IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.7789 of 2011 1. Annapurna Sinha W/o Shri Rajnish Onkar, resident of House no. 29, Road no. 21, Rajiv Nagar, Dist. Patna. ---Petitioner Versus 1. The State Of Bihar 2. The Principal Secretary Road Construction Department, Government of Bihar, Patna. 3. The Principal Secretary Personnel and Administrative Reforms Department, Government of Bihar, Patna. 4. The Chairman, Bihar State Road Development Corporation Ltd. RCD, Government of Bihar. 5. The Managing Director, Bihar State Road Development Corporation Ltd. RCD, Mechanical Work Shop Campus (Near Airport), Sheikhpura, Patna. 6. The Deputy General Manager (Technical), Bihar State Road Development Corporation Ltd. RCD Mechanical Work Shop Campus (Near Airport), Sheikhpura, Patna ---Respondents. For the Petitioner : Mr. Chandrashekhar Singh, Sr. Adv. & Mr. Yashraj Bardhan Adv. For the Road Corporation : Mr. Vikash Kumar, Advocate. -------- 07 06.09.2011 Petitioner approached this Court for issuance of appropriate writ(s)/order(s) to quash the letter dated 31.01.2011 (Annexure-5) issued by the Deputy General Manager (Administration) of the Bihar State Road Development Corporation Limited ( for short the ‘Corporation’) informing her that on expiry of period of one year of appointment offered to her on contract basis she is required to make over all the government files, bills and articles in her possession to another officer of the respondent Corporation. She has also prayed for issuance of a mandamus commanding the respondents for continuance of her service as Company Secretary and to pay the emolument lying in arrear as she was paid a consolidated amount of Rs. 25,000/- only as per the 2 terms of engagement although the respondents were obliged to fix her emoluments between Rs. 30,000/- to 35,000/-. Although specifically not prayed for in the writ petition learned counsel for the petitioner, in course of argument, also prayed for a direction upon the respondent Corporation to fill up the post of Company Secretary on regular/substantive basis. Heard Mr. Chandra Shekhar Singh, learned senior counsel in support of the writ petitioner and Mr. Vikash Kumar on behalf of the respondent Corporation. Supplementary affidavit, counter affidavit and rejoinder to the counter affidavit have been filed which are on record. Background facts, in a nutshell, are as under:- The Corporation has been established in recent past as Government of Bihar undertaking to boost the pace of infrastructural development, especially in Road Sector. An advertisement no. BSRDC- 01/2009 (Annexure A to the counter affidavit) was published inviting application(s) for appointment on contract basis on certain posts including the Company Secretary. In the said advertisement, it was clearly mentioned that appointment is on contract basis and only for period of 01 year which was extendable for further 05 years at the discretion of the Corporation considering satisfactory performance of the candidate/appointee. Against each post, fixed emolument payable per month for one year was also indicated. For the post of Company Secretary the fixed emolument was Rs. 25,000/- to 30,000/- per month. The petitioner applied for the above post of 3 Company Secretary which was followed by interview held on 06.07.2009 whereafter she was declared successful. The petitioner was provided with letter of engagement/appointment dated 18.01.2010 (Annexure-1), which specifically spelt out that the appointment was on contract basis for one year on fixed emolument of Rs. 25,000/- per month. Petitioner was called upon to execute an agreement for such retention. The petitioner executed an agreement on 01.02.2010 (Annexure C to the counter affidavit). She continued on the said post and on expiry of the period of one year, as per Clause 11 of the agreement, the retention period automatically expired since no order granting renewal was passed. The petitioner was thereafter served with letter as contained in Annexure-5 which has been impugned in the present writ petition. Learned counsel for the petitioner submitted that the advertisement for recruitment under contract for 01 year was renewable up to 05 years. The authorities have not considered her case for renewal of contract which is an arbitrary act of the respondent Corporation. It is also contended that Government in the Department of Personnel and Administrative Reforms came out with a resolution dated 18.07.2002 (Annexure-6) which sets out the conditions for retention /appointment on contract basis. Relying on Clause 2 of the said guideline, it has been argued that such contract appointment can be made only for specific project/scheme temporary in nature, which are not likely to be continued for a longer period of time. It is submitted that post of Company Secretary is provided in the Companies Act, 1956 and the 4 respondent Company being a registered company has to have a Company Secretary on regular/substantive basis. Referring to and relying on Annexure-9 to the supplementary affidavit, it is submitted that after allowing the tenure of her appointment on contract basis to lapse, the respondent Corporation has come up with another advertisement for appointment/retention of Company Secretary on contract basis. It is contended that the Government in the Department of Road Construction by letter dated 05.10.2009 (Annexure-2) conveyed to the Accountant General creation of 138 posts for the Corporation in question which include the post of Company Secretary. In such circumstance, in the submission of the petitioner, the respondent Corporation may be commanded to appoint Company Secretary on