It added that the executive, by the Constitution, has been conferred the right to choose as it has a duty to discharge, and is responsible and accountable for their action.
The Supreme Court on Monday said the Modified Assured Career Progression (MACP) scheme in the armed forces is a well-considered decision taken by the government.
A bench of Justices Sanjiv Khanna and Bela M. Trivedi said: "The MACP Scheme is not irrational, unjust and prejudicial to a section of the employees, but a well-considered decision which has taken all material and relevant factors into consideration."
It ruled that "MACP Scheme is applicable with effect from September 1, 2008, and as per the MACP Scheme, the entitlement is to financial upgradation equivalent to the immediate next grade pay in the hierarchy of the pay bands as stated in Section 1, Part A of the First Schedule to the Central Civil Services (Revised Pay) Rules, 2008".
The bench said courts would not normally interfere with well-deliberated decisions by experts in the field, unless adoption is bad on account of statutory violation, the policy contravenes the overriding constitutional mandate of right to equality, is discriminatory, manifestly arbitrary or negates other fundamental rights.
It added that the executive, by the Constitution, has been conferred the right to choose as it has a duty to discharge, and is responsible and accountable for their action. The court examines the validity challenge, albeit, while performing the constitutional duty and exercising the power of judicial review, does not substitute its views on the choice of policy on merit, said the bench.
The top court said: "In fiscal matters, including pay fixation and terms of service, several factors like prevailing financial position, capacity to bear the additional liability are relevant and, therefore, the courts do tread carefully as interference may have serious impact on the public exchequer and have grave financial implications."
"Prescription of pay scales and incentives are a matter of decision taken by the government which, when based upon the recommendation of an expert body like the Central Pay Commission, should carry weight and the courts should be reluctant to substitute the policy with their own views on what would be more equitable and just."
Under the scheme, on completion of 10, 20, and 30 years of regular service, an employee is entitled to financial upgradation to the next higher grade pay and grade pay as given in Section 1, Part A of the First Schedule of the Central Civil Services (Revised Pay) Rules, 2008.
The bench added: "It is to be noted that the MACP Scheme postulates grant of three financial upgradations after a period of 10, 20 and 30 years, whereas the ACP Scheme had postulated grant of only two financial upgradations after a period of 12 and 24 years of regular service."
The top court also set aside the verdicts, which held MACP Scheme is applicable from January 1, 2006, and the employees, under the scheme, are entitled to financial upgradation equivalent to the next promotional post.