IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.14205 of 2006 SUMITRA DEVI, wife of late Ram Pravesh Ram at Jaganpura, P.O. Phulwari, P.S. Phulwari, District Patna … Petitioner Versus 1. THE STATE OF BIHAR through the Chairman, Bureau of Public Enterprises, hutment Old Secretariat, Patna 2. Bihar State Financial Corporation, Frazer Road, Patna through its Managing Director 3. Managing Director, Bihar State Financial Corporation, Frazer Road, Patna 4. Chairman, Bureau of Public Enterprises, Hutment Old Secretariat, Patna … Respondents ------ P R E S E N T HON‟BLE MR. JUSTICE MIHIR KUMAR JHA ------ O R D E R (16.5.2011) Mihir Kumar Jha,J., Heard Mr. Manik Vedsen, learned counsel for the petitioner and Mr. Rajoo Giri for the Bihar State Financial Corporation as also learned counsel for the State. In this writ application the petitioner, widow of late Ram Pravesh Ram, who was an employee of the Bihar State Financial Corporation (hereinafter referred to as „the Corporation‟) and had died in harness, has sought a direction to the respondents to appoint her son Sanjay Prasad on compassionate ground. Mr. Manik Vedsen, learned counsel 2 for the petitioner, has submitted that the Government policy contained in the circular dated 5.10.1991 was binding on the Corporation and therefore, if the son of the petitioner had fulfilled all the requirement laid down in the aforementioned circular, the Corporation could not have refused to appoint him in the service of the Corporation. In this regard he has placed reliance on Section 39 of the State Financial Corporation Act, 1951 (hereinafter referred to as „the Act‟) for supporting himself that the Government policy dated 5.10.1991 will have to be read as a binding direction on the Corporation. Per contra, Mr. Giri appearing on behalf of the Corporation has submitted that first of all the Corporation no longer has the policy of the State Government for appointment on compassionate ground in force in view of the fact that the Board of Director of Corporation in its meeting held on 24.11.1997 vide item No. 12238 had resolved that in supersession of all earlier decisions with regard to appointment on compassionate ground, the individual package 3 on the pattern of Industrial Development Bank of India will be made applicable in Corporation. He has also pointed out that subsequently the said standing order issued by the Corporation in terms of the resolution of the Board of Director dated 24.11.1997 dated 10.12.1997 was further amended by both the resolution dated 4.6.1999 vide item No. 12453, wherein the compassionate package was also limited to the payment of only lump-sum ex-gratia grant to the affected family and the said decision was to be enforced to all the pending cases for grant of compassionate package. Mr. Giri in fact has taken a specific stand on the basis of the averment made in the counter affidavit that ever since 4.6.1999 no appointment in the Corporation has been made on compassionate ground and the dependents of the deceased employee are being only given the compensation package. He has in this regard also explained that on account of poor financial condition of the Corporation it cannot increase the strength of working employees and to that extent he had referred 4 to paragraph 6 of the supplementary counter affidavit suggesting that the Corporation has started acting upon the policy of restructuring of the Corporation in the light of the recommendation made by M/s Deloitee, a consultancy firm, which had suggested for retrenchment of 180 working employees for revival of functioning of the Corporation. In nut-shell the submission of Mr. Giri is that the Corporation is not in a position to appoint any person on compassionate ground. As is well settled that an appointment on compassionate ground is a decision of the employer himself and is always to be governed by the policy framed by the employer. There can be no dispute that the Corporation has under the Act power to appoint its Officers and employees, inasmuch as Section 23 of the Act reads as follows: “23. Officers and other employees of the Corporation.- The financial Corporation may appoint such officers, advisers and employees as it considers necessary for the efficient performance of its functions, and determine, by 5 regulations, their conditions of appointment and service and the remuneration payable to them. Provided that the State Government may in consultation with and after obtaining the advice of the Development Bank, specify the class or categories of posts in respect of which appointments may be made by the Board on such remuneration and other conditions of service as the Board may determine and no regulation made under this Act shall apply to such posts in respect of matters so determined by the Board.” The fact that the Corporation has also framed regulations for appointment on various posts of officers and employees is not in dispute. The submission of Mr. Vedsen that though the Corporation may have a power under section 23 of the Act to make appointment of its officers by framing the service condition so approved and enforced with the prior approval of the State Government, the moment the State Government by its circular dated 5.10.1991 has issued direction requiring all the Corporations to also have policy of compassionate appointment exactly on the dotted line of 6 the State Government, it has to be held that the provision of section 23 of the Act will not come in the way of the Corporation to make appointment on compassionate ground and that any subsequent decision taken after 5.10.1991 by the Corporation as explained in the counter affidavit abolishing all the very concept of compassionate appointment cannot be sustained, inasmuch as they are based on executive decision of the Corporation whereas the Government policy of compassionate appointment has to be treated to be one under section 39 of the Act by way of a direction of the State Government. Interesting though the aforementioned submission may be, but then the scope of section 39 of the Act as well does not envisage any power to the State Government to issue a direction in the matter of making appointment in Corporation. To that extent section 39 of the Act only limits the power of the Government to issue instruction on the „question of policy‟ as would be evident from its wordings quoted hereinbelow: 7 “39. Power to give instructions to Financial Corporation on question of policy.