regular/ substantive basis. It is forcibly argued that statutory post cannot be allowed to be filled up on contract basis. A Company like the respondent Corporation is required to appoint Company Secretary on substantive/regular basis and in not doing so the respondents have acted arbitrarily and in the teeth of the provision(s) contained in the Company Act. Per contra, the respondents have supported the impugned action. It is contended that the advertisement (Annexure-A to the counter affidavit) pursuant to which the petitioner applied clearly contemplated that appointment/ retention of the personnels were being made on contract basis for a fixed term of 01 years extendable/renewable by 05 years at the discretion of the Corporation and on a fixed remuneration. The petitioner with open eyes applied thereagainst and on being selected she was offered the 5 letter of engagement/appointment on contract basis only after she executed an agreement (Annexure-C to the counter affidavit). The petitioner, therefore, cannot raise a grievance with respect to the letter contained in Annexure-5 which simply informs her that her tenure as Company Secretary expired and as such all the files, bills and articles belonging to the Corporation in her possession be returned/deposited. Learned counsel in this connection relies on the following judgments of the Supreme Court:- (i) (2009)16 SCC 385 (Reji Kumar and ors. Vs. Director of Health Services, Kerala & Ors.) (ii) (2002)10 SCC 583 ( State of Orissa vs. Chandra Sekhar Mishra) (iii) (2006)11 SCC 731 (II) (B. Srinivasa Reddy vs. Karnataka Urban Water Supply & Drainage Board Employees’ Assn. & Ors.) On hearing the rival submissions of the parties with reference to the pleadings on record, it appears that the advertisement itself discloses that the appointment/retention of different personnels including the Company Secretary was/were being made on contract basis on a fixed remuneration and for a fixed term. The petitioner, on being offered the appointment, executed an agreement containing diverse clauses as would appear from Annexure –C to the counter affidavit. Clause 11 states on expiry of tenure of engagement/appointment if not renewed the engagement/appointment shall automatically come to an end and no fresh order therefor shall be required to be passed. Class 3 thereof 6 declares that during the period she is engaged on contract basis, fixed remuneration shall be paid. Subsequent to such engagement/appointment of the petitioner having been made the Corporation came out with Service Regulation 2010 which also provide for engagement/appointment of some personnels including the Company Secretary on contract basis. The terms and conditions of the engagement on contract basis have also been spelt out therein. Petitioner has placed reliance on letter dated 05.10.2009 (Annexure-2). It appears from perusal thereof that the posts created for smooth functioning of the Corporation include certain posts for which the employment/appointment is/are required to be made on contract basis. The post of Company Secretary is one of these posts. Petitioner has also relied on the resolution of the Government dated 18.07.2002 (Annexure-6) in order to contend that such engagement on contract basis is contrary to the said guidelines. On close scrutiny of Annexure-6, particularly clause 2(2) thereof it is seen that it does provide for appointment on contract basis even against the sanctioned post but for maximum period of 01 year. I have already noticed that the service Regulation of the Corporation also provide for appointment on contract basis. While dealing with the rights of such appointee on contract basis the Supreme Court in Reji Kumar (Supra) held in para 7 thereof as under:- “7. Even otherwise, when the appointment itself is for a fixed tenure, though the nature of the tenure is a temporary one, the appointment comes to an end after the expiry of the tenure and there would be no relationship of master and servant thereafter 7 until the relationship is continued by a fresh letter of appointment, or by intervention of any court’s order. We are told that when the appellants approached the High Court, the Court had not granted any interim order. By the time they approached the Court the term of one year had expired.” Considering the claim of regularization of a contractual employee the Apex Court in State of Orissa vs. Chandra Sekhar Mishra (supra) observed as under in para 4 of the report. “4. In our opinion, there were two fundamental errors in that relief being granted to the respondent. Firstly, the services of the respondent were terminated with effect from 31.1.1978 and the respondent did not approach the Tribunal within the period of limitation provided by the statute. On this ground alone, the Tribunal should not have entertained the appeal. Secondly the respondent was appointed on 1.2.1972 on contract basis for a period of three years. This period of contract was extended up to 31.1.1978. When the respondent was only a contractual employee, there could be no question of his being granted the relief of being directed to be appointed as a regular employee.” In B.Srinivasa Reddey (Supra), the Hon’ble Supreme Court was considering the challenge to the appointment of the post of Managing Director of Karnataka Urban Water Supply and Drainage Board on contract basis. The post was found to be the statutory post. While considering the powers of the Government in 8 making such appointment it was held that the Government has unrestricted power to make contractual appointment. Such view was taken based on P.K. Sandhu v. Shiv Raj V. Patil (1997)4 SCC 348 wherein the