THE HON'BLE SRI JUSTICE NOOTY RAMAMOHANA RAO WRIT PETITION No : 3092 of 2005 O R D E R: This Writ Petition has been instituted calling in question the legality and validity of the orders passed on 14.09.2001, followed up by the orders passed on 02.01.2002 and 25.03.2003. The facts, which are relevant for our enquiry, are these: The writ petitioner was appointed as a Science Teacher on 23.11.1987 in Government Senior Secondary School (Telugu Medium) in Andaman & Nicobar Islands Administration at Port Blair. He was subsequently appointed, to begin with on deputation basis, in one of the schools run and managed by the Andhra Pradesh Residential Educational Institutions at Vijayapuram Mandal in Chittoor District. He was later on absorbed into the service of the respondent Society. On 19.08.1999, proceedings have been issued by the Society, based upon the resolution passed by the Board of Governors at their meeting held on 22.07.1979, protecting the last pay drawn by him under the Andaman & Nicobar Islands Administration. It will be appropriate to quote that portion of the order of the proceedings dated 19.08.1999 of the Society: “ In the reference 1st cited, the services of Sri D. Jayachandran, formerly Science Teacher, Govt. Senior Secondary School (Telugu Medium) Andaman & Nicobar, and now on deputation as TGT in Bio. Science, A.P.R. School (ST-G), Srikalahasti, Chittoor District were absorbed into the Society Services w.e.f. 10.02.1997. The incumbent has requested for fixation of his pay in the Society based on the pay last drawn in his parent department. After careful consideration of the representation and keeping in view the resolution of Board of Governors at its meeting held on 22.07.1979 his pay is fixed at Rs.4270-00 in the time scale of pay Rs.2930-5960 w.e.f. 10.02.1997 plus usual allowances as admissible to the employees of A.P.R.E.I. Society.” Accordingly, the pay of the writ petitioner has also been fixed in the revised scale of pay of Rs.5500-175-9000, at Rs.5850/-. However, by an order dated 14.09.2001, based upon the audit objection, his pay is sought to be re-fixed at the minimum of the time scale of the Trained Graduate Teacher, thus, denying him the benefit of fixation at higher stage because of the pay protection accorded earlier. Hence, this Writ Petition has been instituted. It is not in dispute that the writ petitioner was employed in Andaman & Nicobar Islands Administration prior to his deputation to one of the schools run and managed by the 1st respondent society where he was eventually absorbed. The Board of Directors of the 1st respondent society have passed resolution at their meeting held on 22.07.1979 to protect the last pay drawn by the candidates, who are brought on deputation initially but who are absorbed into the service of the said Society later on. Sri V. Subrahmanyam, the learned counsel for the writ petitioner would point out that there is no error committed by the Board of Governors of the 1st respondent Society in seeking to protect the pay of the writ petitioner. It is permissible to draw the services of an employee to begin with on deputation basis. While he was drawn on deputation basis, his pay will be regulated based upon the pay drawn by him in his parent unit. When once the society absorbs him into its service, it becomes incumbent for the said Society to regulate his pay accordingly. Therefore, according to the learned counsel for the writ petitioner, the resolution passed by the Board of Governors is perfectly legitimate and valid exercise and no exception need be drawn thereto. In any view of the matter, proceeds the argument that the benefit of pay fixation at higher stage drawn by the writ petitioner, having not been based upon any mis-representation of fact, need not necessarily result in either re-fixation or recovery of excess amount. He places reliance upon the judgments reported in Sahib Ram v. State of Haryana[1] and State of Bihar v. Pandey Jagdishwar Prasad[2] in this respect. On the contrary, the learned Standing Counsel for the Society, Sri K. Durga Prasad, would submit that upon absorption into the service of the 1st respondent society, the employee enters into a new contract of employment. Therefore, the relationship of master and servant in that strict sense springs upon for the first time on the date of such absorption. It is therefore, incumbent for the new employer to regulate his pay. The writ petitioner, having thus been admitted to the employment of the 1st respondent society, his pay is fixed at the minimum of the scale of pay attached to the post and hence, no exception need be drawn to the impugned order, particularly when the same is based upon the objection raised by the audit. The basic facts are not in dispute namely, that the writ petitioner was in the employment of Andaman & Nicobar Islands Administration, prior to his services being taken on deputation basis by the 1st respondent society. His pay and allowances are regulated, duly taking into account and consideration the pay last drawn by him under Andaman & Nicobar Islands Administration. Upon absorption, he is not starting afresh, but he is continuing the same relationship. Instead of acquiring a new relationship, the relationship has only changed its form. Instead of a deputation, it has since fructified into a regular master and servant relationship. The writ petitioner has thus become functionally and fully controllable by the present employer in the matter of disciplinary control. There is never any misrepresentation of fact on his part. The Board of Governors of the 1st respondent Society are the highest policy makers and they have been vested with the powers to regulate the pay of the employees of the said Society. The resolution passed by the Board of Governors has never been recalled or revoked. So long as the said resolution is subsisting, it will not be proper or fair for functionaries, who perform their duties under the overall superintendence and guidance of the said Board of Governors of the 1st respondent Society to act contrary thereto. It will be important to notice that the pay of the petitioner, which is drawn by him at the time of his absorption, is what is sought to be protected by the Board of Governors. They have not assigned him any higher scale of pay than the scale of pay attached to the post against which he was drawn on deputation. In the same scale of pay, his pay has been fixed at a stage higher than the minimum of the said scale of pay. When a person is directly recruited to the service of an organization, unless he is allowed advance increments, his pay is bound to be fixed at the minimum of scale of pay attached to the post, but however, when a deputationist gets absorbed, he is not liable to start afresh his service, for his pay to be fixed at the starting stage or initial stage of the scale of pay attached to his post. As a deputationist, he would have carried the benefit of weightage of his past service. Therefore, protecting the pay of a person, who has been drawn on deputation, is not an uncommon or unusual phenomenon. When once such a person gets eventually absorbed in the interests of the organization, he cannot be subjected to peril of losing the benefit of higher pay which he was drawing prior to the date of eventual absorption. If he was drawing his pay and allowance at a particular stage prior to the date of his absorption, if the same were not to be protected, an adverse situation would arise whereby he would be drawing less than what he would have drawn while working on deputation basis with the same employer. Therefore, in my view, the Board of Governors have not committed any error in deciding to protect the pay of the writ petitioner upon his absorption. So long as such a decision is not faulty, the rest of the agencies like the Secretary to the Society, being an implementing agency of the decisions of the Board of Governors, cannot act contrary thereto. In my opinion, the impugned order virtually annuls or negatives the effect of the resolution passed by the Board of Governors. Such powers are not available in the hands of the Secretary to the 1st respondent society. It is fundamental that before any order is passed, whether it is administrative or quasi-judicial, which is likely to impact any other person with penal consequences, such a person is entitled to be put on notice and be heard as part of the obligation of compliance with the principles of natural justice. In the instant case, that was also breached. Hence, for the said reason also, the Writ Petition deserves to be allowed. Further, the learned counsel for the writ petitioner has rightly placed reliance upon the two judgments of the Supreme Court in Sahib Ram v. State of Haryana (1 supra) and State of Bihar v. Pandey Jagdishwar Prasad (2 supra). So long as there is no mistake of fact or misrepresentation employed by the writ petitioner, his pay fixation, which was done earlier, cannot be reversed. No recovery therefore, should have followed from his salary and allowances. For the aforementioned reasons, the Writ Petition is allowed. The petitioner is entitled to the benefit of pay fixation in terms of the resolution dated 22.07.1979 passed by the Board of Governors, based upon which the orders have been passed on 19.08.1999. ---------------------------------- Nooty Ramamohana Rao, J 18th November 2010 ksld ..... REGISTRAR // TRUE COPY // SECTION OFFICER To 1.2CCs to 2.2CD copies Form-NIC-OGS/WP{TRK} [1] 1995 Supp (1) Supreme Court Cases 18 [2] (2009) 3 Supreme Court Cases 117