Case BriefsHigh Courts

Kerala High Court: In a significant relief to non-NLU law graduates seeking job opportunities in PSUs, V.G. Arun, J., declared that NTPC’s notification for the recruitment of Assistant Law Officers is discriminatory and violates Article 16 of the Constitution for confining the selection process only to CLAT PG-2021 candidates.  

The Court expressed,  

“There is no logical basis for the assumption that professionalism and competence is the fiefdom of only those passing from elite institutions. The process now adopted is more like a walkover to the finals for a chosen few, without competing in the preliminaries.”

Factual Backdrop and Interim Order 

The petitioner, a Law Graduate, had approached the Court to challenge the notification published by National Thermal Power Corpn. Ltd. (NTPC) inviting applications for appointment to the post of Assistant Law Officer. As per the notification, the selection is confined to only those candidates who have appeared for CLAT-2021 (Common Law Admission Test-2021) Post Graduate programme conducted by the Consortium of National Law Universities. Based on their performance in the test, the candidates would be shortlisted for document verification. 

The petitioner being a law graduate with the requisite minimum marks was desirous of applying for the notified vacancy, but was prevented from doing so, as she had not appeared for the CLAT-2021 PG programme. Therefore, she had assailed the selection process on the ground that it is discriminatory and violates Article 16 of the Constitution. 

Finding prima facile merit in the challenge, the Court had passed an interim order, directing the NTPC to accept the petitioner’s application, subject to the final outcome of the writ petition. 

 

Grounds for Challenge  

The petitioner had assailed the notification on the following grounds:  

  • Imposing a precondition that the candidates should have appeared for CLAT 2021 PG programme and making selection on the basis of marks secured in CLAT 2021, militates against the fundamental right to equality of opportunity in public employment guaranteed under Article 16 of the Constitution.  
  • The fees in NLUs being much higher than in other Law Colleges, including the fee for participation in entrance exam, i.e., CLAT PG being much higher than the fee for admission tests for other law colleges, the notification discriminates between those having the financial capacity for pursuing their higher studies in National Law Universities and others, who opt to join law colleges with lesser fees. 
  • By the offensive clause, the zone of eligible applicants is reduced to a small fraction, from among the multitude of law graduates aspiring for public employment. 
  • The clause has no rational nexus with the objective sought to be achieved, viz; selection of the most competent from among the law graduates. 

 

Analysis and Findings 

The NTPC argued that employers enjoy a prerogative in fixing eligibility criteria and there is limited scope for judicial interference. Rejecting the aforementioned argument, the Court opined that the prerogative exists unless the act of the employer is found to be arbitrary, unreasonable or having no rational nexus to the objective sought to be achieved. The Court noted that in the case at hand the challenge was not against qualification or eligibility, but focused on the selection process. The challenge was mainly on the ground that, incorporation of the restrictive selection criteria was nothing but indirect discrimination as recognised in Nitisha v. Union of India, (2021) SCC OnLine SC 261 

Similarly, rejecting the NTPC’s argument that it is inexpedient to conduct selection test across India for filling up ten posts, the Court held that such argument was antithesis to Article 16 of the Constitution; since as long as the Constitution guarantees equality of opportunity to the citizens, the State and its instrumentalities have a corresponding duty to ensure such opportunity to all. 

 

The Court noted that out of the 1721 law colleges in India, only 23 are members of the Consortium of National Law Universities. Another crucial aspect, making the selection process plagued by indirect discrimination is that consideration for selection is confined to candidates who had appeared for CLAT-2021 PG programme alone and even candidates who had appeared for the previous year’s CLAT PG programme and performed well are kept out of the zone of consideration. 

“The process now adopted is more like a walkover to the finals for a chosen few, without competing in the preliminaries.” 

 

Noticing that the selection is based on a test conducted much prior to the issuance of impugned notification, the Court opined that law graduates aspiring for appointment in public sector undertakings cannot be expected to appear for an admission test, hoping that in future that test will be made the criterion for selection and appointment to PSUs.  

 

Lastly, the Court observed that the focus of the test is on academics and not an assessment of the skill set expected of future Law Officers which makes the selection process devoid of any rational nexus with the objective.  

 

Conclusion  

In the backdrop of above, the Court concluded that the impugned notification, insofar as it confines the selection process to only candidates who had participated in the CLAT-2021 PG programme, violated Article 16 of the Constitution.  

However, rather than upsetting the whole selection process, the Court had directed the NTPC to accept the petitioner’s application and conduct a selection test or interview for testing her eligibility for appointment to the notified post. The Court directed that further action with respect to the appointment shall be taken depending on the outcome of such selection test/interview. 