Supreme Court held that the power to make appointment includes the power to make appointment on substantive basis, temporary, officiating basis, ad hoc basis, daily wages or contractual basis. In para 81 of the said report, the Hon’ble Court, noticed the ratio laid down in Satish Chandra Anand vs. Union of India (AIR 1953 SC 250) which dealt with a case of a contract appointment terminable by notice under one of its clauses and held that Articles 14 and 16 had no application as the incumbent was not denied equal opportunity in a matter relating to appointment or employment who had been treated just like any other person to whom an offer of temporary employment under these conditions was made. The Apex Court further observed as under:- “The State can enter into contracts of temporary employment and impose special terms in each case, provided they are not inconsistent with the Constitution, and those who choose to accept those terms and enter into the contract are bound by them, even as the State is bound.” Keeping those propositions of law in focus, if the facts of the present case are scanned, it would appear that the advertisement itself was made for engagement/appointment on contract basis on a fixed term/tenure and for a fixed remuneration. The petitioner with 9 her eyes open applied thereagainst and on being selected was retained for 01 year as per the agreement reached by and between them. The petitioner thus cannot be allowed to submit that the respondents have acted arbitrarily in not considering her case for further renewal. In the said background this Court is not dealing with the pleadings made by the parties on such consideration. Suffice it to note that the respondents have come out with a case that such consideration was made before taking the impugned action and the respondents, acting in their own discretion, did not find it a fit case for extending the period of retention on contract basis by making a fresh order of engagement and/or renewal in her favour. The submission of the petitioner made in this regard is, therefore, found not sustainable in law. In fairness to the learned counsel for the petitioner this Court now proposes to deal with the case cited at Bar. Learned counsel for the petitioner referred to and relied upon a case reported in 2010 (2) PLJR 777 (Raj Mohan Sah & Anr. Vs. The State of Bihar & Ors.) wherein a learned Singh Judge of this Court dealing with appointment made on contract basis after adopting selection procedure prescribed therefor held that the incumbents shall be treated as regular appointee from the date of their appointment although it was coined as contractual. Para 12 of the said case would show that the factual background in which said judgment was rendered was/were entirely different. It is apposite to quote, in extensor, para 12 of the report which is as under:- “12, Had the petitioners been on contract basis simpliciter, the 10 matter may have been different. On the contrary, the petitioners applied in response to a regular advertisement, underwent a regular process of competitive selection, the procedures which are otherwise followed in accordance with Article 14 of the Constitution of India before providing regular employment in a Government service. These basic requirements mandated by the constitution have been fulfilled by the petitioners. Therefore, in so far as the procedure for selection is concerned, they stand at par with the one selected and appointed on regular basis.” I now advert to another submission of the petitioner that she is entitled to get remuneration for the period she worked on contract basis as per salary structure indicated in letter dated 05.10.2009 (Annexure-2). It is contended that for the post of Company Secretary, even on contract basis, it has been indicated therein that anticipated pay/remuneration for the said post is 30,000/- to 35,000/-. It is the claim of the petitioner that she is entitled to be paid at least 30,000/- per month as remuneration for the period she discharged her duties on contract basis as the Company Secretary of the Corporation. The respondents acted in wholly unjust and arbitrary manner in paying her the fixed remuneration @ of 25,000/- per month. Buttressing the said argument, it has been contended that if the post carried remuneration between 30,000/- to 35000/- the respondent(s) taking advantage of the unequal bargaining position of the petitioner paid her only a consolidated amount of Rs. 25000/-. The respondents, on 11 the other hand, have taken a stand that in the advertisement itself (Annexure-A) it was indicated that the emolument would be between 25,000/- to 30,000/-. Since the petitioner continued for one year she was paid the fixed emolument as per advertisement at the rate of 25,000/- only. It is again highlighted that in such matter parties shall be governed by the terms and conditions of the contract. The petitioner after having accepted the aforesaid position applied and was interviewed and thereafter offered the engagement/ appointment on a fixed remuneration which was duly accepted by her. Having discharged duties and received the said remuneration, it would be unjust on the part of the petitioner to raise the said grievance. Considering the status of an employee on contract basis as also the terms and conditions of the agreement this Court does not find any illegality in the stand of the respondents. The said submission of the petitioner is also held not sustainable in law. For the reasons noted above, this Court does not find any merit in the application. It is, accordingly, dismissed. There shall be no order as to costs. Sym ( Kishore K. Mandal, J.)