STATE OF U.P. AND ANR.

GIRISH BIHARI AND ORS.

FEBRUARY 14, 1997

[AM. AHMADI, CJ., SUJATA V. MANOHAR AND

K. VENKATASWAMI, JJ:)

Service Law :

All India Service (Death-cum-Retirement Benefits) Rules, 1958, R. 16. C

Service-Extension ofef ore superannuation-Cancellation of extension before it actually came into effect-Held : Such cancellation of extension, not invalid.

Evidence Act, 1872 : Section 115 :

Estoppel-Applicability of-Party pleading estoppel did not alter his position-Held : Plea of estoppel, rejected.

Administrative law :

Natural justice-Audi alteram partem-Hearing-Gralit of-Order of extension of serviceyond superannuation-cancellation of extension before in actually came into effect-Held : Retiring employee had no vested right-Hence, it was not necessary to grant him hearing before cancellation of extension order.

The respondent, a member of the Indian Police Service, was to retire

on superannuation. The Governor passed an order for extension of the service of the respondent for six months from the date of his retirement under Rule 16 of the All India Services (Death-cum-Retirement Benefits) Rules, 1958. Subsequently, the Governor cancelled his earlier order of extension before it actually came into effect. The respondent challenged the G aforesaid order before the Central Administrative Tribunal on the grounds that the order granting extension had created a vested right in the respondent to continue for a period of six months; that the order of cancellation of extension passed without an opportunity to the respondent of being heard, was vitiated on account of violation of the principles of H

A natural justice. The Tribunal allowed the petition of the respondent. Hence

this appeal.

On behalf of the respondent the principle of Estoppel was pleaded.

Allowing the appeal, this Court

HELD : 1.1. Till the order of extension of service could become operative, on right under the order had vested in the incumbent. It was, therefore, not necessary to grant him hearing before the extension order was cancelled. The respondent did not ask for an extension. It was C unilateral action on the part of the State/appellant. The respondent may or may not have accepted the offer. Till the order come into force no vested right could have arisen. If the order of extension did not create any right, the cancellation order could not have withdrawn any such right. Hence, the question of right to hearing did not arise and there is no violatio~ of rules of natural justice. [58-F-G] D Sharwan Kumar !ha v. State of Bihar, [1991) Supp. 1 SCC 310 and Scheduled Caste and Weaker Section Welfare Association v. State of Karnataka, [1991) 2 sec 604, held inapplicable.

State of Maharashtra & Anr. v. Lok Shikshan Sansatha & Ors., [1971) E 2 sec 410, cited. •·

1.2. There is no statutory estoppel in favour of the respondent. The respondent did not plead that the he altered his position in any way on account of the extension order and hence the subsequent order of cancel- F lation could not have prejudiced the respondent in any way. The principle of estoppel is not attracted in this case. [58-H, 59-A]

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 795 of 1997.

From the Judgment and Order dated 21.5.96 of the Central Administrative Tribunal at Lucknow Bench in O.A. No. 162 of 1996. ·

Altaf Ahmed, Additional Solicitor General, H.N. Salve, M.C.

Dhingra_ and P.C. Verma for the Appellants.

H In-person for Respondent No. 1.

-~-

STATEv. GIRISHBIHARI [AHMADI, CJ.) 55

The Judgment of the Court was delivered by A

AHMADI, CJI. Leave granted.

The respondent Dr. Girish Bihari, a member of the Indian Police Service, was to reach the age of Superannuation on 5th March, 1996 and therefore was to retire from service with effect from the afternoon of B 31.3.1996 i.e. on the last date of the month in which he reached that age.

On 20th March, 1996, the Governor, State of Uttar Pradesh by an order under Rule 16 of All India Services (Death-cum-Retirement benefits) Rules, 1958 (hereinafter referred to as "the Rules") passed an order for extension of the service of Dr. Girish Bihari for 6 months from the date of C his retirement i.e. 31.3.1996. On 23rd March, 1996, the Governor in exercise of powers under Section 21 of the General Clauses Act issued the impugned order cancelling the earlier order dated 20th March, 1996 granting extension to the appellant.

