Service Law Archives

Supreme Court holds private school teachers entitled to gratuity; upholds Constitutional validity of Payment of Gratuity (Amendment) Act, 2009

Supreme Court: While upholding the Constitutional validity of the Payment of Gratuity (Amendment) Act, 2009, the Division Bench of Sanjiv Khanna* and Bela M. Trivedi, JJ., held that the Amendment seeks to bring equality and give fair treatment to the teachers. It can hardly be categorised as an arbitrary and high-handed exercise.

Noticeably, the aforesaid Amendment Act was introduced to extend the benefit of gratuity to the teachers by including them in the definition of “employee”, who were earlier deprived of it. The Court said,

“Private schools, when they claim a vested right arising from the reason of defect, should not succeed, for acceptance would be at the expense of teachers who were denied and deprived of the intended benefit.”

The common question before the Bench was regarding constitutional validity of the amendment to Section 2(e) and insertion of Section 13A to the Payment of Gratuity Act, 1972 (the Act), with retrospective effect from 03-04-1997 vide the Payment of Gratuity (Amendment) Act, 2009.

Government Notification No. S-42013/1/95-SS.(II)

The Act requires payment of gratuity to an employee after he has rendered continuous service for not less than 5 years, on his superannuation, retirement or resignation or on his death or disablement due to accident or disease. Noticeably, by the Notification No. S-42013/1/95-SS.(II) issued by the Ministry of Labour and Employment, Government of India on 03-04-1997, the provisions of the Act have been made applicable to the educational institutions with ten or more employees.

**Decision in Ahmedabad Private Primary Teachers’ Association’s case,** (2004) 1 SCC 755

Therefore, the private schools being educational institutions, in which ten or more persons are employed, became liable to pay gratuity to their employees as per the provisions of the Act. However, some private schools raised a dispute claiming that the teachers in educational institutions or schools are not “employee” as defined in Section 2(e) of the Act. The Supreme Court in Ahmedabad Private Primary Teachers’ Association v. Administrative Officer, (2004) 1 SCC 755, held that teachers who impart education to students are not “employee” under Section 2(e) of the Act as they do not perform any kind of skilled, unskilled, semi-skilled, manual, supervisory, managerial, administrative, technical or clerical work.

Thus, the teachers were denied the benefit of gratuity, but other employees of the private schools, were entitled to the benefit of gratuity.

Payment of Gratuity (Amendment) Act, 2009

Referring the judgment in Ahmedabad Private Primary Teachers’ Association (supra) in the object and reasons for Amendment, the Government introduced the Payment of Gratuity (Amendment) Act, 2009 to cover the definition of “employee” to all kinds of employees. The Amendment Act inserted a new Section 13A and also Clause (e) to Section 2 of the Act with retrospective effect from 03-04-1997 to confer, with retrospective effect, benefit of gratuity to the teachers who have rendered continuous service for not less than 5 years.

Analysis and Findings

Whether the government empowered overrule judicial decisions by introducing Statutory Amendments?

The petitioners contended that the legislation vide the Amendment Act 2009 overrules the judicial decision in Ahmedabad Private Primary Teachers’ Association (supra) and violates the doctrine of separation of powers. Rejecting the aforesaid argument, the Court observed that the legislation in question rather rectifies the infirmities and defects pointed out by the Court in the aforesaid decision, and the amended clause (e) to Section 2, defining the word “employee” and the newly inserted Section 13A with retrospective effect, effectuate and catalyse the object and purpose of the Notification No. S-42013/1/95-SS.(II).

The Court opined that though a court decision cannot be overruled by the legislature, the legislature can amend the language of the provision that was the subject matter of the court decision, and such an amendment does not overrule the court decision. The Court said,

“Overruling assumes a decision based on the same law. Where the law, as in the present case, has been amended, and the defects have been removed or cured, the law changes, and therefore, the earlier interpretation is no longer applicable and becomes irrelevant.”

Noting that the decision in Ahmedabad Private Primary Teachers’ Association (supra) even acknowledged and prompted the legislature to enact a legislation granting the benefit of gratuity to teachers, who had been excluded because of the legal flaw, the Court held that the amendment enforces and gives effect to what was intended by the notification, but could not be achieved on account of the technical and legal defect. The lacuna, a distortion in the language that had the unwitting effect of leaving out teachers, has been rectified so as to achieve the object and purpose behind the issuance of the notification, making the Act applicable to all educational institutions.

Whether the Amendment financially confiscatory?

The private educational institutions also assailed the Amendment on the ground that they would be liable to pay gratuity for a period of service prior to 03-04-1997, and, therefore, the amendments are unconscionable and tyrannous, equally fallacious and financially confiscatory. The Court, calling the aforesaid argument fallacious, observed that the argument, predicated on past liability, deserved to be rejected as there are upper-cap limits on payment of gratuity; i.e., the payment towards gratuity cannot exceed the specified amount, even if the employee would be entitled to higher amount in view of the years of the service rendered to the employer.

Relying on T.M.A. Pai Foundation v. State of Karnataka, (2002) 8 SCC 481, some schools argued that charging of capitation fee or profiteering by educational institutions is impermissible and they do not have capacity and ability to pay gratuity to the teachers.

Finding the aforesaid argument unapt and parsimonious, the Court clarified the decision in T.M.A. Pai Foundation (supra) by holding that the judgment does not state that the teachers should not be paid gratuity; in fact, the judgment holds that the educational institutions are entitled to reasonable surplus to meet the cost of expansion and augmentation of the facilities and this does not amount to profiteering.

The Court noted that though it is possible that in some States there are fee fixation laws which will have to be complied with, but compliance with these laws does not mean that the teachers should be deprived and denied gratuity, which they were/are entitled to receive as other employees of an educational institution. The Court said that regulation of fee is to ensure that there is no commercialisation and profiteering, and the effect is not to prohibit a school from fixing and collecting ‘just and permissible school fee’. The Court added,

“We would not accept any attempt to circumscribe and limit the power vested with the sovereign legislature, thereby putting fetters when such fetters are not prescribed by the Constitution. When and which cases to exercise the power has to be left to the legislature.”

Applicability: Retrospective v. Retroactive

The Court, while holding that the Amendment retroactive, observed that the provisions of the Act, even post the retrospective amendments, will apply only to those teachers who were in service as on 03-04-1997, and at the time of termination have rendered service of not less than 5 years. The Court said that the period of 5 years may be partly before 03-04-1997, as the date on which the person was employed does not determine the applicability of the PAG Act.

However, the date of termination of service, should be post the enforcement date. The entire length of service, including the service period prior to 03-04-1997, is to be counted for the purpose of computing the entitlement condition of 5 years of service.

Whether the Amendment violative of Fundamental Rights?

The schools had claimed violation of Articles 14, 19(1)(g), 21 and 300-A of the Constitution. Holding that the Constitutional provisions are not violated, the Court said that to deny gratuity benefits to the teachers upon enforcement of the notification No. S-42013/1/95-SS.(II) was itself an anomaly which mandated correction.

The Court observed that the teachers were discriminated to be denied benefit of gratuity, a terminal benefit, which was payable to other employees of the private schools/educational institutions, including those engaged in administrative and managerial work. The amendment with retrospective effect remedies the injustice and discrimination suffered by the teachers on account of a legislative mistake.

Whether the Amendment violated other enactments?

The last contention raised by the private schools and writ petitioners was predicated on the enactment of the Repealing and Amending Act 2016, by virtue of which the Amendment Act 2009 was repealed. Once again, rejecting such contention, the Court opined that the argument overlooked Section 6A of the General Clauses Act, 1897 and Section 4 of the Repealing and Amendment Act, which states that the repeal shall not affect any of the enactment in which the repealed enactment has been applied, incorporated or referred to. It also states that the Repealing Act shall not affect the validity, invalidity, effect or consequences of anything already done or suffered, or any right, title, obligation or liability already acquired, accrued or incurred etc.

Verdict

In the light of aforesaid, the Court upheld the validity of the Amendment Act and directed that the private schools would make payment to the employees/teachers along with the interest in accordance with the provisions of the Act within a period of 6 weeks and in case of default, the employees/teachers may move the appropriate forum to enforce payment in accordance with the provisions of the Act.

Hence, the Court vacated the partial stay on the Amendment Act in the order dated 31-01-2020 passed in Saint Xaviers High School v. Jayashree Shamal Ghosh, (SLP (C) No. 2235 of 2020) or in any other case. The appeals and the petition were dismissed.

[Independent Schools’ Federation of India (Regd.) v. Union of India, 2022 SCC OnLine SC 1113, decided on 29-08-2022]

*Judgment by: Justice Sanjiv Khanna

Kamini Sharma, Editorial Assistant has put this report together

Case Briefs Supreme Court

Make way for the outsiders: Compassionate Appointment cannot be extended to heirs of the retiring employees, holds Supreme Court

Supreme Court: In a case where the Ahmednagar Mahanagar Palika/ Municipal Corporation was giving appointment to the heirs of the employees on their superannuation and/or retirement, the bench of MR Shah* and BV Nagarathna, JJ has held that such appointment is contrary to the object and purpose of appointment on compassionate grounds and is hit by Article 14 of the Constitution of India.

In 2003, Ahmednagar Municipal Council was converted to Ahmednagar Mahanagar Palika. In 1979, when the Municipal Council was in existence, an industrial dispute was raised by the Union with respect to the employment to be given to the heirs of the employees. At the relevant time, it was agreed by the Municipal Council that the employees in Class-IV category (if they die before their retirement) in all departments, except Health Department, if they become invalid, or if they retire, their heirs will be given appointment in their place. Consequently, by judgment and award dated 30.03.1981, the Industrial Court directed that the employees in Class-IV category, if they die before their retirement; if they become invalid, or if they retire, their heirs should be given appointment in their place.

The Supreme Court was of the opinion that,

firstly, the judgment and award of the Industrial Court was passed in the year 1981, when the Municipal Council was in existence.
secondly, once the Municipal Council was converted to Municipal Corporation/Mahanagar Palika, all the employees under Mahanagar Palika/Municipal Corporation came to be governed by the scheme/rules & regulations framed by the State Government, which does not provide for any appointment on compassionate grounds or the appointment to the heirs of the employees on their superannuation/retirement.

