pay in the basic pay of the petitioners while fixing the new pay scale in the cadre of Law Officers. On the other hand the demand of the petitioners was to include the personal pay in the basic pay of the petitioners while fixing the new pay scale in the cadre of Law Officers. He contends, that pay includes personal pay. The petitioners were drawing more salary before their recruitment as Law Officers. The petitioners are now drawing a less salary in a higher post cadre. He further contends, that contrary to the notification dated 3-9-1992, the pay scale of petitioners is fixing by excluding the personal pay. He contends, that the definitions of the words 'pay', 'personal pay' and 'substantive pay' defined in the Subsidiary Rules of the Bank are to be read harmoniously and not in isolation. Reliance is placed on the following decisions: 1. The Chairman, Dharwar District Government Employees' Co-operative Bank Limited, Dharwar v. Marthand Bhimabai Hangal and Another; 2. Union of India and Another v. Shyama Pada Sidhanta and Others; 3. Sundar Lal Jain and Others v. State of Haryana and Others; 4. State Bank of India and Others v. K.P. Subbaiah and Others. 4. Per contra Sri K. Ananda, learned Counsel for the Bank contends, that as on the date of the petitioners' appointment as Law Officers they were not drawing any personal pay. Therefore, the question of including the personal pay of petitioners in their basic pay at the time of fixation of their pay scale in the cadre of Law Officers will not arise. He contends, that at the time of appointment of petitioners as Law Officers it was specifically stated in the order of appointment dated 28-1-1993 that the petitioners are not entitled for protection of their personal pay. He contends, that the pay does not include personal pay in view of the, definitions in the Subsidiary Rules of the Bank He justifies the impugned award and order. 5. Heard arguments on both sides and perused the entire writ papers. 6. It is not in dispute that prior to 28-1-1998, the petitioners were working as Superintendent, Technical Supervisor, Land Development Officer, Accounts Assistant, Console Operator etc. The second respondent-Bank by its order dated 28-1-1993 'selected the petitioners for the post of Law Officers. The post of Law Officer is a higher cadre than the one the petitioners were holding before 28-1-1993. It is not in dispute that prior to 28-1-1998, the petitioners were working as Superintendent, Technical Supervisor, Land Development Officer, Accounts Assistant, Console Operator etc. The second respondent-Bank by its order dated 28-1-1993 'selected the petitioners for the post of Law Officers. The post of Law Officer is a higher cadre than the one the petitioners were holding before 28-1-1993. Whenever a person is promoted/selected/recruited/upgraded to a higher cadre it is quite but natural to expect a better place both in status and also in the pay. The Supreme Court in the case of State Bank of India, held: " ... A pay scale has different stages starting with initial pay and ending with ceiling pay. Each stage in the scale is commonly referred to as basic pay The emoluments which an employee gets is not only the basic pay at a particular stage, but also the additional amounts to which he is entitled as allowance e.g. D.A. etc. Therefore, when a question of pay protection comes, the basic feature is that the fitment or fixation of pay in a particular scale must be such as to ensure that the total emoluments are not reduced". (emphasis supplied) In Sundar Lal Jain's case, a Division Bench of Punjab and Haryana High Court held as under: "... If there is no increase in the emoluments of a citizen on his promotion, no one would ever work with zeal and dedication nor would be ever like to acquire better experience and more qualifications This would result into complete stagnation. The action of the respondents in equating the promotional posts with that of inferior posts in the matter of pay scale would obviously result in restricting the natural aspiration of human being to go higher and higher in his service graph and would, thus, be wholly arbitrary". 7. Admittedly, the petitioners were drawing monthly pay plus personal pay before their appointment as Law Officers. After the appointment of petitioners as Law Officers the Bank vide order dated 5-4-1993 fixed the pay scale of petitioners by excluding the personal pay that was drawn by the petitioners. As a consequence the petitioners on being appointed as Law Officers were made to draw lesser pay scale than they were drawing before their recruitment as Law Officers. After the appointment of petitioners as Law Officers the Bank vide order dated 5-4-1993 fixed the pay scale of petitioners by excluding the personal pay that was drawn by the petitioners. As a consequence the petitioners on being appointed as Law Officers were made to draw lesser pay scale than they were drawing before their recruitment as Law Officers. Therefore, the impugned order of the second respondent-Bank' dated 5-4-1993 fixing the pay scale of petitioners by excluding their personal pay frustrated the legitimate aspiration of the petitioners. The impugned order of the Bank fixing the lower pay scale is therefore opposed to public policy and wholly arbitrary. 