The surrounding circumstances of the case are as under :

. On 18th October, 1995, under a proclamation issued under Article 356 of the Constitution by the President, the President assumed to himself

all functions of the Government as well as the powers vested in or exercisable by the Governor. Having assumed powers under Article 356, the E President by a further notification authorised the Governor to exercise all powers by himself on his behalf. On 19th March, 1996 the Election Commission announced elections to the State Legislature and issued instructions kiiown as 'Model Guidelines for the Government'. On 20th March 1996, the Election Commission sent out messages to the Chief Secretaries F about announcement of general elections to the House of People and Legislative Assemblies inter alia mentioning therein that the standing instructions of the Commission including ban on transfers, etc., have come into force. The Chief Electoral Officer was of the view that the order retaining the respondent beyond the date of superannuation required the prior consent of the Election Commission. The Election Commission G directed that the order dated 20th March, 1996, granting extension to the respondent be revoked as it was violative of the Model Code of Conduct issued by the Commission. The Governor sought advice from the Advocate General and thereafter by the impugned order cancelled the order dated 20th March, 1996. The respondent challenged the impugned order before H

SUPREME COURT REPOR'VS

[1997] 2 S.C.R.

A the Central Administrative Tribunal inter alia on the grounds that the Governor instead of acting on his fair judgment acted under pre-emptory direction of the Election Commission and therefore, the impugned order was bad; that the order dated 20th March, 1996 had created a right to continue for a period of 6 months and therefore the impugned order B passed without an opportunity to the appellant of being heard was vitiated on account of violation of the principles of natural justice. The petition was defended by the appellant State of Uttar Pradesh on the ground that there was no infirmity in the order as the Governor had used his own judgment and discretion in a fair manner after obtaining constitutional advice under Article 156(2) of the Constitution of India anci that the impugned order C was to be operative with effect from 1.4.1996 and therefore till then the order had not created any vested right of any kind in the respondent.

The Tribunal returned findings on all the substantial questions in favour of the appellant and against the respondent. The Tribunal held that D the letter 20th March, 1996 granting extension to the .respondent did not create any vested right nor was the protection under Article 311(2) of the Constitution of India available in the circumstances of the case as the order of cancellation of extenson was not passed by way of any disciplinary action. The Tribunal further held that the advice and direction of the E Election Commission were not without jurisdiction, nor was the order of cancellation of extension based on extraneous considerations. The Tribunal held that the impugned order dated 23rd March, 1996 was not arbitrary or violative of Articles 14 and 16 of the Constitution. The Tribunal, however, observed that the principles of natural justice had not been observed before F passing the order inasmuch as the respondent was not given a hearing before withdrawing the order of extension. The Tribunal observed that the principles of natural justice implied : (i) the principles of audi alteram partem; and (ii) justice should not only be done but must also manifestly appear to be done. The Tribunal said :

"It is well settled that an administrative decision which results in adverse civil consequences, must follow the principles of natural justice. In the present case while it is true that any vested right did not accrue to the applicant, before 1.4.1996, it cannot be denied that the benefit which accrued to him by the order of extension dated 20.3.96 was withdrawn rather abruptly within a period of '

three days on 23.3.96 without giving him a show cause or an A opportunity for hearing. We therefore, are of the considered view that there has been violation of principles of natural justice in the present case."