Even otherwise, explaining the scope of compassionate appointment, the Court said that it shall always be treated as an exception to the normal method of recruitment. The appointment on compassionate grounds is provided upon the death of an employee in harness without any kind of security whatsoever. The appointment on compassionate grounds is not automatic and shall be subject to the strict scrutiny of various parameters including the financial position of the family, the economic dependence of the family upon the deceased employee and the avocation of the other members of the family. No one can claim to have a vested right for appointment on compassionate grounds. Therefore,

“appointment on compassionate grounds cannot be extended to the heirs of the employees on their superannuation and/or retirement. If such an appointment is permitted, in that case, outsiders shall never get an appointment and only the heirs of the employees on their superannuation and/or retirement shall get an appointment and those who are the outsiders shall never get an opportunity to get an appointment though they may be more meritorious and/or well educated and/or more qualified.”

Hence, both the Judgment and award passed by the Industrial Court as well as the Bombay High Court in directing the Mahanagar Palika/Municipal Corporation to give appointment to the heirs of the employees on their superannuation and/or retirement, have been held to be unsustainable and hence, quashed and set aside.

[Ahmednagar Mahanagar Palika v. Ahmednagar Mahanagar Palika Kamgar Union, 2022 SCC OnLine SC 1154, decided on 05.09.2022]

*Judgment by: Justice MR Shah

For Municipal Corporation: Advocate Suhas Kadam

For Union: Advocate Iyer Shruti Gopal

Case Briefs Supreme Court

“Family” includes domestic, unmarried/queer relationships; Child care/maternity leave benefits cannot be denied if women do not fit into “popular imagination” of a family: SC

Supreme Court: In a case relating to maternity leave benefit to a woman not fitting in the popular imagination of a family, the bench of Dr DY Chandrachud* and AS Bopanna, JJ has observed that “familial relationships may take the form of domestic, unmarried partnerships or queer relationships.”

The Court was of the opinion that the predominant understanding of the concept of a “family” both in the law and in society is that it consists of a single, unchanging unit with a mother and a father (who remain constant over time) and their children, ignores the fact that many circumstances lead to a change in one’s familial structure, and that many families do not conform to this expectation to begin with.

“A household may be a single parent household for any number of reasons, including the death of a spouse, separation, or divorce. Similarly, the guardians and caretakers (who traditionally occupy the roles of the “mother” and the “father”) of children may change with remarriage, adoption, or fostering. These manifestations of love and of families may not be typical but they are as real as their traditional counterparts. Such atypical manifestations of the family unit are equally deserving not only of protection under law but also of the benefits available under social welfare legislation. The black letter of the law must not be relied upon to disadvantage families which are different from traditional ones. The same undoubtedly holds true for women who take on the role of motherhood in ways that may not find a place in the popular imagination.”

Background

The Court was hearing the case where the maternity leave request of a woman, working as Nursing Officer in the Post Graduate Institute of Medical Education and Research Chandigarh, was rejected on the ground that she had two surviving children born from the first marriage of her spouse and had availed of child care leave earlier for one of them, and hence, her first biological child was her third child. The first wife of the appellant’s husband had died, with whom he had two children.

The maternity leave for the child borne by her, considered as her third child, was found to be inadmissible in terms in terms of Rule 43 of the Central Civil Services (Leave) Rules 1972. Hence, her leave was cumulatively treated as earned leave, medical leave, half pay leave, and extraordinary leave. This decision was upheld by the Punjab and Haryana High Court.

Analysis

The Supreme Court, however, noticed that, in the case at hand, the structure of the appellant’s family changed when she took on a parental role with respect to her spouse’s biological children from his previous marriage. When the appellant applied to PGIMER for maternity leave, PGIMER was faced with facts that the law may not have envisaged or adequately accounted for. When courts are confronted with such situations, they would do well to attempt to give effect to the purpose of the law in question rather than to prevent its application.

It was, hence, observed that unless a purposive interpretation were to be adopted in the present case, the object and intent of the grant of maternity leave would simply be defeated. It was explained that the grant of maternity leave under Rules of 1972 is intended to facilitate the continuance of women in the workplace. It is a harsh reality that but for such provisions, many women would be compelled by social circumstances to give up work on the birth of a child, if they are not granted leave and other facilitative measures.

“No employer can perceive child birth as detracting from the purpose of employment. Child birth has to be construed in the context of employment as a natural incident of life and hence, the provisions for maternity leave must be construed in that perspective.”

On the issue of grant of leave for child care, the Court held that Rule 43(1) of the Rules of 1972 contemplates the grant of maternity leave for a period of 180 days. Independent of the grant of maternity leave, a woman is also entitled to the grant of child care leave for taking care of her two eldest surviving children whether for rearing or for looking after any of their needs, such as education, sickness and the like. Child care leave under Rule 43-C can be availed of not only at the point when the child is born but at any subsequent period as is evident from the illustrative causes which are adverted to in the provisions. Both constitute distinct entitlements.

The Court made amply clear that the fact that the appellant’s spouse had two biological children from his first marriage would not impinge upon the entitlement of the appellant to avail maternity leave for her sole biological child. The fact that she was granted child care leave in respect of the two biological children born to her spouse from an earlier marriage may be a matter on which a compassionate view was taken by the authorities at the relevant time.

The Court went on to show concern over the fact that gendered roles assigned to women and societal expectations mean that women are always pressed upon to take a disproportionate burden of childcare work. According to a ‘time-use’ survey conducted by the Organisation for Economic Co-operation and Development (OECD), women in India currently spend upto 352 minutes per day on unpaid work, 577% more than the time spent by men. Time spent in unpaid work includes childcare. In this context, the support of care work through benefits such as maternity leave, paternity leave, or child care leave (availed by both parents) by the state and other employers is essential. Although certain provisions of the Rules of 1972 have enabled women to enter the paid workforce, women continue to bear the primary responsibility for childcare. Hence, the grant of child care leave to the appellant cannot be used to disentitle her to maternity leave under Rule 43 of the Rules of 1972.

The Court, hence, held that the appellant was entitled to the grant of maternity leave and directed that the benefits to her shall be released to her within a period of two months from the date of the order.

[Deepika Singh v. Central Administrative Services, 2022 SCC OnLine SC 1088, decided on 16.08.2022]

*Judgment by: Justice DR DY Chandrachud

For appellant: Advocate Akshay Verma

For Respondents: Advocate Sudarshan Rajan

Case Briefs Supreme Court

Employees cannot invoke writ jurisdiction against private educational institution for disputes relating to ordinary contract of service: Supreme Court

Supreme Court: The bench of Anirudhha Bose and JB Pardiwala*, JJ has held that while private unaided minority institution might be touching the spheres of public function or performing a public duty, its employees would not have the right to invoke the powers of the High Court conferred by Article 226 in respect of matter relating to service where they are not governed or controlled by the statutory provisions.

The Court wad dealing with the case relating to a private unaided minority educational institution and its disciplinary committee, wherein the Madhya Pradesh High Court had held that a writ petition filed by an employee of a private unaided minority educational institution seeking to challenge his termination from service was maintainable in law.

Issues

(a) Whether a writ petition under Article 226 of the Constitution of India is maintainable against a private unaided minority institution?

(b) Whether a service dispute in the private realm involving a private educational institution and its employee can be adjudicated in a writ petition filed under Article 226 of the Constitution? In other words, even if a body performing public duty is amenable to writ jurisdiction, are all its decisions subject to judicial review or only those decisions which have public element therein can be judicially reviewed under the writ jurisdiction?

Analysis

At the outset, the Supreme Court noticed that CBSE is only a society registered under the Societies Registration Act, 1860 and the school affiliated to it is not a creature of the statute and hence not a statutory body.

As the CBSE itself is not a statutory body nor the regulations framed by it has any statutory force, the mere fact that the Board grants recognition to the institutions on certain terms and conditions itself does not confer any enforceable right on any person as against the Committee of Management.

Thus, where a teacher or non-teaching staff challenges action of Committee of Management that it has violated the terms of contract or the rules of the Affiliation Byelaws, the appropriate remedy of such teacher or employee is to approach the CBSE or to take such other legal remedy available under law. It is open to the CBSE to take appropriate action against the Committee of Management of the institution for withdrawal of recognition in case it finds that the Committee of Management has not performed its duties in accordance with the Affiliation Byelaws.

The Court took note of the ruling in Ramesh Ahluwalia v. State of Punjab, (2012) 12 SCC 331 wherein it was held that a writ petition would be maintainable if a private educational institution discharges public functions, more particularly imparting education. However, even by holding so, the declined to extend any benefits to the teacher as the case involved disputed questions of fact.

The Court observed that merely because a writ petition can be maintained against the private individuals discharging the public duties and/or public functions, the same should not be entertained if the enforcement is sought to be secured under the realm of a private law.

“It would not be safe to say that the moment the private institution is amenable to writ jurisdiction then every dispute concerning the said private institution is amenable to writ jurisdiction. It largely depends upon the nature of the dispute and the enforcement of the right by an individual against such institution. The right which purely originates from a private law cannot be enforced taking aid of the writ jurisdiction irrespective of the fact that such institution is discharging the public duties and/or public functions. The scope of the mandamus is basically limited to an enforcement of the public duty and, therefore, it is an ardent duty of the court to find out whether the nature of the duty comes within the peripheral of the public duty. There must be a public law element in any action.”

Conclusion

An application under Article 226 of the Constitution is maintainable against a person or a body discharging public duties or public functions. The public duty cast may be either statutory or otherwise and where it is otherwise, the body or the person must be shown to owe that duty or obligation to the public involving the public law element. Similarly, for ascertaining the discharge of public function, it must be established that the body or the person was seeking to achieve the same for the collective benefit of the 64 public or a section of it and the authority to do so must be accepted by the public.
Even if it be assumed that an educational institution is imparting public duty, the act complained of must have a direct nexus with the discharge of public duty. It is indisputably a public law action which confers a right upon the aggrieved to invoke the extraordinary writ jurisdiction under Article 226 for a prerogative writ. Wherever Courts have intervened in their exercise of jurisdiction under Article 226, either the service conditions were regulated by the statutory provisions or the employer had the status of “State” within the expansive definition under Article 12 or it was found that the action complained of has public law element.
While a body may be discharging a public function or performing a public duty and thus its actions becoming amenable to judicial review by a Constitutional Court, its employees would not have the right to invoke the powers of the High Court conferred by Article 226 in respect of matter relating to service where they are not governed or controlled by the statutory provisions. An educational institution may fall within the domain of a “public function” or “public duty” be undisputedly open to challenge and scrutiny under Article 226 of the Constitution, however, the actions or decisions taken solely within the confines of an ordinary contract of service, having no statutory force or backing, cannot be recognised as being amenable to challenge under Article 226 of the Constitution. In the absence of the service conditions being controlled or governed by statutory provisions, the matter would remain in the realm of an ordinary contract of service.
Even if it be perceived that imparting education by private unaided the school is a public duty within the expanded expression of the term, an employee of a non-teaching staff engaged by the school for the purpose of its administration or internal management is only an agency created by it. It is only where the removal of an employee of non-teaching staff is regulated by some statutory provisions, its violation by the employer in contravention of law may be interfered by the court. But such interference will be on the ground of breach of law and not on the basis of interference in discharge of public duty.