- (1) In the discharge of its functions, the Board shall be guided by such instructions on question of policy as may be given to it by the State Government and after obtaining the advice of Development Bank. (2) If any dispute arises betweens the State Government and the Board as to whether a question is or is not a question of policy, the decision of the State Government shall be final. (3) If the Board fails to carry out the instructions on the question of policy laid down by the State Government under sub section (1) of this section or the instructions given to the Board under sub section (4) of section 37A the State Government shall have the power to supersede the Board and appoint a new Board in its place to function until a properly constituted Board is set up and the decision of the State Government as to the grounds for superseding the Board shall not be questioned in any Court.” Normally having noted that the expression „question of policy‟ has already been decided by this Court and the Apex 8 Court in relation to an autonomous institution, namely, Bihar State Electricity Board, in terms of a similar provision under section 78A of the Electricity Supply Act, this Court was not required to go into the issue in an elaborate manner but when the Government policy of compassionate appointment contained in the circular dated 5.10.1991 in its last paragraph has provided for its made applicable in other autonomous institutions in the following terms: “11½ bl ifji= dh izHkko lhek & ;g ifji= jkT; ljdkj ds v/khuLFk lHkh yksd miØeksa] Lo'kklh fudk;ksa] izkf/kdkjksa] fuxeksa] i"kZnksa rFkk jkT; lEiksf"kr laLFkkvksa ij Hkh iw.kZ:i ls ykxw le>k tk;sxkA it will have to be first examined as to whether there is a dispute on the issue of appointment on compassionate ground between the State Government and the Corporation, inasmuch as sub-section (2) of section 39 lays down that the dispute between the Government and the Board of Director of Corporation shall end in the light of the decision taken by the State Government? In the present case, however, the State Government through the Deputy Secretary of the Finance Department has 9 taken a specific stand that it is only in the matter of policy that the State Government can give specific direction and that too when the reference for such policy is made by the Board of Director to the Government. In the said affidavit it has also been clarified that the Corporation is competent to take any independent decision with regard to compassionate appointment of the petitioner and to that extent it has supported the stand taken in paragraph 6 of the counter affidavit of the Corporation. Paragraph 6 of the counter affidavit of the State Government reading as follows: “That thus in the background of foresaid contentions the corporation is the only competent authority to take any decision in respect of petitioner‟s claim, which has already been taken by the corporation apparent from para-6 of the C/A filed on behalf of the B.S.F.C. in the aforesaid case.” followed by paragraph 6 of the stand taken by the Corporation in its first counter affidavit reading as follows: “That as far as the statement made in paragraph no.5 to 8 of the writ petition under reply is concerned, 10 in terms of the Standing Order No. 27/MDC 97-98 dated 10.12.1997 and Standing Order No. 7/MDC/99-2000 dated 20.7.1999 issued in terms of the decision of the Board of Directors of the Corporation, the Corporation introduced the system of payment of lump sum ex-gratia package on compassionate ground to the spouse etc. of an employee dying in harness and the system of providing appointment of one family member of the deceased employee was discontinued. Accordingly, following the directions as aforesaid in view of the death of petitioner in harness a cheque of Rs. 1,35,889.00 bearing no. 131881 dated 29.8.2006 was sent to the petitioner twice by letter no. 1120 dated 16.9.2006 and 1509 dated 17.10.2006. But the petitioner avoided receiving the cheque.” will leave nothing for speculation that on the issue of compassionate appointment despite there being a policy dated 5.10.1991 providing for its enforceability also in autonomous institution, the State Government has maintained a correct approach as with regard to scheme of compassionate appointment in the Corporation. Appointment of officers and staff 11 in an autonomous Board or Corporation cannot be said to be a question of policy and therefore, it would be very difficult for this Court to hold that the policy of compassionate appointment enforced in the State Government will automatically become also enforceable in the Corporation by virtue of its being treated as a direction under section 39 of the Act. This aspect of the matter was directly considered by a Division Bench of this Court in the case of Rakesh r1 Verma vs. State of Bihar, reported in 1991(1) PLJR 398, in relation to a similar provision of section 78A of the Electricity Supply Act, 1948 when the State Government had given a direction to the Bihar State Electricity Board to appoint Engineers by following chain system as prevalent in the different engineering departments of the State