The Tribunal referred to a few judgments on the aspect of the B application of the principles of natural justice in the context of administrative law. The State of Maharashtra and Another v. Lok Shikshan Sansatha and Others, (1971) 2 SCC 410 was cited by the State. The two decisions which are referred to by the Tribunal in support of its decision are Shrawan Kumar !ha v. State of Bihar, [1991] Supp. 1 310 and Scheduled Caste and Weaker Section Welfare Association v. State of Karnataka, [1991] 2 SCC 604. C In Shrawan Kumar's case, 175 candidates were appointed as Assistant Teachers but before they could join the Deputy Development Commissioner cancelled the orders of appointment on the ground that the District Superintendent of Education, Dhanbad, who issued the orders of appointment, had no authority to make the appointments. A Division Bench of this D Court comprising Kuldip Singh and K. Ramaswamy, JJ. observed that the candidates should have been given an opportunity of hearing before their appointments were cancelled. The Court accordingly directed the Solicitor General to ask the Secretary (Education), Government of Bihar to grant an opportunity of hearing to the candidates and to give a finding as to whether they were validly appointed as Assistant Teachers. The Court also E ordered that if anyone had actually worked as a Teacher, he or she would be entitled to the salary for that period. It is interesting to note that this Court while directing that a hearing be given to those appointed as Assistant Teachers did not grant any relief in terms of actual appointment in pursuance to the appointment letters. Nor did the Court order for any F pecuniary benefits being given to those appellants pursuant to the appointment letters. Salary, etc., were ordered to be paid only in case anyone of those candidates had actually joined and worked. The Tribunal, however has gone much further by holding that the respondent would be deemed to have continued in service after retirement in pursuance to the extension order. G

In Scheduled Caste and Weaker Section Welfare Association's case (supra), the State of Karnataka had issued a notification in, respect of certain area as the salum area, under Section 3 of the Karnataka Slum (Improvement & Clearance) Act and subsequently after hearing objections H

A declared the entire area as slum clearance area under Section 11 of the same Act but later after about three years cancelled the earlier notification and redeclared only a much smi/-ller area as slum area. The residents of the area not covered by the last notification of slum area contended that they had been deprived of the benefits of the Act in violation of the

B principles of natural justice and Article 14 of the Constitution. One of the points which came up for consideration in the case was of the principles of natural justice. The notifications under Section 3 and Section 11 of the Karnataka Slum (Clearance & Improvement) Act which provided for declaration of areas as slum areas and as slum clearance areas respectively, affected the rights of the inhabitants of that area. This Court held that when C any alteration was sought to be made in the original scheme, it became incumbent upon the authorities to give an opportunity to the persons who had been affected by the earlier order and were required to adopt a certain course. of action. This case is clearly distinguishable on facts. The Tribunal itself has held that the order of extension of service did not create any right D and had been cancelled before the date the order came into operation.

Consequently, the respondent was not affected either by the order of extension or by the order cancelling the extension. In contrast, in Scheduled Caste & Weaker Sectio11 Welfare Associatio11's case (supra), the Court held that the rights of the inhabitants of the concerned areas were affected by

E declaration under Sections 3 and 11 as well as by any change in the , declared policy.

In the face of the Tribunal's own findings that till the order of extension of service could become operative, no right under the order had vested in the incumbent, it is difficulN:o agree that thcre still was a necessity F togrant him hearing before the extension order was cancelled. The respondent did not ask for an extension. It was a unilateral action on the part of the State/appellant. The respondent may or may not have accepted the offer. Till the order came into force, as correctly observed by the Tribunal, no vested right could have arisen. If the order of extension did not create any right, the cancellation order could not have withdrawn any such right.

G Hence, the question of right to hearing did not arise and we see no violation of rules of natural justice.

Before this Court, the principle of estoppel was pleaded on behalf of the respondent. Again there is no basis on which any such plea can be H Liken. There is no statutory estoppel in favour of the respondent. The

respondent does not say that he altered his position in any way on account A of the extension order dated 20th March, 1996 and hence the subsequent order of 23.3.1996 could not have prejudiced him in any way. We do not see how the principle of estoppel can be attracted to this case.

On the above premises, the judgment of the Tribunal has to be set aside and the order dated 23rd March, 1996 must be upheld. The appeal B is allowed but we make no order as to costs.

v.s.s.

Appeal allowed.