8. The Bank in its notification dated 3-9-1992 invited applications by way of internal recruitment from its employees possessing Law Degree to fill the post of Law Officers. In this notification dated 3-9-1992 it was specifically stated, that the 'present pay' of an employee will be protected on being appointed as "Law Officer". Contrary to this, the Bank in the order of appointment dated 28-1-1993 stated, that they will only protect the 'basic pay' of the selected candidates. Taking advantage of the words 'basic pay' in the order of appointment dated 28-1-1993, the Bank while fixing the pay scale of petitioners excluded to merge the personal pay with the basic pay. At the first instance the Bank in its notification dated 3-9-1992 assured the petitioners that their present pay will be protected. But in the order of appointment they deviated and only mentioned as basic pay. This situation resulted in fixing the pay of the petitioners at a lower stage than they were drawing. Therefore, the impugned award fixing the pay scale of petitioners by excluding the personal pay is contrary to the notification dated 3-9-1992. On this ground also the impugned order is liable to be quashed. 9. The contention of the leamed Counsel for the Bank that pay does not include personal pay is unacceptable to me. This Court in the case of the Chairman, Dharwad District Government Employees' Co-operative Bank Limited, held as under: "7. The word "pay" has been explained to mean "the average monthly salary drawn during the last year of the employee's active service". This Court in the case of the Chairman, Dharwad District Government Employees' Co-operative Bank Limited, held as under: "7. The word "pay" has been explained to mean "the average monthly salary drawn during the last year of the employee's active service". If the word "pay" has to be understood with a limited meaning as being only basic wage, the above explanation perhaps would become unnecessary because, the basic wage of an employee in any year ordinarily remains the same in the pay scale admissible to his post with the annual increment. When the rule refers to "average monthly salary" it should be inclusive of the allowances which may be varying depending upon the different allowances granted to the employee. This is also the scheme of payment of gratuity provided under the Payment of Gratuity Act, 1972, whereunder the word "wage" has been defined to mean "all emoluments which are earned by an employee while on duty including dearness allowance". 10. The Subsidiary Rules of the second respondent-Bank defines the word 'pay' to mean 'monthly substantive pay'. The words 'personal pay' means 'additional pay granted to an employee to save himself from loss of substantive pay in respect of a permanent post due to a revision of pay of to any reduction of such substantive pay otherwise than a disciplinary measure' or 'in exceptional circumstances on other personal consideration'. 'Substantive pay' means, 'pay other than personal payor other allowances sanctioned for the specific purposes to which the employee is entitled on account of a post to which he has been appointed substantially or by reasons of his substantive position in a cadre. 11. A harmonious reading of the words 'pay', 'personal pay' and 'substantive pay' makes it clear that the average monthly salary of an employee is the monthly pay. When the petitioners entered the service their pay scale was in two stages, that is, initial pay and ending with a ceiling pay. By virtue of increments and revision of pay scale the petitioners pay exceeded the ceiling limit. In that event, in order to save the loss to the petitioners the substantive pay in excess of ceiling limit was treated as personal pay. Therefore the personal pay is a part of substantive pay. The Bank shall merge both pay and personal pay while fixing the pay scale of petitioners as Law Officers. In that event, in order to save the loss to the petitioners the substantive pay in excess of ceiling limit was treated as personal pay. Therefore the personal pay is a part of substantive pay. The Bank shall merge both pay and personal pay while fixing the pay scale of petitioners as Law Officers. There is no justification for the Bank to exclude the personal pay while fixing the pay scale of petitioners as Law Officers. 12. The reasoning of the first respondent in the impugned award and in the order of the Tribunal is based on the presumption that the petitioners are seeking personal pay in addition to the basic pay as Law Officers is unfounded and factually incorrect. It is the specific case of the petitioners that their basis pay is to be merged with personal pay at the time of fixing of their pay scale is Law Officers. Petitioners are not seeking personal pay in addition to basic pay. Therefore, the entire approach of the first respondent and the Tribunal is baseless and unfounded. 13. For the reasons stated above, the following.-. ORDER I. Writ petition is allowed. II. The impugned award dated 21- 7 -1999 in dispute No DDS/D2/1110/97-98 passed by the first respondent and the order dated 27-4-2001 in Appeal No. 506 of 1999 passed by the Karnataka Appellate Tribunal are hereby quashed; III. The second respondent is directed to fix the pay scale of petitioners in the higher post of Law Officers by merging the basic pay and personal pay drawn by the petitioners before their recruitment as Law Officers and to extend all consequential benefits to the petitioners; IV. Ordered accordingly with no order as to costs.