[St. Mary’s Education Society v. Rajendra Prasad Bhargava, 2022 SCC OnLine SC 1091, decided on 24.08.2022]

*Judgment by: Justice JB Pardiwala

For appellant: Advocate Pai Amit

Case Briefs Supreme Court

Financial crunch a valid ground to fix cut-off date for granting actual benefit of revision of pension/pay; Rule 3(3) of Tripura State Civil Services (Revised Pension) Rules, 2009 constitutional: Supreme Court

Supreme Court: The bench of MR Shah* and BV Nagarathna, JJ has held that the financial crunch/financial constraint due to additional financial burden is a valid ground to fix a cut-off date for the purpose of granting the actual benefit of revision of pension/pay.

The Court was deciding the case relating to the validity of Rule 3(3) of the Tripura State Civil Services (Revised Pension) Rules, 2009 (Pension Rules, 2009), wherein the Tripura High Court had struck down the Rule and had directed to pay the original writ petitioner the arrears of pension for the period from 01.03.2007 to 31.12.2008.

On Government of India’s request to consider adoption and implementation of Revised Pay Structure in UGC System for Teachers in Colleges w.e.f. 01.01.2006 following revision of pay scales of Central Government employees as per 6th Central Pay Commission’s recommendations, the State of Tripura introduced revised pay structure with Band Pay Rs. 15600-39100 and 37400-67000 respectively with appropriate academic Grade Pay and it was specified that arrears would be payable subject to receipt of financial assistance of 80% from Central Government and that all other allowances to be admissible from 01.01.2009. The State’s notification also provided that the pension would be admissible as per Pension Rules for State as amended from time-to-time and the upper ceiling of pension was raised from Rs. 25200 to 38500. The State amended Rule 3(2) of the Pension Rules, 2009 in the year 2010 and the maximum limit of pension was fixed at Rs. 38500.

Rule 3(3) of the Pension Rules, 2009 which has been struck down by the High Court by the impugned judgment and order, is as under:

“3(3) The revised rate of pension within the above limits of minimum and maximum pension shall be computed notionally from 1st January 2006 or, as the case may be, from the date of superannuation/retirement whichever is later. But financial benefit according to this computation will be admissible from 1st January 2009 or from the date of superannuation/retirement whichever is later”

The same was challenged on the ground that there is no reasonable excuse to deny the actual benefit of pension for the period from 01.01.2006 to 31.12.2008 inasmuch as 80% of the financial requirement for implementation was to be borne by the Central Government whereas the State Government was to bear merely 20% of the entire requirement for making payment of the arrears of pension for the said period.

State, on the other hand, submitted that because of heavy financial burden and there being financial constraints, the State is not in a position to bear the heavy burden of additional revised pension and therefore, the State formulated a policy decision to the effect that the revised pension shall be paid from 9 01.01.2006 to 31.12.2008 notionally and actual revision of pension shall be disbursed from 01.01.2009 only.

The High Court refused to accept State’s plea of financial crunch struck down Rule 3(3) of the Pension Rules, 2009 being arbitrary and violative of Article 14 of the Constitution of India.

The Supreme Court, however, was not impressed with the approach of the High Court as it had, without giving any cogent reasons, observed that the foundation i.e., the financial crunch has not satisfied the Court at all.

The Supreme Court noted that when specific statistics were provided by the State before the High Court justifying its policy decision and the financial crunch/financial constraint was pleaded, there was no reason for the High Court to doubt the same.

The Court went on to hold that it was satisfied that a conscious policy decision was taken by the State Government to grant the benefit of revision of pension notionally from 01.01.2006 or from the date of superannuation till 31.12.2008 and to pay/grant the benefit of revision of pension actually from 01.01.2009, which was based on their financial crunch/financial constraint. To come to this conclusion, the Court relied on the decision in State of Punjab v. Amar Nath Goyal, (2005) 6 SCC 754 that financial constraint can be a valid ground for fixation of cut-off date for grant of benefit of increased quantum of death-cum-retirement gratuity.

Holding that the cut-off date has been fixed as 01.01.2009 on a very valid ground i.e., financial constraint, it was held that the High Court manifestly erred in striking down the Rule 3(3) of the Pension Rules, 2009 being arbitrary and violative of Article 14 of the Constitution and the decision was liable to be set aside.

However, noticing that the original writ petitioner has already been paid the arrears from the date of her retirement pursuant to the interim order passed by the Supreme Court, it has been directed that the same shall not be recovered from her.

[State of Tripura v. Anjana Bhattacharjee, 2022 SCC OnLine SC 1071, decided on 24.08.2022]

*Judgment by: Justice MR Shah

For State: Advocate Shuvodeep Roy

Case Briefs High Courts

Himachal Pradesh High Court | Second Wife entitled to family pension only when personal law of deceased employee allows Bigamy

Himachal Pradesh High Court: In a petition related to family pension, Jyotsna Rewal Dua, J has held that the second wife of a deceased employee is not entitled to family pension under the Central Civil Services (Pension) Rules, 1972 unless the personal law of the deceased employee allows more than one subsisting marriage.

Petitioner's claim was that since the deceased employee's wife has died, who was recipient of the family pension and no other claimant qua family pension survives, therefore, now she the second wife of deceased Bhola Ram is entitled to family pension.

The petitioner relied on Rule 54 of CCS Pension Rules which deals with situation where pension is payable to more than one wife and judgement of Madras High Court in C. Sarojini Devi v. Director of Local Fund Audits, WP No.34592 of 2019, dated 23.01.2020, where the Court held that the second wife was held entitled to the family pension.

The Court discussed Rule 54 of Central Civil Services (Pension) Rules Pension Rules, 1972 (CCS Pension Rules) and Government of India decision No. (13) below Rule 54 of CCS Pension Rules in great detail and observed that generally, second wife will not be entitled for family pension as legally wedded wife but one and only condition in which she will be allowed is when more than one marriage is allowed under the deceased employee's personal laws.

The Court also relied on the judgement of the Hon'ble Supreme Court in Raj Kumari v. Krishna, (2015) 14 SCC 511 where it was held that the pension is given to the legally wedded wife of a deceased employee.

The Court held that the petitioner being the second wife of the deceased employee, who was a Hindu, cannot be held entitled to family pension.

The Court also discussed the entitlement of the family pension by the children born from void and voidable marriages. The Court observed that as per Section 16 of the Hindu Marriage Act, 1955, children of born out of null and void marriage shall be legitimate and under Rule 54(7) (c) of CCS (Pension) Rules, the pensionary benefits will be granted to the children alongwith the legally wedded wife.

[Durga Devi v. State of H.P., Civil Writ Petition No. 1657 of 2016, dated 05-08-2022]

*Ritu Singh, Editorial Assistant has put this report together.

Case Briefs Foreign Courts

Employee or Independent Contractor? Supreme Court of New Jersey decides the issue for East Bay Drywall, LLC; holds that workers were misclassified

Supreme Court of New Jersey: While considering whether certain workers employed by East Bay Drywall, LLC, were properly classified as employees or independent contractors as per the “ABC Test” set forth under the Unemployment Compensation Law; the Supreme Court of New Jersey held that East Bay did not supply sufficient information to prove the workers' independence under the ABC Test and the Commissioner's findings of the same was not arbitrary, capricious, or unreasonable. The Court decided that East Bay misclassified its workers as independent contractors. The Bench of the Court comprising Stuart Rabner, CJ., and Anne M. Patterson, Lee Solomon and Fabiana Pierre-Louis JJ., joined the opinion delivered by Jose L. Fuentes, J.

Facts and Legal Trajectory: East Bay (a business registered as an employer), is a drywall installation business that hires on a per-job basis. Once a builder accepts East Bay's bid for a particular project, East Bay contacts workers to see who is available. Workers are free to accept or decline East Bay's offer of employment. East Bay provides the workers with the raw materials necessary to complete the drywall installation. The workers perform the labor but must provide their own tools and arrange for their own transportation to the worksites. East Bay does not dictate who or how many laborers the workers must hire to complete the project and also does not direct how the workers install drywall. However, East Bay remains responsible for the finished product.

On 30-06-2013, East Bay ceased reporting wages to the Department of Labor and Workforce Development (hereinafter Department). Consequently, an auditor for the Department conducted a status audit that reviewed the workers hired between 2013 and 2016, to determine whether they were independent contractors, as defined by the ABC Test, or employees of East Bay, requiring the employer to contribute to the unemployment compensation and temporary disability funds. In addition to meeting with East Bay's principal and accountant, the auditor requested documentation such as tax forms, business cards, and business insurance to determine whether the workers' businesses were independent entities. The auditor found that approximately half of the alleged sub-contractors working for East Bay between 2013 and 2016 — four individuals and twelve business entities (total- 16) should have been classified as employees. East Bay owed $42,120.79 in unpaid unemployment and temporary disability contributions as per the findings of the auditor.

East Bay challenged the results of the audit and requested a hearing in the Office of Administrative Law, which concluded that three of the workers were employees but the other thirteen were independent contractors. The Commissioner of the Department determined that all sixteen workers failed all three prongs of the ABC Test and that they were therefore employees of East Bay. The Appellate Division affirmed the Commissioner's final determination as to five workers but reversed as to the eleven other workers. The Department then appealed for the eleven workers, and the Court granted certification.

What is the ‘ABC Test' under Unemployment Compensation Law? ¹

The ABC test is used in some states to determine whether a person is an employee or an independent contractor for the purpose of determining state unemployment tax. Some courts use this test to look at whether a worker meets three separate criteria (prongs) to be considered an independent contractor:

The worker is free from the employer’s control or direction in performing the work.
The work takes place outside the usual course of the business of the company and off the site of the business.
Customarily, the worker is engaged in an independent trade, occupation, profession, or business.

Observations and Conclusion: The unanimous decision of the Court was delivered by temporarily assigned Justice Jose L. Fuentes, P.J.A.D.

