REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
CONTEMPT PETITION (CIVIL) NO. 771 OF 2015
IN
SPECIAL LEAVE PETITION (C) NO. 25284 OF 2012
|RAM NARESH RAWAT |.....PETITIONER(S) |
|VERSUS | |
|SRI ASHWINI RAY & ORS. |.....RESPONDENT(S) |
W I T H
CONTEMPT PETITION (CIVIL) NO. 838 OF 2015
IN
SPECIAL LEAVE PETITION (C) NO. 9635 OF 2013
CONTEMPT PETITION (CIVIL) NO. 858 OF 2015
IN
SPECIAL LEAVE PETITION (C) NO. 23985 OF 2012
CONTEMPT PETITION (CIVIL) NO. 62 OF 2016
IN
SPECIAL LEAVE PETITION (C) NO. 31343 OF 2011
CONTEMPT PETITION (CIVIL) NOS. 82-85 OF 2016
IN
SPECIAL LEAVE PETITION (C) NOS. 18245 OF 2014, 18246, 18247 & 18249 OF 2014
CONMT.PET.(C) NO. 101/2016 IN SLP(C) NO. 19220/2014
CONMT.PET.(C) NO. 787/2015 IN SLP(C) NO. 19224/2014
CONMT.PET.(C) NO. 788/2015 IN SLP(C) NO. 19286/2014
CONMT.PET.(C) NO. 819/2015 IN SLP(C) NO. 19217/2014
CONMT.PET.(C) NO. 823/2015 IN SLP(C) NO. 19218/2014
CONMT.PET.(C) NO. 856/2015 IN SLP(C) NO. 19230/2014
CONMT.PET.(C) NO. 121-131/2016 IN SLP(C) NO. 8473/2012, 19394/2012,
23980/2012,23981/2012, 23986/2012, 34868/2012, 38228/2012, 38231/2012,
38235/2012, 38236/2012, 19236/2014.
CONMT.PET.(C) NO. 735/2015 IN SLP(C) NO. 19278/2014
CONMT.PET.(C) NO. 793-817/2015 IN SLP(C) NO.20025/2011 AND 19396/12,
SLP(C) NO. 30275/2012, SLP(C) NO. 30276/2012, SLP(C) NO. 1577/2013, SLP(C)
NO. 5597/2013, SLP(C) NO. 29683/2013, SLP(C) NO. 19095/2014, SLP(C) NO.
19282/2014, SLP(C) NO. 19251/2014, SLP(C) NO. 25279/2012, SLP(C) NO.
12438/2013, SLP(C) NO. 12433/2013, SLP(C) NO. 5350/2013, SLP(C) NO.
19221/2014, SLP(C) NO. 19260/2014, SLP(C) NO. 19257/2014, SLP(C) NO.
19206/2014, SLP(C) NO.25277/2012, SLP(C) NO. 19094/2014, SLP(C) NO.
19205/2014, SLP(C) NO. 19219/2014, SLP(C) NO. 19237/2014, SLP(C) NO.
19246/2014 AND SLP(C) NO. 19255/2014
CONMT.PET.(C) NO. 215/2016 IN SLP(C) NO. 21830/2012
WITH
CONMT.PET.(C) NO. 216/2016 IN SLP(C) NO. 21835/2012
CONMT.PET.(C) NO. 512/2016 IN SLP(C) NO. 18413/2014
CONMT.PET.(C) NO. 475/2016 IN SLP(C) NO. 8203/2012
CONMT.PET.(C) NO. 536/2016 IN SLP(C) NO. 19393/2012
A N D
CONMT. PET. (C) NO. 106/2016 IN SLP(C) NO. 19292/2012
J U D G M E N T
A.K. SIKRI, J.
All the petitioners who have filed these contempt
petitions were engaged by the State of Madhya Pradesh on different dates
on different posts but all of them were engaged as daily wagers. They
continued as daily wagers for long spell of time. According to the
petitioners, in terms of Madhya Pradesh Industrial Environment (Standing
Order) Rules, 1963, they became entitled to be classified as 'permanent
employees'. However, their demand for classification as permanent
employees was not acceded to by the State, which inaction of the State
Government provoked some of these employees to raise the industrial dispute
for their classification which resulted into award(s) of the labour court
directing their classification as 'permanent'. The labour court also held
that on their classification as permanent, they would be entitled to the
pay-scale of permanent post from dates specified in the award. Appeals
were filed by the State against those orders which were dismissed by the
industrial court and writ petitions also came to be dismissed by the High
Court. This resulted in passing of the orders by the concerned authorities
in the State Government classifying these petitioners as permanent
employees. It was also ordered that they shall be entitled to minimum pay
as fixed by the Labour Commission. This led to another round of litigation
as the petitioners claimed that on their classification as 'permanent' to
their respective posts they were entitled to receive the pay-scale attached
to the said posts. These reliefs were granted to them by the labour court
against which appeal preferred before the industrial court and the writ
petition before the High Court were also dismissed. In all these cases,
thereafter, special leave petitions were filed which were dismissed by this
Court by common order dated 21st January, 2015. This order reads as under:
“Delay condoned.