[Aishwarya Mohan v. Union of India, 2022 SCC OnLine Ker 3090, decided on 06-06-2022]  


Appearance by: 

For the Petitioner: Advocate Maitreyi S.Hegde  

For Union of India: SGI Tushar Mehta assisted by Advocate Adarsh Tripathi, ASG S.Manu and Advocate N.S. Daya Sindhu Shree Hari 


*Kamini Sharma, Editorial Assistant has reported this brief.

 

Case BriefsSupreme Court

Supreme Court: The Division Bench of M.R. Shah* and A.S. Bopanna, JJ., held that to allot plots to a few ex-employees to avoid undue hardship as a welfare measure and as a rehabilitation, and excluding others similarly placed ex-employees is discriminatory and violative of Right to Equality.

Factual Matrix

The Azam Jahi Mills, owned and run by the National Textile Corporation Ltd. (NTC) had about 452 employees who worked there for more than 20 years till the said Mill was closed in the year 2002.

During the period of service, all the workers were allotted Employees’ Quarters. As all the employees took voluntary retirement pursuant to a Modified Voluntary Scheme of 2002, the Mill had asked them to vacate the quarters stating that the quarters were in dilapidated condition and became unfit for human habitation. Approximately 318 employees including the members of the Workers Association were forcefully evicted from the quarters, however, some of the employees who were about 134 in number, continued to stay in their respective quarters despite service of the notice asking them to vacate the quarters.

Meanwhile, the Mill submitted application for closer, during the hearing a request was made on behalf of the representatives of the Union to allot quarters to the concerned workmen at reasonable rates. As a portion of the land owned by the Mill was sold to Housing Board, Kakatiya Urban Development Authority (KUDA), KUDA submitted a proposal to the State to allot free of cost house sites of 200 Sq. Yards each to 134 employees of the Mill, who continued to stay in their respective quarters as a rehabilitation and welfare measure; which was accepted by the State.

Findings of the High Court

It was in the above backdrop that 318 retired workers who also took voluntary retirement along with other 134 workers made representation to allot to them 200 Sq. Yards plot as allotted to other 134 workers. Since no action was taken by the authorities concerned the Association representing 318 employees approached the High Court of Telangana for relief. The Single Judge allowed the said petition and directed the respondents to allot house sites of 200 Sq. Yards each to all the eligible 318 members of the Workers Association by observing that they were at par with other 134 ex-employees of the Mill, who were already allotted house sits of an extent of 200 Sq. Yards. However, the said order was quashed by the Division Bench.

Intelligible differentia

Noticeably, 318 ex-employees who were not allotted the 200 Sq. Yards of plots and 134 ex-employees who were allotted 200 Sq. Yards of plots free of cost were similarly situated and as such there was no difference between them at all. On the contrary, 318 ex-employees could be said to be law abiding ex-employees who vacated the quarters pursuant to the notice.

Therefore, holding that 134 ex-employees who were allotted 200 Sq. Yards of plots free of cost were in unauthorized occupation of the quarters and they did not vacate the quarters despite the notice and even after 31-08-2002 when they accepted the voluntary retirement and relieved, the Bench opined that to allot the plots to those employees who were found to be in unauthorized occupation would tantamount to giving a premium to their illegality and remaining in occupation and possession of the quarters illegally and unauthorizedly.

Legal Nexuses

Initially, the reason for allotting house to 134 employees, as stated by the respondent was to avoid undue hardship to the ex-employees and as a welfare measure. However, later on the respondent contended that the decision of allotting plots free of cost was taken to any litigation and/or litigation cost. Therefore, the Bench opined that the respondents could not be permitted to improve their case which was not even their case earlier viz. at the time when they made a proposal to permit them to allot 200 Sq. Yards of plots free of cost to 134 ex-employees

Hence, the Bench held that there was no rationale justification in providing differential treatment to one class of ex-employees similarly placed with another class of ex-employees who were allotted plots. Therefore, the Bench stated, to allot 200 Sq. Yards of plots to 134 ex-employees to avoid undue hardship to the ex-employees and as a welfare measure and as a rehabilitation to only 134 case ex-employees and not other ex-employees similarly situated, would be discriminatory and violative of Article 14 of the Constitution.

Conclusion

In view of the above, the appeals were allowed and the impugned judgment and order of the Division Bench were quashed and set aside. The Judgment of the Single Judge was restored and the respondents were directed to treat and consider the remaining 318 ex-employees at par with other 134 ex-employees who were allotted 200 Sq. Yards of plots free of cost.

