1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION LETTERS PATENT APPEAL NO. 14 OF 2008 IN WRIT PETITION NO. 4141 OF 2006 ALONGWITH LETTERS PATENT APPEAL NOS. 15 TO 25 OF 2008 IN WRIT PETITION NOS. 4145, 4147, 4148, 4149, 4150,4151, 4152,4143, 4144, 4146 & 4142 OF 2006. The State of Maharashtra and another).......Appellants versus Pandurang Sitaram Jadhav )........ Respondant. Mr. A.P. Vanarse AGP for the Appellants Mr. S.M. Dharap i/b Mr. Neel Helekar for the Respondent. CORAM: SWATANTER KUMAR, C.J., & A.P. DESHPANDE, J. JUDGMENT RESERVED ON: 18TH JULY 2008. JUDGMENT PRONOUNED ON: 31ST JULY 2008. ORAL JUDGMENT ( PER A.P. DESHPANDE,J .): 1. These Letters Patent appeals involved a common question of fact and Law and hence the Appeals are heard together and are being disposed of by this common judgment. 2 2. Few facts that are relevant for adjudication of the issues are narrated hereinbelow. The appellant in all these appeals is the State of Maharashtra, through The Dairy Manager, Government Milk Scheme, Chiplun who appointed the respondents herein as daily wagers in the establishment of the dairy on payment of Rs. 81.29 Ps. Per day. The respondents daily wagers have been in service of the appellant for a longer period running between 12 to 20 years. As the respondents were not granted permanancy in serbvice, they filed a complaint before the Industrial Court under Item 5,6 and 9 of Scheduled IV of the M.R.T.U. & P.U.L.P. Act 1971. It was contended before the Industrial Court that the daily wagers were not granted permanency with an object to deprive them of the benefits of permanencny which is an unfair labour practice. It was also contended that the daily wage employees are entitled to permanency on account of they having put in 240 days of service in the preceeding year. The appellants herein opposed the claim by filing a written statement. The appellant State averred in the written statement that there do not exist sanctioned vacant posts for grant of permanency to the daily wagers. It is specifically averred that only if sanctioned posts exist , then and then alone request for permancncy could be considered and in the absence of sanctioned vacant posts, it is impermissible to direct conferment of status of permanency on the daily wagers. 3 Completion of 240 days by itself would not entitled the daily wagers to claim permanency. It is also pleaded by the appellant that the daily wagers are not entitled to permanency and that the appellant has not committed any unfair labour practice. 3. The Industrial Court has on appreciation of facts recorded a finding that there does not exist sanctioned vacant posts. However it observed that : “it is for the Respondent (Dairy Manager) to send proposal to the Government for sanction of the said posts by the Government. There is no any averment in the affidavit of respondent or stand taken in the written statement that such a proposal for sanction of the post has been sent by the respondent to Government but no sanction is accorded by the Government. Unless a proposal is sent, the Government will not suo moto accord sanction to these posts. I do not find any justified reason on the part of the respondent for denying the benefits of permanency.” It is thus clear that the Industrial Court expected the Dairy Manager to forward a proposal to the Government and seek sanction to the posts with a view to accommodate the daily wagers. Fact remains that no sanctioned vacant posts exists as of now. Despite recording the said finding, it concluded that the State has indulged in committing an unfair labour practice. it also held that the daily wagers being engaged for years together, ought to have been granted permancney and 4 having not so done, faulted the State Government. It is held by the Industrial Court that the Standing orders provide for grant of permanency on completion of 240 days and breach of the Standing orders amount to failure to implement the agreement or settlement. It is on this premise, that the action on the part of the appellant in declining to grant permanency has been faulted with. The Industrial Court after declaring that the appellant has indulged in unfair labour practice, has issued direction to the Appellant, forthwith to cease and desist from engaging in such unfair labour practices. A further direction is issued to grant permanency to all the complainants from the date of completion of 240 days of their service and extend all benefits of permanency. 4. The order passed by the Industrial Court was challenged by filing a Writ Petition before the learned Single Judge of this Court. The appellant had contended before the learned Single Judge that in the absence of sanctioned posts and available vacancies to accommodate the daily wagers, issuance of direction by the Industrial Court to grant permanency is contrary to the law laid down by the Supreme Court in case of Secretaries, State of Karnataka & ors. Vs. Umadevi & ors. Reported in (2006) 4 SCC 1. The said submission was turned down by recording the following reasons. 5 “In the present case, admittedly, the resposndent workmen were employed in the Dairy run by the Government Milk Scheme. The Dairy is a factory, employing more than 50 emoployees. Consequently, the Industrial Employment (standing orders) Act would be applicable to the undertaking. There are no Certified Standing Orders aopplicable to the Dairy and, therefore, the Model Standing Orders would govern the employment of the workmen of the undertaking. Under the Model Standing Orders, the employees are entitled to be made permanent after they complete 240 days in service. Therefore, in my view, Uma Devi's case does not apply to the facts and circumstances in the present case. The Supreme Court was not dealing with an industrial establishment to which the Industrial Employement (Standing Orders) Act applies.” 