Government. In fact when the Board had refused to do so, a writ of mandamus was sought from this Court by the applicants seeking appointment in the Board by taking a plea that such a decision of the Government directing the Board to follow the chain 12 system based on the year of passing the engineering examination in the appointment of Engineers in the Board was binding on the Board. This Court however had repelled the same by holding that since the power under section 15 of the Electricity Supply Act, 1948 had clearly envisaged the full autonomy to the Board in the matter of appointment of its officers and staff, the order of the State Government to follow the chain system in the appointment of engineers could not be treated to be a „question of policy‟ and had, accordingly, dismissed the writ application. The matter had thereafter travelled to the Apex Court and the Apex Court also had approved the view taken by the Patna High Court. While dismissing the appeal filed by the writ petitioners in the case of Rakesh Ranjan Verma & ors. vs. State of Bihar & ors., reported in AIR 1992 SC 1348 the Apex Court had held as follows: “9. Section 78-A of the Act reads as under:- “Directions by the State Government.- (1) In the discharge of its function, the Board shall be guided by such directions on questions of policy as may be given 13 to it by the State Government. (2) If any dispute arises between the Board and the State Government as to whether a question is or is not a question of policy, it shall be referred to the Authority whose decision thereon shall be final.” 10. The above provision clearly lays down that the Board shall be guided by such directions on questions of policy as may be given to it by the State Government. In the circumstances of the case before us the directions given under letters dated 18.7.1988 and 5.5.1989 cannot be considered as directions on any question of policy. So far as the appointment of staff is concerned, S. 15 empowers the Board to appoint such officers and employees as may be required to enable the Board to carry out its functions under the Act. S. 15 of the Act reads as under:- “Appointment of staff.- The Board may appoint a Secretary and such other officers and employees as may be required to enable to Board to carry out its functions under this Act: Provided that the appointment of the Secretary shall be subject to the approval of the State Government.” 14 11. Thus, under the proviso to S.15, it is only the appointment of the Secretary which is subject to the approval of the State Government. So far as other staff is concerned, it lies with the Board to make appointment of all officers and employees as may be required to enable the Board to carry out its functions under the Act. Thus, we agree with the view taken by the High Court in this regard that the direction given by the State Government to appoint the appellants as Junior Engineers by the Board does not involve any matter of policy and it would be an encroachment on the powers of the Board given under S.15 of the Act.” Though it may be true that the provision of section 39 of the Act and section 78A of the Electricity Supply Act may not be pari materia the same but there is almost complete similarity and therefore, the expression „question of policy‟ in both Acts as with regard to the power of the State Government in the matter of issuing direction or instructions remains the same will have to be also interpreted in the similar manner. Thus, there would be no difficulty in holding that the Government 15 circular dated 5.10.1991 laying down policy for appointment on compassionate ground by itself would not be a „question of policy‟ in the context of section 39 of the Act. Once this aspect becomes clear there would be no difficulty in distinguishing the judgment in the case of Laxman Ram vs. The Hon‟ble High Court of Judicature at Patna & ors., reported in 2010(3) PLJR 353 which was heavily relied by Mr. Vedsen to contend that the matter of compassionate appointment would not remain confined to the scope of appointment under section 23 of the Act but would be a matter of policy as it relates to class as a whole for being given the benefit of rehabilitation on account of crisis created by certain death of the employee. In other words Mr. Vedsen would submit that the power of appointment would of course vest with the Corporation but in certain cases the Government will have power to lay down the policy for appointment in the Corporation and one of them may be by way of directing the Corporation to appoint people on compassionate ground. 16 This Court will not be in a position to accept this submission for a simple reason that when the expression of appointment has been used as a genus and not species in section 23 of the Act and does not carve out any exception, the State Government will have no role at all to play in the appointment of officers/ employees in the Corporation on any ground whatsoever. Compassionate appointment in fact also is an appointment which is in addition to a normal direct appointment or appointment by promotion. It is the only an additional mode of appointment where the person does not have to undergo the norms laid down for appointment from open market by way of direct appointment or appointment by way of promotion but none-the-less it still remains an appointment in the Corporation and therefore, section 23 as amended by the Act of 2000 taking away the power of the State Government to even render advice in the matter of appointment will leave nothing for speculation that any sort of appointment in the Corporation has to be made by the Corporation in terms of its own regulations 17 or the policy decision framed by the Corporation. True it is that the Corporation can frame service regulation only with the prior approval