Additionally, the Bench held that the respondent would be at liberty to approach the State government for allotment of additional land and/or to allot the plots which might be vacant and available with the Central Government/NTC as the case may be. [Azam Jahi Mill Workers Association v. National Textile Corporation Limited, 2021 SCC OnLine SC 972, decided on 26-10-2021]


Kamini Sharma, Editorial Assistant has put this report together 


Appearance by:

For the Appellant: Nitya Ramakrishnan, Senior Advocate

For KUDA: V. Giri, Senior Advocate

For NTC and Union of India: Aishwarya Bhati, ASG


*Judgment by: Justice M. R. Shah     

Know Thy Judge | Justice M. R. Shah

Case BriefsSupreme Court

Supreme Court: The Division Bench comprising of Dr. Dhananjaya Y Chandrachud* and B V Nagarathna, JJ., partly allowed the petition challenging Union Government’s disinvestment of its shareholding in Hindustan Zinc Ltd. (HZL). The Bench, though held that the government was within its powers to disinvest its shares, it was of the opinion that a full-fledged CBI enquiry was required regarding previous disinvestment by the government. The Bench stated,

“There is no bar on the constitutional power of this Court to direct the CBI to register a regular case, in spite of its decision to close a preliminary enquiry.”

HZL was incorporated as a public sector company to develop the mining and smelting capacities, so as to substantially fulfil the domestic demand for zinc and lead. In 1991-92, the Union Government disinvested 24.08 per cent of its shareholding in HZL and again in 2002 it disinvested 26 per cent of its shareholding in HZL to a ‘strategic partner, Sterlite Opportunities & Ventures Ltd. (SOVL). Consequently, the Union Government was left with an equity holding of 49.92 per cent.

Res Judicata and PILs

While determining the issue that the first relief sought by the petitioners, i.e. residual disinvestment can occur only after the amendment of the Nationalisation Act 1976 was  substantially similar to the reliefs sought by Maton Mines Mazdoor Sangh when the disinvestment of 2002 and 2014, the Bench opined that the Court must be alive to the contemporary reality of “ambush Public Interest Litigations” and interpret the principles of res judicata or constructive res judicata in a manner which does not debar access to justice. The Bench expressed,

“While determining the applicability of the principle of res judicata under Section 11 of the Code of Civil Procedure 1908, the Court must be conscious that grave issues of public interest are not lost in the woods merely because a petition was initially filed and dismissed, without a substantial adjudication on merits.”

Considering that the three judges Bench had rejected the petition filed by Maton Mines Mazdoor Singh in limine, without a substantive adjudication on the merits of their claim, the Bench held that the instant petition was not barred by res judicata.

Whether disinvestment was barred by the Nationalisation Act 1976?

Relying on the object of the Nationalisation Act, 1976 which was to acquire control over the strategic mineral deposits of lead and zinc, since zinc plays important role in the country’s economy, the petitioners contended that disinvestment could not be made without amending the Nationalisation Act 1976. Assailing the contention of the petitioners, the Union Government made following submissions:

  1. After 16 March 1999, the mining of zinc has ceased to retain a strategic character, given the changes in industrial policy.
  2. There was no challenge to the disinvestment which took place in 1991-92 or in 2002.
  3. The HZL had ceased to retain its status as a government company within the meaning of Section 617 of the Companies Act 1956.

In view of the above, the Bench opined that it would be inconsistent to read an implied limitation on the transfer by the Union Government of its residual shareholding in HZL representing 29.54 per cent of the equity capital. Considering that HZL was not a government company, the Bench stated, when a decision has been taken by the government as a shareholder of a company to sell its shares, it acts as any other shareholder in a company who makes the decision on the basis of financial and economic exigencies.

Whether the decision in Centre for Public Interest Litigation would result in a bar on the disinvestment of the residual shareholding?

In Centre for Public Interest Litigation v. Union of India, (2003) 7 SCC 532, the Court had held that that the divestment of the shareholding of the Union Government in HPCL and BPCL, as a result of which the companies would cease to be government companies, could not be undertaken without amending the statutes under which they were nationalized. Distinguishing the decision in Centre for Public Interest Litigation, the Bench stated that HPCL and BPCL were government companies when the disinvestment action was challenged while HZL ceased to be a government company as a consequence of the disinvestment in 2002, since its shareholding fell below 51 per cent. The Bench opined,

“The fact that the Union Government is amenable to the norms set out in Part III of the Constitution would not impose a restraint on its capacity to decide, as a shareholder, to disinvest its shareholding, so long as the process of disinvestment is transparent and the Union Government is following a process which comports with law and results in the best price being realized for its shareholding.”

Hence, the Bench held that the decision of the Union Government, as an incident of its policy of disinvestment, to sell its shares in the open market, could not be questioned by reading a bar on its powers to do so, from the provisions of the Nationalisation Act 1976.