5. Being aggreived by the impugned order passed by the learned Single Judge dated 10th July 2007, the present Letters Patent Appeals are filed. 6 6. The learned Assistant Government Pleader has contended that the Industrial Court so also the learned Single Judge has erred in law in granting permanency to the daily wagers though there are no sanctioned posts available and vacant for accommodating the deaily wagers. It is submitted that the issue involved in these Appeals is squarely covered by the Constitution Bench judgment of the Supreme Court in Uma Devi' s case. It is also submitted that from the very nature of the appointment of the respondents i.e. `Daily Wagers' is indicative of the fact that the respondents were not appointed after following the prescribed procedure for making appointments in public employment and thus there is no legal right in the respondents to claim permanency. 7. It is further submitted that the Constitutional Scheme of public employment regulated by Articles 14, 16 and Rules framed under Article 309 is the only mode of public employment which confer a legal right on the employee qua the post and daily wagers having been appointed without undergoing a selection process cannot claim any right. It is then submitted that a daily wager has no legal right to the post as he does not hold any post. In the submission of the learned AGP, directing grant of permanency to the respondents results in imposing unnecessary 7 financial burden on the State. It is also submitted that there are 778 daily wagers in the Dairy department and if the respondents are to be granted permanency, the others will have to be treated at par. Lastly it is submitted that the learned Single Judge has erred in law in relying upon the Model Standing Orders for conferring the benefit of permanancy on the respondent without noticing the legal position that the Model Standing Orders are always subject to the constitutional scheme of public employment which in turn presupposes a right of equal participation for all. 8. The learned counsel appearing for the respondent on the other hand contended that the respondents are serving as daily wagers for a long period, from 12 years to 20 years with the appellant which clearly indicates that there does exist available work and the only reason for not creating additional posts and in not granting permanency to the respondents is to deprive them of all the benefits of permanency. It is also submitted that the Model Standing Orders which regulates service conditions provides for granting permanency on completion of 240 days. It is also submitted that the Industrial Court and the learned Single Judge having found that the respondents are entitled to grant of permanency, the orders impuged be not interfered with. On the strength of long period of service haing been put in by the daily wagers the doctrine of 8 legitimate expectation is also pressed in service. 9. Before we proceed to deal with the submissions made by the learned counsel for the respective parties, it would be appropriate to formulate the legal issues that emerge for consideration: a) Whether the Constitutional scheme of public employment contained in Articles 14 , 16 and the rules framed under Article 309 of Constitution of India regulate the appointments in the Government Milk Scheme? and if yes, what is the effect of non- compliance thereof on the appointments of the respondents ? b) Whether the provisions of the Model Standing Orders, which regulate the terms and conditions of service are subject to the Rules regulating the selection and appointment contained in the scheme of “Public Employment”? c) Whether “Daily Wagers” have any legal right to claim permanency more so in the absence of `sanctioned vacant post' in the establishment? 9 10. The learned counsel for the appellant has placed reliance on the judgment in the case of Secretary, State of Karnataka and ors. Vs. Umadevi & ors. reported in (2006) 4 SCC 1. The said judgment is an authoritative pronouncement of law by the Constitution Bench of the Supreme Court rendered after careful consideration of the entire law on the subject and in the concluding paragraph, the Supreme Court has observed thus: Para 54: “ It is also clarified that those decisions which run counter to the principle settled in this decision, or in which directions running counter to what we have held herein, will stand denuded of their status as precedents.” The Supreme Court has in the said judgment considered various aspects of public employment and the obligation on the State in making appointments to the posts in public employment. After referring to the Constitutional provisions dealing with public employment more particularly, Articles 14, 16 and the Rules framed under Article 309, the Supreme Court has held that the Principle of `equality of opportunities' in public employment is the basic structure/feature of the constitution, It is then held that the only mode recognised by law in making appointment to the posts in public employment is the one which provides equal opportunity for all. It is also held that no other method of 10 appointment in public employment either by grant of permanency or absorption to temporary, contractual, casual, daily wages or adhoc employees appointed or recruited dehouse the constitutional scheme of public employment is permissible and hence cannot be legalised. The judgment further proceeds to hold that casual labourers/daily wagers have no right to regular or permanent public employment and that such persons who choose to accept the same accepts it fully knowing the nature of employment and hence the court rejected the application of doctrine of legitimate expection. The judgment emphasis that persons who get employed without following regular procedure or even through back door or on daily wages cannot seek direction from the court to make them permanent in the post and to prevent regular recruitment to the posts concerned. Such employment is termed as “litigious employment”. It is also held that a total embargo on temporary employment is not possible, given exigencies of administration, however such appointees cannot claim parity with permanent employment. The judgment criticises the orders passed by various courts directing absorption, regularisation or permanent continuance, unless the recruitment itself was made regularly and in terms of the Constitutional Scheme. It emphasis that regular recruitment should be insisted 11 upon and the State should not be allowed to depart from the normal rule and indulge in making adhoc appointments in permanent posts. 