The Supreme Court has held that the Railways is not bound by the memorandum issued by the Department of Personnel and Training (DoPT) and are empowered to frame its own rules to lay down the service conditions of its employees.
The said ratio was held in the matter of Prabhat Ranjan Singh vs. R.K. Kushwaha [Civil Appeal No. 9176 of 2018], decided on 07.09.2018.
Whether the Railways is bound by the rules framed by the DoPT or it can frame its own rules and whether the IREM (Indian Railways Establishment Manual) has statutory force
The Apex Court while referring to Allocation of Business Rules, 1961, said that the Railways are specifically excluded from the ambit of the scope of business allocated to the DoPT, whether it be for classification of posts, recruitment of ministerial staff, appointment of non-Indians to civil posts, fixing of service conditions, including conduct rules, general policy regarding retrenchment and revision of temporary service of the Railways etc., and as such the DoPT cannot issue binding circulars upon the Railways.
The court also observed that Allocation of Business Rules, 1961, while allocating business to the Ministry of Railways, has vested power to it to deal with all matters, including those relating to revenue and expenditure, and, therefore, the Ministry of Railways has the power to lay down conditions of service for its employees holding that the Indian Railways Establishment Manual (IREM) has statutory force and the same has been issued in exercise of powers vested under the proviso to Article 309 of the Constitution.