The Court observed that The Unemployment Compensation Law (UCL), N.J.S.A. 43:21-1 to -71, acts as a “cushion against the shocks and rigours of unemployment”. The law requires that employers and employees make contributions to the unemployment compensation and temporary disability benefit funds. However, even if a worker receives compensation for work performed, the worker will not be considered an employee if the ABC Test is fulfilled.
Regarding the ABC Test, the Court observed that test is conjunctive; thus, all three prongs must be satisfied for a worker to be considered an independent contractor. The ABC Test presumes a worker is an employee therefore, the party challenging the classification carries the burden to establish the existence of all three criteria of the ABC test.
It was further observed that East Bay did not supply sufficient information to satisfy prong C burden regarding the eleven entities whose classification has been challenged by the Department. Prong C of the ABC Test broadly asks whether a worker can maintain a business independent of and apart from the employer. If the worker “would join the ranks of the unemployed” when the relationship ends, the worker cannot be considered independent under prong C.
The information East Bay provided is insufficient to prove the entities' independence. The probative value of refusal to accept or complete work is limited because, like an employee, even a bonafide independent contractor is not free from the pressure to accept a job. “A certificate of insurance could be a significant indication of independence, and business registration information may bolster the inference of independence. Here, however, these documents do not elucidate whether the disputed entities were engaged in independent businesses separate and apart from East Bay”.
The Court concluded that the instant case presents one of those less-obvious situations of whether the workers are truly independent business entities. Thus, consideration of the prong C factors is appropriate; but, in attempting to meet its burden, East Bay has provided little or no documentary evidence to address those factors. “For example, East Bay has not provided evidence that the entities maintained independent business locations, advertised, or had employees”.
It was further stated that any business practice that requires workers to assume the appearance of an independent business entity, can give rise to speculation that such a practice was intended to obscure the employer's responsibility to remit its fund contributions. “That type of subterfuge is particularly damaging in the construction context, where workers may be less likely to be familiar with the public policy protections afforded by the ABC test and consequently particularly vulnerable to the manipulation of the laws intended to protect all employees. Such a business practice also undermines the public policy codified in the UCL”.

Decision: With the afore-stated observations, the Court held that, since each entity at issue fails prong C of the ABC Test, therefore they can be properly classified as an employee. The Court remanded the matter to the Department for calculation of the appropriate back-owed contributions.

[East Bay Drywall, LLC v. Department of Labor & Workforce Development, (A-7-21) (085770), decided on 02-08-2022]

Advocates who appeared in this case :

Christopher Hamner, Deputy Attorney General, Advocate, for the Appellant;

Jennifer B. Barr, Advocate, for the Respondent;

Ravi Sattiraju, Advocate, for the Amicus Curiae.

*Sucheta Sarkar, Editorial Assistant has prepared this brief.

1. ABC Test, LII, Cornell Law School

Case Briefs High Courts

Uttaranchal High Court | Non-communication of all the Service Rules does not indicate that there are no Rules

Uttaranchal High Court: The Division bench of Vipin Sanghi, C.J., and R.C. Khulbe, J., had held that merely because the communication sanctioning a post does not indicate the promotion rules, does not mean that there are no Rules framed or applicable for promotion, requiring minimum service in the feeder cadre.

Facts:

The appeal was preferred by the appellants after obtaining leave, since they were not parties to the writ proceedings, wherein the impugned order was passed by the Single Judge on 11-08-2017. The writ petitioners are respondents in this instant appeal preferring a writ petition assailing the order dated 09-09-2016 passed by the respondent authority, whereby the respondents were promoted to the post of Assistant Accounts Manager in the Uttarakhand Forest Development Corporation.

The appellants have assailed the impugned order dated 11-08-2017 on the ground that the Court wrongly proceeded on the premise that, for promotion to the post of Assistant Accounts Manager, the persons working in the feeder post should have substantive service of at least 7 years, as a condition of eligibility. According to the appellants there was no minimum qualifying service required.

Arguments:

The counsel for appellant contended that prior to bifurcation of the State of Uttarakhand from the State of Uttar Pradesh, in the Uttar Pradesh Forest Development Corporation, from which the respondent corporation has been carved out, the service conditions were governed by Regulations framed in the year 1985. In the said Corporation's promotion Rules, the minimum required service of 7 years was prescribed in the feeder cadre. However, upon the creation of the State of Uttarakhand, the respondent was created in the year 2001. According to the appellants, after 2001, the 1985 Regulations of the Uttar Pradesh Forest Development Corporation were no longer applicable. He further submitted that on 06-06-2007, a completely new cadre of officers was created in the respondent corporation.

The counsel finally submitted that even the communication did not clearly indicate as to what were the promotion rules. Further, the mandatory requirement of experience must be deemed to have been waived.

The counsel for the respondent corporation drew attention to Sections 67 and 74 of the Uttar Pradesh Reorganisation Act, 2000 (‘UP Reorganization'), which led to the formation of the State of Uttarakhand. He submitted that as the corporation has carved out from Uttar Pradesh Forest Development Corporation it continues to operate in the State of Uttarakhand.

The counsel placed his reliance on Section 74 of the UP Reorganisation Act argued that the conditions service of persons serving in connection with the affairs of the State, could not be alerted to their disadvantage, and they continued to operate as they were operating prior to bifurcation of the State. He submits that no previous approval was obtained by the Central Government to remove the minimum requirement.

Observation and Analysis:

The Court found no merit in the argument that there was any requirement of any minimum qualifying years of service.

Further it was held that merely because the order sanctioning the posts did not indicate the promotion Rules, does not mean that there was no Rule framed or applicable for promotion.

Hence, the respondent corporation was directed to fill up the vacancies in the cadre and the special Appeal was dismissed.

[Krishna Kunwar Singh Dewari v. Kripal Singh, Special Appeal No. 682 of 2018, decided on 19-07-2022]

Advocates who appeared in this case :

Counsel for Appellants: Mr. Bhagwat Mehra, Advocate

Counsel for Respondents: Mr. Abhijay Negi, Advocate

Mr. K.N. Joshi, Deputy Advocate General

Mr. V.K. Kapruwan, Advocate

https://hcservices.ecourts.gov.in/ecourtindiaHC/cases/display_pdf.php?filename=rC8SUFuyEFsvB5V61cXUrElu1MmZWPXzCwheqkAW3XaTdJ8LLlyIa%2B%2FGilaNnsw2&caseno=SPA/682/2018&cCode=1&appFlag=

Case Briefs Supreme Court

Explained| What happens when a candidate, in a competitive exam, uses different language in answer sheet than that filled in application form?

Supreme Court: In the case where a candidate appearing for examination for recruitment to the post of Constables in Railway Protection Force (RPF) had used a different language in the OMR answer book than that filled in the application form, the bench of Hemant Gupta* and Vikram Nath, JJ has held that his candidature was rightly rejected.

In the present case, more than 11,000 posts were advertised for filling up of the posts of Constables in the RPF. Though the number of candidates who appeared in response to such advertisement is not available, but generally, it is a matter of common experience that candidates much more than the posts advertised are the aspirants for such posts. It is important to note that,

The question papers are required to be set up in the languages other than Hindi and English as well.
The applications in different languages were to be sent to different Nodal Officers in Gorakhpur, Kolkata, Bhubaneshwar and Chennai.
The OMR answer sheet is bilingual, in Hindi and English, but it would be in some other language if a candidate has chosen a language other than English or Hindi.

The reason for the condition that language in the application form shall be used for the purposes of OMR examination is that in case any dispute arises in respect of identity of the candidate, the same can be verified from the two handwritings.

The candidate in question has used a different language in the OMR answer book than that filled in the application form. The Division Bench of the Allahabad High Court was of the opinion that on account of lapse of time, the writ petitioner might have attempted the answer sheet in a different language.

The Supreme Court, however, disagreed and held that since the advertisement contemplated the manner of filling up of the application form and also the attempting of the answer sheets, it has to be done in the manner so prescribed. The use of different language itself disentitles the writ petitioner from any indulgence in exercise of the power of judicial review.

“Once the writ petitioner has filled the application form in English, having also signed in English, it cannot be said to be an inadvertent mistake when he has written the para in Hindi. Such writing in different language violates the instruction clearly mentioned in the advertisement.”

It was observed that the language chosen is relevant to ensure that the candidate who has filled up the application form alone appears in the written examination to maintain probity. The answer sheets have to be in the language chosen by the candidate in the application form. It is well settled that if a particular procedure in filling up the application form is prescribed, the application form should be filled up following that procedure alone.

[Union of India v. Mahendra Singh, 2022 SCC OnLine SC 909, decided on 25.07.2022]

*Judgment by: Justice Hemant Gupta

For UOI: ASG Madhavi Divan

For candidate: Advocate Prashant Bhushan

Case Briefs High Courts

Jharkhand High Court| Date of application or Date of death – From when is the monetary compensation on account of death of an employee to be paid?

Jharkhand High Court: S.N. Pathak, J., allowed the writ petition directing Central Coalfields Limited (‘CCL') to modify the monetary compensation in case of death or an employee who died in harness, calculating it from date of death of the husband of the petitioner.

The petitioner prayed to direct the respondents to pay the monetary compensation, arrear and interest from the date of death of her husband i.e., 02-09-2018, who was in service of CCL and died in harness.

Facts:

The husband of the petitioner was appointed in the service of CCL on 02-09-1985. The petitioner was left with 3 daughters after the death. One of the daughters applied for compassionate employment within the time limit as per National Coal Wage Agreement (‘NCWA'). However, the claim was accepted and the petitioner was advised to apply for monetary compensation in response to which the petitioner applied for grant on 14-02-2020. In response the respondent demanded to submit some documents and directed the petitioner to appear at Gandhi Nagar hospital. In spite of completion of all the formalities the respondent did not pay the compensation. Therefore, the petitioner preferred this writ petition.

Arguments:

The counsel for the petitioner submitted that the petitioner is entitled to receive monetary compensation and the respondent cannot delay the matter. It was also brought to the notice of the Court that the issue regarding the date of payment has already been decided by the Division Bench on 07-07-2020, wherein the Court has opined that the monetary compensation has to be paid from the date of death of the said employee and not from the date of making application for payment of monetary compensation.