11. Reliance is placed by the learned counsel for the appellant on the following paragraphs of the judgment reported in (2006)4 SCC 1: Para 4: “ Regular appointment must be the rule. But sometimes this process is not adhered to and the constittional scheme of public employment is by passed. The union, the States, their departments and instrumentalities have resorted to irregular appointments, especially in the lowe rungs of the service, without reference to the duty to ensure a proper appointment procedure through the Public Service Commissions or otherwise as per the rules adopted and to permit these irregular appointees or those apopointed on contract or on daily wages, to continue year after year, thus, keeping out those who are qualified to apply for the post concerned and depriving them of an opportunity to compete for the post. It has also led to persons who get employed, without the following of a regular procedure or even through the backdoor or on daily wages, approaching the courts, seeking directions to make them permanent in their posts and to prevent regular recruitment to the posts concerned. The courts have not always kept the legal aspects in mind and have occasionally even stayed the regular process of employment being set in motion and in some cases, even directed that these illegal, irregular or improper entrants be absorbed into service. A class of employment which can only be called “litigious employment”, has risen like 12 a phoenix seriously imparing the constitutional scheme. 6: The power of a State as an employer is more limited than that of a private employer inasmuch as it is subjected to constitutional limitations and cannot be exercised arbitrarily. Article 309 of the Constitution gives the Government the power to frame rules for the purpose of laying down the conditions of service and recruitment of persons to be appointed to public services and posts in connection with the affairs of the Union or any of the States. That article contemplates the drawing up of a procedure and rules to regulate the recruitment and regulate the service conditions of appointees appointed to public posts. It is well acknowledged that because of this, the entire process of recruitment for services is controlled by detailed procedures which specify the necessary qualifications, the mode of appointment, etc. If rules have been made under Article 309 of the Constitution, then the Government can make appointments only in accordance with the rules. The State is meant to be a model employer. 43: Thus, it is clear that adherence to rule of equality in public employment is a basic feature of our Constitution and since the rule of law is the core of our Constitution, a court would certainly be disabled from passing an order upholding a violation of Article 14 or in ordering the overlooking of the need to comply with the requirements of Article 14 read with Article 16 of the Constitution. Therefore, consistent with the scheme for public employment, this Court while laying down the law, has necessarily to hold that unless the apopointment is in terms of the relevant rules and after a proper competition among qualified persons, the same would not confer any right on the appointee. If it is a contractual appointment, the appointment comes to 13 an end at the end of the contract, if it were an engagement or appointment on daily wages or casual basis, the same would come to an end when it is discontinued. Similarly, a temporary employee could not claim to be made permanent on the expiry of his term of appointment. It has also to be clafiried that merely because a temporary employee or a casual wage worker is continued for a time beyond the term of his appointment, he would not be entitlted to be absorbed in regular service or made permanent, merely on the strength of such continuance, if the original appointment was not made by following a due processof selection as envisaged by the relevant rules. It is not open to the court to prevent regular recruitment at the instance of temporary employees whose period of employment has come to an end or of ad hoc employees who by the very nature of their appointment, do not acquire any right. The High Courts acting under Article 226 of the Constitution, should not ordinarily issue directions for absorption, regularisation, or permanent continuance unless the recruitment itself was made regularly and in terms of the constitutional scheme. Merely because an employee had continued under cover of an order of the court, which we have described at “litigious employment” in the earlier part of the judgment, he would not be entitled to any right to be absorbed or made permanent in the service. 