CBI’s preliminary enquiry

Evidently, in spite of conflicting opinion of the Director of CBI and the Director of Prosecution, CBI regarding the closure of the preliminary enquiry and conversion of it into a regular case; and the fact that the matter was referred to the Attorney General but the Court was not apprised of the status of referral, the preliminary enquiry was closed.

Upon perusal of reports and recommendations in favour of registration of a regular case, which indicated irregularities in the decision to disinvest 26 per cent, instead of 25 per cent, in the bidding process and the valuation of 26 per cent equity for disinvestment, the Bench opined that the disinvestment in 2002 evinced a prime facie case for registration of a regular case. The Bench stated,

“We are desisting from commenting on some crucial facts and names of individuals involved, so as to not cause prejudice to the investigation of the matter.”

Accordingly, opining that there was a prima facie case for cognizable offence, as mandated in para 9.1 of the CBI Manual, the Bench held that a full-fledged investigation must be conducted.

Hence, the petition was partially allowed. The CBI was directed to register a regular case and periodically submit status reports of its investigation to the Court.

[National Confederation of Officers Association of Central Public Sector Enterprises v. Union of India, 2021 SCC OnLine SC 1086, decided on 18-11-2021]


Kamini Sharma, Editorial Assistant has put this report together 


Appearance by:

For the Petitioners: Prashant Bhushan, Senior Counsel

For Union of India: Tushar Mehta, Solicitor General

For Sterlite Opportunities & Ventures Ltd. (SOVL): Harish Salve, Senior Counsel


*Judgment by: Justice Dhananjaya Y Chandrachud

Know Thy Judge| Justice Dr. DY Chandrachud

Case BriefsSupreme Court

Supreme Court: The Division Bench of M.R. Shah and A.S. Bopanna*, JJ., condoned the non pensionable sandwiched period between pensionable services rendered in Central and State government for the purpose of providing a single bock of pensionable service.

The appellant worked as a Technician in the Telecom Department during the period 05-02-1974 to 31-05-1984. Later on, the appellant joined the Technical Education Department on 31-05-1987, where he served till 30-06-2006 and got retired on attaining the age of superannuation. During the period between those services the appellant had worked in Steel Industries Limited, Kerala (SILK), a Public Sector Undertaking.

The appellant had requested the State to condone the period served by him in PSU and consider the services rendered by him under the Telecom Department and Education Department as one for granting pension which was rejected by the State. On application the Kerala Administrative Tribunal allowed benefit of pension to the appellant by condoning the period of break in service, as being permissible in the circumstance. However, the same was set aside by the High Court by the impugned judgment.

Admittedly, the service rendered by the appellant in ‘SILK’ which was a PSU was not pensionable service. Therefore, the said period of service acted as a disconnect between the two different pensionable service and the same needed to be condoned to provide a single block of pensionable service.

The case of the appellant was not that the non­ pensionable service be reckoned and the entire service from 05-02-1974 to 30-06-2006 be admitted for computing the pensionary benefits as assumed by the High Court.

Rather what the appellant sought was to exclude the service rendered in ‘SILK’ and condone that period from being treated as a disjoint or break between the two pensionable services.

The appellant had relied on a Government Order dated 12-11-2002 by which the government had declared that the employees of the State Government Departments who had left the former service in Central Government/ Central Public Sector Undertakings on their own volition for taking up appointment in State government Departments will be allowed to reckon their prior service for all pensionary benefits along with the service in the State Government Department.

Similarly, the Government Order dated 24-09-2014 the government had provided for condonation of the non­qualifying sandwiched period to reckon the qualifying service.

After perusing the referred Government Orders, the Bench opined that the benefit sought for by the appellant was provided and the sandwiched non qualifying service as break in the two services was condonable and the prior public service should be reckoned as qualifying service for pension.

Rejecting the State’s contention that the appellant had retired on 30-06-2006, while the Government Order was dated 24-09-2014 and as such could not be made applicable retrospectively, the Bench stated the issue had not been settled and not reached finality in the case of the appellant since his review petition dated 17-09-2014 was still pending when the Government Order was issued. Moreover, the said Government Order in para 2 had taken note of the several requests received to reckon the prior qualifying service.

In the backdrop of above, the Bench was of the opinion that the Tribunal was justified in its conclusion and the High Court had erred in setting aside the same. Accordingly, the impugned order was set aside and the order of the Tribunal was restored for its implementation.

[Valsan P. v. State of Kerala, 2021 SCC OnLine SC 953, decided on 21-10-2021]


Kamini Sharma, Editorial Assistant has put this report together 


Appearance by:

For the Appellant: P.V. Surendranath, Senior Counsel

For the Respondent: C.K. Sasi


*Judgment by: Justice A.S. Bopanna