The counsel for the respondent submitted that the petitioner submitted a representation on 05-09-2018 with regard to information of the death of the deceased. It was brought to the notice of the Court that the daughter who applied for compassionate employment is married and there are no provisions/rules/schemes for the employment of a married daughter in the respondent company. Therefore, the petitioner was advised to make an application for payment of monetary compensation. Further, it was argued that according to the guidelines of the respondent company, monetary compensation has to be made from the first day of the following month on which the application was made for monetary compensation. In this case, the application was made in the month of August hence the payment will be made w.e.f. 01-09-2020 and accordingly a sum of Rs.26,292.97 was granted.

Observation and Analysis:

The Court observed that there is no stipulation made in NCWA that monetary compensation will be paid from the date of application hence the Court directed to the respondent that monetary compensation will be payable from the date of cause of action, death of the employee. The Court also directed the respondent not to make any addition in NCWA making the monetary compensation payable from the date of application.

[Dibya Jani v. Central Coalfields Ltd, 2022 SCC OnLine Jhar 646, decided on 20-06-2022]

Advocates who appeared in this case :

Mr. Abhijeet Kr. Singh, Advocate, Counsel for the Petitioner;

Mr. Darshna Poddar Mishra, AAG-I, Advocate, Counsel for the Respondents.

Case Briefs High Courts

Gauhati High Court| ‘Cousin’ not a family member; cannot be considered for Preferential Appointment under Assam Public Services (Preferential Appointment) Rules, 1999

Gauhati High Court: The single Bench of Michael Zothankhuma, J., disposed of the writ petition and held that a cousin cannot be included within the definition of ‘member of family’ under the provisions of Assam Public Services (Preferential Appointment) Rules, 1999 (hereinafter as APS Rules, 1999).

A writ petition was filed by the petitioner stating that he was the cousin of the deceased Gajendra Bijoy Rabha, who was a martyr in the Assam Movement and hence, was entitled to be given a preferential appointment as per the provisions laid down of the Assam Public Services (Preferential Appointment) Rules, 1999.

Dismissing the petition, the Bench observed that under Rule 2 (d) of the APS Rules, 1999, a preferential appointment is provided to only certain categories of family members which includes a son or daughter of the spouse or a brother or sister of a martyr or a physically disabled person. Therefore, the Bench held that a cousin cannot be included within the definition of ‘member of family’ under the APS Rules,1999. Hence, the petitioner was not entitled to preferential appointment in Assam Public Services as per the provisions of the rules.

[Jackie Rabha v. Principal Secretary to the Govt of Assam, 2022 SCC OnLine Gau 1074, decided on- 18-07-2022]

Appearances

For the Petitioner: MD B Islam, Advocate
For the Respondent: GA, Assam

Legal RoundUp Supreme Court Roundups

Supreme Court June 2022 Roundup| Clean chit to PM Modi; Maharashtra Political Crisis; Psychological Evaluation of Death Row Convicts; and more

Clean Chit to PM Modi in 2002 Gujarat riots case

“SIT Officials have come out with flying colours unscathed despite all odds”; SC upholds SIT’s clean chit to PM Modi in 2002 Gujarat riots

“The protagonists of quest for justice sitting in a comfortable environment in their air-conditioned office may succeed in connecting failures of the State administration at different levels during such horrendous situation, little knowing or even referring to the ground realities and the continual effort put in by the duty holders in controlling the spontaneous evolving situation unfolding aftermath mass violence across the State.”

Maharashtra Political Crisis

Supreme Court refuses to stay Trust Vote; Uddhav Thakrey resigns as CM

No stay on floor test, disqualification proceedings to be kept in abeyance till July 11; Read SC’s directions on Eknath Shinde’s plea

Psychiatric & Psychological Evaluation of death row convicts

Supreme Court mandates call for mental health report before pronouncing death sentence

“Implicit in this shift is the understanding that the criminal is not a product of only their own decisions, but also a product of the state and society’s failing, which is what entitles the accused to a chance of reformation.”

Insolvency and Bankruptcy

Liability in respect of a claim arising out of a Recovery Certificate is a “financial debt” under Section 5(8) of the IBC

The words “means a debt along with interest, if any, which is disbursed against the consideration for the time value of money” are followed by the words “and includes”. By employing the words “and includes”, the Legislature has only given instances, which could be included in the term “financial debt”. However, the list is not exhaustive but inclusive.

NEET-PG 2021

“Process of admission and that too in the medical education cannot be endless”; SC says no to Stray Round of counselling for unfilled NEET-PG 2021 seats

“There cannot be any compromise with the merits and/or quality of Medical Education, which may ultimately affect the Public Health.”

Fact Check of this Supreme Court story from a Leading Newspaper

On June 14th 2022, a leading newspaper had published an article with the headline “Illegitimate child of cohabiting couple to get assets share: Supreme Court”. While on the face of it, it appeared to be a landmark judgement, on our correct analysis of the judgment, we found out that neither the couple was held to be cohabitating “without marriage” nor was the son considered to be “illegitimate”.

Read the Fact Check: We fact-check a leading newspaper’s misleading headline “Illegitimate child of cohabiting couple to get assets share: Supreme Court”

Read the accurate analysis by the SCC Online Blog: Long co-habiting couple’s child cannot be disentitled from family property in absence of proof against presumption of marriage

Most Read Story of the Month

Beyond Reasonable Doubt versus Preponderance of Probabilities: Supreme Court explains why circumstances guide the Courts in deciding Right to Private Defence cases

“The underlying factor should be that such an act of private defence should have been done in good faith and without malice.”

Cases Reported in SCC

2022 SCC Vol. 4 Part 2 : In 2022 SCC Volume 4 Part 2, read this very pertinent matter of the Supreme Court wherein it was decided whether culpable homicide tantamounts to murder or not. [State of Uttarakhand v. Sachendra Singh Rawat, (2022) 4 SCC 227]

2022 SCC Volume 4 Part 3: This part consists a very pertinent decision of the Supreme Court wherein it was held that it cannot be said that the Tribunal will have jurisdiction only if the subject property is disputed to be a waqf property and not if it is admitted to be a waqf property as such interpretation will be against the provisions Section 83(1) of Act. [Rashid Wali Beg v. Farid Pindari, (2022) 4 SCC 414]

2022 SCC Volume 4 Part 4: This part encapsulates, a very interesting decision, wherein while criticizing the practise of granting cryptic bail in a casual manner, the Court expressed, “It would be only a non speaking order which is an instance of violation of principles of natural justice. In such a case the prosecution or the informant has a right to assail the order before a higher forum.” [Brijmani Devi v. Pappu Kumar, (2022) 4 SCC 497]

2022 SCC Vol. 5 Part 1: This part encapsulates, a very interesting decision of the Supreme Court wherein the Court while dealing with Appointment of Vice-Chancellor, held, that it cannot be made dehors the applicable UGC Regulations, even if the State Act concerned prescribes diluted eligibility criteria vis-à-vis the criteria prescribed in the applicable UGC Regulations. [Gambhirdan K. Gadhvi v. State of Gujarat, (2022) 5 SCC 179]

2022 SCC Vol. 5 Part 2: This part covers the decision wherein the scope of “deemed authorization” clause under S. 16 provisio of the Petroleum and Natural Gas Regulatory Board Act, 2006 has been dealt with. It has been held that if one reads S. 16 proviso in isolation, the inference undoubtedly would be that every entity which had started laying and building pipelines and networks was the recipient of the deemed authorisation clause i.e. the provision sought to retrospectively regularise activities by all entities, however, such a plain and facial construction is unacceptable. [Adani Gas Ltd. v. Union of India, (2022) 5 SCC 210]

2022 SCC Vol. 5 Part 3: This part consists of an important decision on the menace of “dowry”, wherein it has been held that “Dowry” ought to be ascribed an expansive meaning so as to encompass any demand made on a woman, whether in respect of a property or a valuable security of any nature. [State of M.P. v. Jogendra, (2022) 5 SCC 401]

2022 SCC Vol. 5 Part 4: This part covers a pertinent decision on Section 29-A(h) of the Insolvency and Bankruptcy Code, 2016, wherein it has been held that existence of personal guarantee invoked by creditor is sufficient to render disqualification against the person executing guarantee, even when the application seeking initiation of insolvency resolution process is filed by some other creditor. [Bank of Baroda v. MBL Infrastructures Ltd., (2022) 5 SCC 661]

SCC Snippet

Why Reason is the Soul of Justice : The bench of GS Singhvi and AK Ganguly, JJ, in Kranti Associates Private Limited v. Masood Ahmed Khan, (2010) 9 SCC 496, stressed upon the importance of reasoned judicial orders and elaborated on why “reason is the soul of justice.”

Case Briefs High Courts

Jhar HC | Issuance of Ph.D, degree to the research student not a pre-condition for a Lecturer/Reader’s promotion to the post of University Professor

Jharkhand High Court: In a case relating to qualification to be appointed as a professor at Vinoba Bhave University, Anubha Rawat Choudhary, J, considering that the respondent had completed 16 years of working as a Lecturer/Reader and that there was considerable progress in work of the research student whom she had been guiding, held that respondent had the required experience of guiding research at Doctoral level as on the cut off date, even though the concerned research student did not receive Ph.D degree within the stipulated time.

The respondent obtained Ph.D degree on 09.11.1985 after which she guided a student for research who was enrolled in the year 1987 and the Ph.D work was to be completed in 4 years and a further extension of 2 years time was to be given and the same expired in 1992. The student got re registered on 14.12.1996. On the cut off date i.e. on 22.09.1995, no student was enrolled for research under the respondent and the student who was enrolled in the year 1987 did not complete his research work within the stipulated time and was not granted Ph.D although the papers were published and were presented in the conferences. It was, hence, contended that the respondent was not duly qualified on the cut-off date.

Respondent, on the other, argued that as per the statute for time bound promotion of teachers under the Bihar Universities Act, a teacher was entitled to be promoted after 16 years of continuous service to the post of professor as a time bound promotion, subject to concurrence of the University Service Commission. She further contended that though the candidate was not conferred the Ph.D degree, but the thesis was submitted, which indicated that she had guided her in the matter of research.

Reliance was placed on Patna High Court’s decision in Dr. Kalpnath Singh v. the Bihar State University Service Commission, CWJC No. 2014 of 1997 wherein it was held,

“… while guiding research at doctoral level starts from the date of registration of the students for Ph. D. Degree, it has got nothing to do with publication of results of Ph. D. Degree of such students. It is the experience during the intervening guiding period at the doctoral level, which is the requirement to count experience of a Reader for promotion to the post of University Professor and the same has got nothing to do after the student obtained Ph. D. Degree on passing the examination.”