45. While directing that appointments, temporary or casual, be regularised or made permanent, the courts are swayed by the fact that the person concerned has worked for some time and in some cases for a considerable length of time. It is not as if the person who accepts an engagement either temporary or casual in nature, is not aware of the nature of his employment. He accepts the employment with open 14 eyes. It may be true that he is not in a position to bargain – not at arm's length – since he might have been searching for some employment so as to eke out his livelihood and accepts whatever he gets. But on that ground alone, it would not be appropriate to jettison the constitutional scheme of appointment and to take the view that a person who has temporarily or casually got employed should be directed to be continued permanently. By doing so, it will be creating another mode of public appointment which is not permissible. If the court were to void a contractual employment of this nature on the ground that the parties were not having equal bargaining power, that too would not enable the court to grant any relief to that employee. A total embargo on such casual or temporary employment is not possible, given the exigencies of administration and if imposed would only mean that some people who at least get employment temporarily, contractually or casually, would not be getting even that employment when securing of such employment brings at least some succor to them. After all, innumerable citizens of our vast country are in search of employment and one is not compelled to accept a casual or temporary employment if one is not inclined to go in for such an employment. It is in that context that one has to proceed on the basis that the employment was accepted fully knowing the nature of it and the consequences flowing from it. In other words, even while accepting the employment, the person concerned knows the nature of his employment. It is not an appointment to a post in the real sense of the term. The claim acquired by him in the post in which he is temporarily employed or the interest in that post cannot be considered to be of such a magnitude as to enable the giving up of the procedure established, for making regular appointments to available posts in the services of the State. 15 47. When a person enters a temporary employment or gets engagement as a contractual or casual worker and the engagement is not based on a proper selection as recognised by the relevant rules or procedure. He is aware of the consequences of the appointment being temporary, casual or contractual in nature. Such a person cannot invoke the theory of legitimate expectation for being confirmed in the post when an appointment to the post could be made only by following a proper procedure for selection and in cases concerned, in consultation with the Public Service Commission.” 12. The next judgment on which reliance is placed by the counsel for the appellant is the one reported in the case of M.P. Housing Board & anr. Vs. Manoj Shrivastava reported in (2006) 2 SCC 702. The Supreme Court has categorically held that `daily wager' does not hold the post or derive any legal right in relation thereto, unless he is appointed (1) against a duly sanctioned vacant post, and (2) upon following the statutory law operating in the field. If the appointment is made in contravention of either of the two requirements such appointment would be void and such appointment does not confer any legal right on the appointee. Reliance is placed on the following paragraphs of the said judgment: “8. A person with a view to obtain the status of a “permanent employee” must be appointed in terms of the statutory rules. It is not the case of the respondent that he was appointed against a vacant post 16 which was duly sanctioned by the statutory authority or his appointment was made upon following the statutory law operating in the field. 10. It is one thing to say that a person was appointed on an ad hoc basis or as a daily wager but it is another thing to say that he is appointed in a sanctioned post which was lying vacant upon following the due procedure prescribed therefore. 15. A daily wager does not hold a post unless he is appointed in terms of the Act and the Rules framed thereunder. He does not derive any legal right in relation thereto. 17. It is now well settled that only because a person had been working for more than 240 days, he does not derive any legal right to be regularised in service.” 13. The above legal position is summarised and restated concurring with the view taken in the case of Mahendra L. Jain & ors. Vs. Indore Development Authority and ors. Reported in (2005)1 SCC 639. In the said case it has been held that the Standing orders governing the terms and conditions of service must be read subject to the constitutional limitations wherever applicable. This judgment precisely considers the status of daily wagers and proceeds to hold that daily wagers do not hold any posts and in the absence of sanctioned posts, no permanency can be granted. In para 31, it is held that : 17 “The Standing Orders governing the terms and conditions of service must be read subject to the constitutional limitations wherever applicable. Constitution being the suprema lex, shall prevail over all other statues.” 14. The next judgment on which reliance is placed by the learned AGP is in the case of M.P. State Agro Industries Development Corpn.Ltd. & anr. Vs. S.C. Pandey reported in (2006) 2 SCC 716. This judgment reiterates that completion of 240 days continuance service does not by itself confer any legal right for permanency. It is also considered in the said judgment that if two statues are governing the employment, one dealing with selection and appointment and the other relating to the terms and conditions of service, an endeavour should be made to give effect to both the statutes. However, it is clarified that daily wager does not hold any post as he is not appointed in terms of the provisions of the Act and the Rules framed thereunder and in that view of the matter, he does not derive any legal right. The Supreme Court has held in paragraphs 17, 18 and 22 thus: “17. The question raised in this appeal is now covered by a decision of this Court in M.P. Housing Board V. Manoj Shrivastava wherein this court clearly opined that : (1) when the conditions of service are governed by two statutes: one relating to selection 18 and appointment and the