of the State Government but then there is nothing in the service regulation which provides for appointment on compassionate ground. The additional provision made by way of executive decision of the Board of Director, in terms of the provisions made in the Act of first allowing the appointment to be made in the Corporation and later on substituting it by a new policy of making one time payment by way of ex-gratia payment, therefore, does not infringe the provision made in the regulation framed by the Corporation for appointment of the officers and employees of the Corporation. It is in this respect that one will have to analyze the ratio laid down by this Court in the case of Laxman Ram (supra) wherein this Court had actually examined the issue of grant of extension of service to a Judicial Officer from 58 years to 60 years. It has to be remembered that extension of service from 58 years to 60 18 years for the Judicial Officers came in the light of the directions given by the Apex Court in the case of All India Judges‟ Association & ors. vs. Union of India & ors., reported in AIR 1993 SC 2493, where it was categorically held that the extension of service of Judicial Officers from 58 to 60 will not be automatic but will have to screened by the High Court in its exercise of its power under Article 235 of the Constitution of India so that any infirm indolent or incapable Judicial Officer does not get such extension of service as a matter of right. This Court would not find anything in the said judgment which can support the petitioner in his claim for appointment on compassionate ground. The plea of Mr. Vedsen that the financial condition of the Corporation in all the cases cannot be made a ground when the Corporation is still functioning and having its set-up has to be viewed from two angles. Firstly, the Corporation has been found to be facing dire financial constraints which made it to appoint a consultant for improving its financial 19 condition and in view of the advice rendered by the consultant the Board of Director has taken a decision to down-size its working strength of the employees. Thus, once the Corporation on the one hand will require to terminate the services or at least will not fill up the vacant post by appointing afresh any person for saving itself from incurring further financial liabilities on the payment of salary and wages to the officers and employees it would be quite logical to also infer that even compassionate appointment which will lead to payment of salary to the appointed person would be also against the existing policy of the Corporation to down- sizing its working strength of the employees. The other aspect and in fact more significant one is that death of the employee dying in harness does create a sudden crisis for his dependents which can be met either by offering employment on compassionate ground or by giving package by way of financial assistance. It cannot be said that in all the cases appointment on compassionate ground will be the only way in which the condition of the family of the 20 deceased employee can be improved. To that extent the Apex Court in the case of Umesh Kumar Nagpal vs. State of Haryana & ors., reported in (1994) 4 SCC 138, has clarified the situation in which compassionate appointment has to be offered and the law has been laid down therein that unless there would be a condition of abject poverty/ penury, an appointment on compassionate ground cannot be claimed as a matter of right. The Apex Court held as follows:- “2. The question relates to the considerations which should guide while giving appointment in public services on compassionate ground. It appears that there has been a good deal of obfuscation on the issue. As a rule, appointments in the public services should be made strictly on the basis of open invitation of applications and merit. No other mode of appointment nor any other consideration is permissible. Neither the Governments nor the public authorities are at liberty to follow any other procedure or relax the qualification laid down by the 21 rules for the post. However, to this general rule which is to be followed strictly in very case, there are some exceptions carved out in the interests of justice and to meet certain contingencies. One such exception is in favour of the dependents of an employee dying in harness and leaving his family in penury and without any means of livelihood. In such cases, out of pure humanitarian consideration taking into consideration the fact that unless some source of livelihood is provided, the family would not be able to make both ends meet, a provision is made in the rules to provide gainful employment to one of the dependents of the deceased who may be eligible for such employment. The whole object of granting compassionate employment is thus to enable the family to tide over the sudden crisis. The object is not to give a member of such family a post much less a post for post held by the deceased. What is further, mere death of an employee in harness does not entitle his family to such source of livelihood. The Government or the public authority concerned has to examine the financial condition of the family of the deceased and it is only if 22 it is satisfied, that but for the provision of employment, the family will not be able to meet the crisis that a job is to be offered to the eligible member of the family. The posts in Classes III and IV are the lowest posts in non-manual and manual categories and hence they alone can be offered on compassionate ground, the object being to relieve the family of the financial destitution and to help it get over the emergency. The provision of employment in such lowest posts by making an exception to the rule is justifiable and valid since it is not discriminatory. The favourable