The Court, hence, held that Jharkhand Public Service Commission’s contention that the respondent did not have the requisite experience of guiding a student for research, was devoid of any merits and hence dismissed the review petition.

[Jharkhand Public Service Commission v. Vanmala Choudhary, 2022 SCC OnLine Jhar 494, decided on 13.06.2022]

Advocates who appeared in this case :

Sanjay Piprawall, Advocate, for the petitioner;

I. Sen Choudhary, Advocate, for the University;

Siddharth Roy, Advocate, for the State.

Cases Reported Supreme Court Cases

2022 SCC Vol. 5 Part 2

Civil Procedure Code, 1908 — Or. 41 Rr. 4 & 33, Ss. 96, 100 and Or. 20 R. 18 — Partition suit — Appeal — Non-appealing plaintiffs: Some of plaintiffs whose claim was denied by trial court and who had not challenged same by way of appeal before first appellate court, held, are entitled to relief in second appeal. In a partition suit, all parties stand on the same pedestal and every party is a plaintiff as well as a defendant. Position of plaintiff and defendant can be interchangeable. Trial court could grant relief even to non-appealing plaintiffs and make an adverse order against all defendants and in favour of all plaintiffs. Merely because trial court had not granted relief in favour of some of plaintiffs, would not come in the way in High Court allowing their claim. [Azgar Barid v. Mazambi, (2022) 5 SCC 334]

Constitution of India — Art. 226 — Maintainability of writ petition — Proceedings under SARFAESI Act: If proceedings are initiated under the SARFAESI Act and/or any proposed action is to be taken and the borrower is aggrieved by any of the actions of the private bank/bank/ARC, borrower has to avail the remedy under the SARFAESI Act and no writ petition would lie and/or is maintainable and/or entertainable. [Phoenix ARC (P) Ltd. v. Vishwa Bharati Vidya Mandir, (2022) 5 SCC 345]

Constitution of India — Arts. 32 and 226 — Issue as to legislative competence — Maintainability: Matter already standing determined by a Constitution Bench of the Supreme Court. [M.C. Mehta v. Union of India, (2022) 5 SCC 291]

Constitution of India — Sch. VII List I Entry 84 and List II Entry 51: State Legislature, held, has no legislative competence to levy tax on waste liquor after distillation which is not suitable for human consumption. [State of Orissa v. Utkal Distilleries Ltd., (2022) 5 SCC 326]

Criminal Procedure Code, 1973 — S. 190(1)(b) r/w Ss. 173, 193 & 319 and Ss. 161 & 164 — Taking cognizance of offence on basis of police report — Protest petition: Even after process has been issued against some accused on one date, held, process can still be issued by the Magistrate against some other person against whom there is some material on record, but whose name is not included as accused in the charge-sheet. Lastly, Magistrate or court need not wait till stage of S. 319 CrPC to exercise such power. [Nahar Singh v. State of U.P., (2022) 5 SCC 295]

Foreword to a book: A foreword to the book “Competition Law” by Cyril Shroff. Foreword to competition law by Cyril Shroff, (2022) 5 SCC (J-25)]

Foreword to a book: A foreword to the book “Criminal Law and Criminal Justice: An Introduction to the Writings by Justice M.N. Venkatachaliah, Foreword to Criminal Law and Criminal Justice: An Introduction to the Writings by Justice M.N. Venkatachaliah, (2022) 5 SCC (J-22)]

Foreword to a book: A foreword to the book “Transgenders and the Law” by Justice A.K. Sikri. Foreword to transgenders and the law by Justice A.K. Sikri, (2022) 5 SCC (J-28)]

Government Contracts and Tenders — Formation of Government Contract — Modes of entering into a Government Contract — Public Auction/Tender — Award/Non-award of contract — Judicial review: Author of the tender document, reiterated, is taken to be the best person to understand and appreciate its requirements. Thus, if the interpretation of such author is manifestly in consonance with the language of the tender document or subserving the purchase of the tender, the Court would prefer to keep restraint. Further, the technical evaluation or comparison by the Court is impermissible. Thus, even if the interpretation given to the tender document by the person inviting offers is not as such acceptable to the constitutional court, that, by itself, would not be a reason for interfering with the interpretation given, so long as such interpretation is not arbitrary or whimsical. [Agmatel India (P) Ltd. v. Resoursys Telecom], (2022) 5 SCC 362]

Petroleum and Natural Gas Regulatory Board Act, 2006 — S. 16 — Noti. dt. 12-7-2010: Directions regarding adjudication of pending and new applications by Board i.e. post S. 16 coming into force, issued. [Petroleum & Natural Gas Regulatory Board v. Indraprastha Gas Ltd., (2022) 5 SCC 292]

Petroleum and Natural Gas Regulatory Board Act, 2006 — S. 16 r/w S. 17 — “Deemed authorisation” clause under S. 16 proviso — Scope of — Deemed authorisation: If one reads S. 16 proviso in isolation, the inference undoubtedly would be that every entity which had started laying and building pipelines and networks was the recipient of the deemed authorisation clause i.e. the provision sought to retrospectively regularise activities by all entities, however, such a plain and facial construction is unacceptable. Thus held, S. 16 proviso is not unqualified. The “deemed authorisation” clause is subject to other provisions of Ch. IV and S. 17 is one such provision under Ch. IV. Further, the scheme of S. 17 intrinsically classifies the two i.e. Central Government authorised entities, and others and the underlying basis for this statutory classification is that only entities which had been cleared or authorised by the Central Government prior to the coming into force of the Act were deemed to have authorisation under the Act, and therefore, had to furnish certain details. As with regard to the others i.e. entities not authorised by the Central Government, fresh applications were necessary which were to be assessed by the Board on a case-by-case basis and in accordance with uniform standards. [Adani Gas Ltd. v. Union of India, (2022) 5 SCC 210]

Service Law — Promotion — Criteria/Eligibility — Length of service/qualifying service — Time-bound promotion — Entitlement to: Services rendered by employee on work-charge basis may considered for computing 12 yrs of service for grant of time-bound promotion (TBP). [State of Maharashtra v. Madhukar Antu Patil, (2022) 5 SCC 322]

Service Law — Promotion — Criteria/Eligibility — Qualification/Experience — Classification based on nature of experience — Validity of: Policy decision to provide incentive marks for specified work experience inside the State and not for such work experience from some other State due to work pattern peculiarities and socio-economic/geographical peculiarities of the State, held, not arbitrary. Courts should be slow in interfering with policy matters unless the policy is found to be palpably discriminatory and arbitrary. [Satya Dev Bhagaur v. State of Rajasthan, (2022) 5 SCC 314]

Service Law — Regularisation — Entitlement to regularization: In this case, respondents were appointed on contractual basis for period of 11 months (which was continued from time to time), on fixed salary for temporary project. Their employment was continued based on interim order of High Court. It was held that respondents were appointed on temporary unit which was not regular establishment and posts on which they were appointed and continued to work were not sanctioned posts. Hence, impugned judgment directing State to consider cases of respondents for regularisation sympathetically and if necessary, by creating supernumerary posts, held, unsustainable and without jurisdiction. [State of Gujarat v. R.J. Pathan, (2022) 5 SCC 394]

Territorial Jurisdiction of Courts in Domestic Arbitration: In this article, issue of territorial jurisdiction of courts in arbitrations in India has been discussed. Territorial Jurisdiction of Courts in Domestic Arbitration: The Saga of seat and venue continues by Arjun Krishnan and Ankur Singh, (2022) 5 SCC (J-1)]

Treatment of Personal guarantors under the Indian insolvency regime: This article seeks to delineate the position of personal guarantors under the Insolvency Code and to discuss the treatment of promoters as personal guarantees under the Indian insolvency regime in light of the judgment in Lalit Kumar Jain, (2021) 9 SCC 321 and other relevant decisions. General principles relating to the treatment of Personal guarantors under the Indian insolvency regime by Sriram Venkatavaradan and Saai Sudharsan Sathiyamoorthy, (2022) 5 SCC (J-8)]

Case Briefs High Courts

Ori HC highlights need for equity in cases of deferred payments; Interest to be paid in delayed payment of arrears due to administrative laches

Orissa High Court: S. K Panigrahi, J. directed the State to pay simple interest computed at the rate of 6% per annum on account of deferred salaries within a period of 30 days from today.

The facts of the case are such that the petitioner joined service as the Headmaster in a government school and was rendering his services as a Government servant till his superannuation in year 2001. The Petitioner, being a 74-year-old man, was made to run from pillar to post to get his legitimate dues but owing to administrative latches, the same couldn’t materialize. The instant petition was filed as insofar as payment of arrears is concerned, has already been redressed but the interest component of the amount which has been held up for the last twenty-one years, is required to be paid.

Counsel for petitioner submitted that the redressal of grievance of the Petitioner will remain incomplete if he were to be denied of the interest component that is payable to him as a result of delay.

The Court observed that that salaries and pensions are due as a matter of right to employees, and, as the case maybe, to former employees who have served the State. Since, the petitioner rendered his services till superannuation as a government servant; his entitlement to the payment of salary is intrinsic to the right to life under Article 21 and to right to property which is recognized by Article 300A of the Constitution.

The Court further noted that the late decision taken by the opposite party is attributable to administrative latches across different levels and the same cannot be the reason to withhold the payment to the employees who admittedly worked at the relevant time. The employees, had the payment received within time and/or on due dates, could have utilized the same for various purposes.

The Court relied on judgment SK Dua v State of Haryana, (2008) 3 SCC 44 and observed that in the present case there is a delay of about 21 years in settling the salary arrears payable to the petitioner due to administrative latches is not acceptable. The present case is a clear example of inexcusable departmental delay. Even if it is assumed that the representations made by the petitioner were actively catered to, this cannot be an excuse for lethargy of the department because rules/instructions provide for initiation of process much before retirement. The exercise which was to be completed much before retirement was in fact started long after petitioner’s retirement.

The Court held the relief sought at the rate of 18% per annum be suitably scaled down”[Sovakur Guru v. State of Odisha, WPC (OA) No. 1553 of 2017, decided on 27-05-2022]

*Arunima Bose, Editorial Assistant has reported this brief.

Case Briefs Supreme Court

Pay on a par with last drawn pay on reemployment in Government Service? Not a matter of right, holds Supreme Court

Supreme Court: In a case where the bench of MR Shah* and BV Nagarathna, JJ was posed with the question as to whether on reemployment in the government service, an employee who was serving in the Indian Army/in the Armed Forces shall be entitled to his pay scales at par with his last drawn pay, it has been held that a claim for the last drawn pay in the armed forces is not a matter of right.

