He was speaking after paying tributes at the Amar Jawan Jyoti here on Vijay Diwas or Victory Day that is observed on December 16 to mark the military triumph over Pakistan in 1971 which led to the creation of Bangladesh.
The Defence Minister, however, did not give a timeline for naming the new chiefs.
Asked whether the line of succession might be broken in the appointment of the next army chief, Parrikar said cryptically: "Line of succession is decided by the people."
The Indian Army chief, General Dalbir Singh, and the Indian Air Force Chief, Air Chief Marshal Arup Raha, are both set to retire on December 31.
A file with nominations for the new chiefs is with the Prime Minister's Office, and a formal announcement is expected after parliament's winter session concludes on Friday, sources said.
The sources also added that the Eastern Army Commander, Lt. Gen. Praveen Bakshi; the Southern Army Commander, Lt. Gen. P.M. Hariz and the army vice chief, Lt Gen Bipin Rawat are in the fray to succeed Gen. Dalbir Singh.
Air Marshal Birender Singh Dhanoa, a Kargil war veteran, and the IAF vice chief is in the fray for the top job.
Talking about the significance of December 16, Parrikar said it was a day when India achieved a "decisive victory".
"I don't have to stress on the importance of this great day. This is the day when we achieved a decisive victory and created a new country," he said.
On the next canisterised test for Agni V missile, the minister said he would not like to comment much on it and said: "Testing goes on, I will not comment much. We have achieved 100 percent success in all the tests this year."