The issue revolved around the interpretation of Para 8 of the Central Civil Services (Fixation of Pay of Reemployed Pensioners) Order, 1986 [CCS Order]. The Court observed that as per the said provision, Emergency Commissioned Officer and a Short Service Commissioned Officer working in the Armed Forces on his employment to a civil post shall be entitled to advance increments equal to the completed years of service rendered in the Armed Forces on a basic pay equal to or higher than the minimum of the scale attached to the civil post in which they are employed. However, the pay arrived at should not exceed the basic pay last drawn by them in the Armed Forces.

Further, Para 8 of the CCS Order makes a reference to two rates of pay in case of emergency commissioned officers and short service commissioned officers being appointed in the government service:

First, they may be granted advance increment equal to the completed years of service rendered by them in the armed forces on a basic pay equal to or higher than the minimum of the scale attached to the civil posts in which they are employed. The pay is to be fixed with reference to the scale attached to the civil posts in which they are employed;

Second, while computing the pay in the aforesaid manner it should not exceed the basic pay last drawn by them in the armed forces. In another words, while computing the pay of the said officers who joined the civil posts their pay cannot exceed last drawn pay by them in the armed forces. In case it exceeds then it is capped to the last drawn pay in the armed forces.

The Court also explained that Para 8 of the CCS Order does not indicate that the pay last drawn by the re-employed person in the armed forces should be the pay to be computed when he joined the civil post. There is no entitlement of pay protection under para 8 of the CCS.

“The manner of computation of pay as envisaged under para 8 also clearly stipulates that the pay so arrived at should not exceed the basic pay (including the deferred pay but excluding other emoluments) last drawn by the respondent in the armed force. That does not mean that the respondent is entitled to a pay equal to what was last drawn by him in the armed force.”

The Court made clear that the reference to the last drawn pay in the armed forces is only to ensure that the pay computed in the civil post in the manner envisaged in para 8 of CCS Order does not exceed the basic pay (including the deferred pay but excluding other emoluments) last drawn by the personnel in the armed forces. For example, if the minimum of the scale attached to the civil post is higher than the last drawn pay of the personnel in the armed force and while computing the pay for the civil post as envisaged under para 8 of CCS if it so exceeds then possibly the last drawn pay in the armed forces could be paid. The said Rule prescribes fixation of a pay exceeding the basic pay (including the deferred pay but excluding other emoluments) last drawn by the personnel in the armed forces in respect of the civil post to which an exarmed force personnel is appointed. Thus, in a case where computation of pay exceeds last drawn pay in the armed forces then, in such a situation possibly the last drawn pay of such a personnel can be fixed.

[Union of India v. Anil Prasad, 2022 SCC OnLine SC 665, decided on 20.05.2022]

*Judgment by: Justice MR Shah

Counsels

For UOI: ASG Aishwarya Bhati

For Respondent: Senior Advocate Vinay Kumar Garg

Cases Reported Supreme Court Cases

2022 SCC Vol. 3 Part 4

In Part 4 of 2022 SCC Volume 3, read some very pertinent Supreme Court decisions, involving aspects regarding reservation, accountability of social media platforms, service law and more.

Constitution of India — Arts. 14, 15, 16 and 226 — Writ of mandamus in matters of reservation — Scope and limit: Order of High Court directing State Government to increase the percentage of reservation for a particular category, that is, to provide for 3% reservation/quota for sportspersons, instead of 1% provided by State Government, held, beyond its jurisdiction and a grave error. Court cannot issue a mandamus: (i) to provide for reservation or reservation for any particular community even on basis of any quantifiable data brought to its notice, or (ii) to collect quantifiable data to justify their action of not providing reservation. [State of Punjab v. Anshika Goyal, (2022) 3 SCC 633]

Constitution of India — Arts. 19(1)(a) & (2) and Arts. 194 & 105 — Accountability of Social media platforms, for posts made on such platforms by third parties: Extent of accountability of Social media platforms for posts made by third parties to House Committee of State Legislature, determined. [Facebook v. Delhi Legislative Assembly, (2022) 3 SCC 529]

Criminal Law — Public Accountability, Vigilance and Prevention of Corruption — Constitutional Authorities/Functionaries/High Public Offices — Security of Prime Minister of India: Directions issued for judicial inquiry into breach and lapses as the convoy of PM was stuck on a flyover for around 20 minutes. Records relating to PM’s visit seized and secured. Directions also issued for constitution of Enquiry Committee, terms of reference and stay of ongoing proceedings by Central and State Governments. [Lawyers Voice v. State of Punjab, (2022) 3 SCC 521]

Criminal Procedure Code, 1973 — S. 389: Suspension of sentence by Supreme Court on ground of plea of juvenility taken before Supreme Court for the first time, when warranted, explained. [Sagar Behara v. State of W.B., (2022) 3 SCC 526]

Criminal Procedure Code, 1973 — S. 439 — Bail: Grant of bail without considering relevant aspects and recording reasons is not justified. Law summarised regarding principles for grant of bail and considerations to be balanced therefore. [Manoj Kumar Khokhar v. State of Rajasthan, (2022) 3 SCC 501]

Criminal Procedure Code, 1973 — S. 482 — Failure to exercise quashment power — When not proper: In this case of alleged misappropriation of monies of complainant and others, main allegations are against other co-accused, in the facts and circumstances of the case, it was held that to continue criminal proceedings against both appellant-accused herein would be abuse of process of law and court and unnecessary harassment to appellants. Hence, High Court ought to have exercised its powers and discretion under S. 482 CrPC and ought to have quashed criminal proceedings against appellants. Hence, criminal proceedings under Ss. 406, 420, 467, 468, 471 and 120-B IPC including charge-sheet, quashed and set aside insofar as appellants herein are concerned. [Rekha Jain v. State of U.P., (2022) 3 SCC 497]

Service Law — Pension — Computation/Calculation of pension: In this case, respondent retired after one month of rejoining from leave for about two years without allowances. Cl. 2(2) as modified vide Circular GO (P) No. 230/2012/Fin. dt. 19-4-2012 envisaged that for computing 10 months’ emoluments for purpose of average emoluments in respect of employee who retired from service on or after 1-1-2006 and who during part 10 months drew pay in pre-revised scale, their pay in pre-revised scale was to be enhanced notionally to initial pay drawn in revised scale. For calculating average emoluments as per Kerala Services Rules, if during period of ten months, employee was absent from duty, on leave with or without allowances which qualified for pension, or having been suspended was reinstated in service without forfeiture of service, his emoluments for ascertaining average were to be taken, at what they would have been, had he not been absent from duty or suspended provided that benefit of pay in any officiating post would be admissible only if it was certified that he would have continued to hold that officiating post but for leave or suspension. Thus, part of 10 months not equivalent to past 10 months. Hence, impugned judgment finding fixation of pension @ Rs 19,334 in revised scale justified considering last drawn pay of Rs 46,400 by respondent, calls for no interference. [State of Kerala v. Anie Lukose, (2022) 3 SCC 629]

Legal RoundUp Supreme Court Roundups

Supreme Court April 2022 Roundup: Anganwadi Workers’ right to gratuity; Regulation of Foreign donations; Lakhimpur Kheri violence case; and more

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Producing false/fake certificate is a grave misconduct; Dismissal of service justified in such cases

“The question is one of a TRUST. How can an employee who has produced a fake and forged marksheet/certificate, that too, at the initial stage of appointment be trusted by the employer? Whether such a certificate was material or not and/or had any bearing on the employment or not is immaterial. The question is not of having an intention or mens rea. The question is producing the fake/forged certificate.”

Explainers

Cases Reported in SCC

2022 SCC Vol. 2 Part 4

In 2022 SCC Volume 2 Part 4, read a very interesting decision, wherein a death row convict subjected a 5-year-old girl to rape, killed her by strangulation, and then disposed of her body, tied in a gunny bag, into a stream and the 3-Judge Bench of the Supreme Court finding hope for reformation and rehabilitation commuted his death sentence to life imprisonment.

2022 SCC Vol. 3 Part 1

In a pertinent decision, Supreme Court while rejecting claim for interest the compared it to the Shakespearean character Shylock and remarked,

“…the holder of the Bond has received their ‘pound of flesh’, but they seem to want more. Additional sum in our estimation is not merited as SIBCO has already received their just entitlement and burdening the defendant with any further amount towards interest would be akin to Shylockian extraction of blood from the defendant.”

2022 SCC Vol. 3 Part 2

In 2022 SCC Volume 3 Part 2, read a very interesting case wherein a case where a Constable’s name was recommended by the Superintendent of Police but the same was dropped down by the Inspector General of Police for promotion under the 10% quota of outstanding performance for inclusion in the B-I List for promotion to the post of Head Constable in the year 2004, Supreme Court held that mere recommendation of the SP at the initial stage is not sufficient to claim a right for promotion.

Case Briefs Supreme Court

Insertion of meritorious OBC candidates into general category list without disturbing the appointment of general category candidates? Supreme Court strikes balance

Supreme Court: In a service matter where upon reshuffling and on insertion of two OBC candidates into general category select list, two general category candidates already appointed and working since long would have been expelled or removed, thereby unsettling the entire selection process, the bench of MR Shah* and BV Nagarathna, JJ exercised its powers under Article 142 of the Constitution of India to do complete justice to all the candidates involved.

Factual Background

BSNL issued notification in 2008 for filling up the post of Telecom Technical Assistants (TTAs). The recruitment was to be made by conducting a competitive examination of eligible candidates in an objective type paper of 200 marks. However, in the exam which was conducted no person from general category candidate got more than 40% marks. However, four candidates from OBC category obtained more than 33% marks.

Despite the poor pass percentage of candidates in the TTA examination, BSNL relaxed the qualifying marks by 10% for all candidates owing to the acute shortage of manpower. Accordingly, the qualifying marks were refixed at 30% for general category and 23% for reserved category.

However, two candidates, who were found to be more meritorious than the general category candidates subsequently were found eligible to be appointed against the reserved category – OBC. Therefore, the respondent No.1, who was wait listed No.1 in OBC category, approached the Tribunal for a direction to prepare a fresh list for all candidates based on relaxed standard and act on the said combined merit list. It was, inter alia, pleaded that there cannot be two cut-off marks for a single selection. It was submitted that there was an unreasonable classification by providing another set of cut-off marks and the action was discriminatory and violative of Articles 14 and 16 of the Constitution of India.

It was the case on behalf of the original applicant that those two candidates belonging to OBC category, who were having more merit were required to be adjusted against the general category seats and consequently the seats reserved for OBC category were required to be filled in from remaining reserved category candidates on merit.

Tribunal’s ruling

Tribunal directed BSNL to consider the candidature of the respondent No.1, if sufficient vacancies exist for placement of the candidates of OBC and further his candidature shall be considered against the present and future vacancies on OBC category.

High Court’s Ruling

Rajasthan High Court dismissed the writ petition preferred by BSNL by observing that the BSNL should have given appointment to the two candidates belonging to OBC category, against the vacancies which were not reserved vertically in the event of shuffling the said two persons to general category (admittedly both the candidates have secured and/or have more merit than the general category candidates, who were appointed). The High Court further observed that consequently the respondent no. 1 could have been selected against the vacancies reserved for the OBC.

Supreme Court’s Ruling

When the matter reached the Supreme Court, various decisions were taken note of wherein it was held that the reserved category candidates securing higher marks than the last of the general category candidates are entitled to get seat/post in unreserved categories. Further, even while applying horizontal reservation, merit must be given precedence and if the candidates, who belong to SCs, STs and OBCs have secured higher marks or are more meritorious, they must be considered against the seats meant for unreserved candidates. It is further observed that the candidates belonging to reserved categories can as well stake claim to seats in unreserved categories if their merit and position in the merit list entitles them to do so.

Applying the law laid down by the Supreme Court in various decisions to the facts of the case on hand, the Court noted that the two candidates, namely, Alok Kumar Yadav and Dinesh Kumar, belonging to OBC category, were required to be adjusted against the general category as admittedly they were more meritorious than the last of the general category candidates appointed and that their appointments could not have been considered against the seats meant for reserved category. Consequently, after considering their appointments in the general category, the seats meant for reserved category were required to be filled in from and amongst the other remaining reserved category candidates on merit such as respondent No.1.

“If such a procedure would have been followed, the original applicant – respondent No.1 would have got appointed on merit in the reserved category seats in the vacancy caused due to the above procedure.”

Therefore, the findings of the High Court were upheld.

The Court, however, was also alive to the fact that by reshuffling and on insertion of two OBC candidates into general category select list, two general category candidates already appointed shall have to be expelled and/or shall have to be removed, who are working since long and it may unsettle the entire selection process. Therefore, to strike a balance and to ensure that the two general category candidates, who are already appointed will not have to be removed and at the same time, respondent No.1 being a reserved category candidate also gets accommodated, if he is so appointed, in exercise of the powers under Article 142 of the Constitution of India, the Court ordered that on reshuffling and on respondent No.1 being appointed now against the reserved category seats and while the Alok Kumar Yadav and Dinesh Kumar, belonging to reserved category, to be treated in the general category seats, two candidates already appointed and belonging to general category shall not be removed. However, respondent No.1 shall get the seniority from the date the general category candidates were appointed, who were having lesser merit than Alok Kumar Yadav and Dinesh Kumar.

[Bharat Sanchar Nigam Ltd. Sandeep Choudhary, 2022 SCC OnLine SC 524, decided on 28.04.2022]

*Judgment by: Justice MR Shah

Counsels

Amicus curiae: Senior Advocate Dr. Rajeev Dhavan and Advocate Gaurav Agrawal

For BSNL: Advocate Pradeep Kumar Mathur

For respondent no.1: Advocate Puneet Jain

Case Briefs Supreme Court

‘Can’t allow mass absorption of over 11,000 workers based on a flawed Report’. SC forms new Committee to put an end to the long drawn LIC versus temporary employees battle

Supreme court: In a long ongoing battle between Life Insurance Corporation of India (LIC) and its temporary/badli/part-time employees over claim for absorption, the 3-judge bench of Dr. DY Chandrachud*, Surya Kant and Vikram Nath, JJ has appointed a two member committee to carry out fresh verification of the claims of workers who were working between 20 May 1985 and 4 March 1991 and who claim to have been employed for at least 70 days in Class IV posts over a period of three years or 85 days in Class III posts over a period of two years shall be carried out.

The Committee will consist of:

Justice P K S Baghel, former Judge of the Allahabad High Court; and
Rajiv Sharma, former District Judge and member of the UPHJS

In a 90-pages-long verdict that led to the aforementioned conclusion, the Court observed,

“The dispute is now of an antiquity tracing back to nearly four decades. Finality has to be wrung down on the dispute to avoid uncertainty and more litigation. Nearly thirty-one years have elapsed since 1991. We have come to the conclusion that the claims of those workers who are duly found upon verification to meet the threshold conditions of eligibility should be resolved by the award of monetary compensation in lieu of absorption, and in full and final settlement of all claims and demands.”

Background

The genesis of the present dispute relates to a demand raised by the Unions on 4 March 1991, pertaining to the claim for regularisation of those workers who were employed India with LIC as temporary/badli/part-time workers from 20 May 1985 till the date of reference on 4 March 1991.

The Central Government Industrial Tribunal (CGIT) which was presided over by K S Srivastav, directed that the temporary, badli and part-time workers who were employed after 20 May 1985 should be granted absorption on the same terms and conditions as was stipulated in the Tulpule and Jamdar Awards (in respect of workers who were employed from 1 January 1982 to 20 May 1985). LIC was directed to publish a notice in the newspapers for inviting applications from individual workers for absorption. If no regular vacancy was available, the award directed supernumerary posts to be created.

The Delhi High Court, however, set aside the said award.

On 12 December 2018, while dealing with the batch of contempt petitions, a two-judge Bench of the Supreme Court directed the CGIT to “look into the matter with regard to the claims made by the Union(s) individual workmen”. As many as 15,500 claims were submitted on behalf of the Unions, Associations and individual workers claiming absorption and the benefit of the Srivastav Award dated 18 June 2001. The CGIT submitted its report i.e. the Dogra Report on 31 May 2019.

The Dogra Report was primarily challenged by LIC on the ground that, as a consequence of the same, LIC would be required to regularise about 11,780 workers who claim to have worked for a limited number of days. No verification of these claims has been done either by the LIC or by the CGIT in the Dogra Report. This would amount to an illegal backdoor entry, which would be contrary to the statutory regulations framed by the LIC. Further, LIC would also face the issue of a lack of sanctioned posts for these workers.

Supreme Court’s Ruling

Dogra Report is Flawed

Holding the Dogra Report to be flawed, the Supreme Court observed,

“LIC as a statutory corporation is bound by the mandate of Articles 14 and 16 of the Constitution. As a public employer, the recruitment process of the corporation must meet the constitutional standard of a fair and open process. Allowing for back-door entries into service is an anathema to public service”

The Court found the Dogra Report to be flawed as,

(a) It failed to carry out an accurate verification of only those Class III workers who had put in at least 85 days of work in a period of two years and Class IV workers who had put in 70 days of work in a period of three years;

(b) The lists which are appended to the report contain patent inconsistencies and errors as a consequence of a failure to carry out an adequate verification; and

(c) The report accepted the claims for absorption of those workers who were specifically governed by the decision of this Court in E Prabavathy v. LIC[1], in spite of an express stipulation to the contrary in the order of the Supreme Court as well as in paragraph 75 of the Srivastav Award;

It was, hence, held that,

“A public employer such as LIC cannot be directed to carry out a mass absorption of over 11,000 workers on such flawed premises without following a recruitment process which is consistent with the principles of equality of opportunity governed by Articles 14 and 16 of the Constitution. Such an absorption would provide the very back-door entry, which negates the principle of equal opportunity and fairness in public employment.”

Directions

A fresh verification of the claims of workers who claim to have been employed for at least 70 days in Class IV posts over a period of three years or 85 days in Class III posts over a period of two years shall be carried out;
The verification shall be confined to persons who were working between 20 May 1985 and 4 March 1991;
All persons who are found to be eligible on the above norm shall be entitled to compensation computed at the rate of Rs 50,000 for every year of service or part thereof. The payment of compensation at the above rate shall be in lieu of reinstatement, and in full and final settlement of all claims and demands of the workers in lieu of regularisation or absorption;
In carrying out the process of verification, the Committee appointed by this Court shall not be confined to the certified list before the CGIT and shall consider the claims of all workers who were engaged between 20 May 1985 and 4 March 1991;
For the purpose of verification, LIC shall make available all the records at the Divisional level to the Committee appointed by this Court;
It will be open to the workers concerned or, as the case may be, the Unions and Associations representing them, to make available such documentary material in their possession for the purpose of verification;
The process of verification shall be carried out independently without regard to the Dogra Report, which is held to be flawed;
The payment of compensation in lieu of reinstatement shall be effected by LIC within a period of three months from the date of receipt of the report of verification by the Committee

[Ranbir Singh v. SK Roy, Chairman, Life Insurance Corporation of India, 2022 SCC OnLine SC 521, decided on 27.04.2022]

*Judgment by: Justice Dr. DY Chandrachud

Counsels

For LIC: Senior Advocate ANS Nadkarni

For Unions, Associations and workers: Senior Advocates Dr Manish Singhvi, Pallav Sishodia, R Singaravelan, V Prakash and Salman Khurshid and Advocates Nandakumar, Rakesh Shukla and Shailesh Madiyal

[1] SLP (Civil) No 10393 of 1992

Government Notification No. S-42013/1/95-SS.(II)

Decision in Ahmedabad Private Primary Teachers’ Association’s case, (2004) 1 SCC 755

Payment of Gratuity (Amendment) Act, 2009

Analysis and Findings

Whether the government empowered overrule judicial decisions by introducing Statutory Amendments?

Whether the Amendment financially confiscatory?

Applicability: Retrospective v. Retroactive

Whether the Amendment violative of Fundamental Rights?

Whether the Amendment violated other enactments?

Verdict

*Judgment by: Justice Sanjiv Khanna

Kamini Sharma, Editorial Assistant has put this report together

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*Judgment by: Justice MR Shah

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Background

Analysis

*Judgment by: Justice DR DY Chandrachud

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Issues

Analysis

Conclusion

*Judgment by: Justice JB Pardiwala

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*Judgment by: Justice MR Shah

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*Judgment by: Justice Hemant Gupta

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Also Read: From investigation till culmination of appeal/revision, victim has right to be heard at every step post the occurrence of an offence

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Factual Background

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Dogra Report is Flawed

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*Judgment by: Justice Dr. DY Chandrachud

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**Decision in Ahmedabad Private Primary Teachers’ Association’s case,** (2004) 1 SCC 755