Dismissed.
We direct the State Government to implement the order(s) passed by the High
Court within eight months' time from today.
If for any reason, the petitioner-State does not implement the order(s)
passed by the High Court, the respondents are at liberty to approach this
Court by way of filing contempt petition(s).”
The State Government has passed the orders fixing the pay of these
petitioners at the minimum of the regular pay-scale attached to the
respective posts. To demonstrate, by way of example, in the case of Ram
Naresh Rawat, who was engaged as a daily wager, the pay is fixed at Rs.
15330/- in the pay-scale of Rs. 5200/- attached to the said post. Break up
of the aforesaid salary fixing is as under:
|Sl. |Particulars |Amount (Rs.) |
|No. | | |
|2(i) |Minimum in the Regular |5200/- |
| |pay scale granted vide | |
| |order dated 11.03.2016 | |
| |(per month) | |
|2(ii) |Grade pay (per month) |1800/- |
|2(iii)|D.A. (per month) |8330/- |
|2(iv) |Total salary and other |15330/- |
| |benefits in hand | |
| |(i+ii+iii) per month | |
At the time of passing the order, he was getting monthly wage
of Rs. 11,300/- as the daily wager. His salary, therefore, stands enhanced
of Rs. 4030/-. In addition, he is given arrears in the sum of Rs.
5,93,887/-. In similar manner, pay of all the petitioners has been fixed.
The petitioners are, however, not satisfied with the aforesaid fixation and
contended that the pay fixation has not been done as per the orders of this
Court. The precise submission is that once they are conferred the status
of permanent employee by the court and it is also categorically held that
they are entitled to regular pay attached to the said post, not only the
pay should be fixed in the regular pay-scale, the petitioners would also be
entitled to the increments and other emoluments attached to the said post.
In other words, they pleaded that fixation of pay at the minimum of the pay-
scale is uncalled for and does not amount to complying with the directions
of the Court in full measure. It is also submitted that in some other
cases where the High Court has given similar directions, which are followed
in their cases, the State Government has not only fixed pay in the regular
pay-scale but has also been granting increments etc. as well.
The case set up by the respondents, on the other hand, is that the
petitioners are daily wage employees. They have not been 'regularised' in
their respective posts for want of adequate number of regular vacancies.
They are granted 'permanency' in terms of standing orders which, at the
most, entitles them to get the pay which is given to employees appointed on
regular basis but such an entitlement is to the minimum of the said pay-
scale. It is also argued that even the direction of the High Court was to
grant pay in the regular pay-scale with effect from the date of
classification orders and there is no direction given by the High Court to
give them increments etc. which is admissible only when a person is
appointed on regular basis or whose services are regularised, which has not
happened in the case of the petitioners.
Learned counsel who appeared for these petitioners have drawn our attention
to the relevant provisions of the standing orders on the basis of which
they were classified as permanent. It is standing order No. 2 which deals
with classification of the employees and reads as under:
“2. Classification of Employees.— Employees shall be classified as (i)
permanent, (ii) permanent seasonal, (iii) probationers, (iv) Badlies, (v)
apprentices, and (vi) temporary:
(i) A 'permanent' employee is one who has completed six months'
satisfactory service in a clear vacancy in one or more posts whether as a
probationer or otherwise, or a person whose name has been entered in the
muster roll and who is given a ticket of permanent employee;
(ii) A 'permanent seasonal employee' is one who has completed service for
a period equal to 2/3rd of the duration or a season or three months
whichever is less in a clear vacancy and shall be deemed to be a permanent
employee for the purpose of these order;
(iii) A 'probationer' means an employee who is provisionally employed to
fill a clear vacancy, and who has not completed six months' satisfactory
service in the aggregate;
(iv) A 'badli', employee means an employee who is employed on the post of
a permanent seasonal employee, or a probationer or a permanent seasonal
employee who is temporarily absent.
(v) An 'apprentice' means a learner, provided that no employee shall be
classified as an apprentice if he ha shad training for an aggregate period
of one year, provided further that a longer period of apprenticeship shall
be required if prescribed by a law or an award, or by agreement with the
representative of employees;
(vi) 'temporary employee' means an employee who has been employed for work
which is essentially of a temporary character, or who is temporarily
employed as an additional employee in connection with the temporary
increase in the work of a permanent nature, provided that in case such
employee is required to work. Continuously for more than six months he
shall be deemed to be a permanent employee, within the meaning of clause
(i) above.”
Once the labour court classified them as permanent, which classification
had attained finality, it necessarily follows that they are entitled to all
benefits which are to be given to regularly appointed employees.
It is further submitted that the High Court specifically went into the
question as to whether, on attaining permanency, these petitioners were
entitled to the pay-scale attached to the post which is given to the
regularly recruited employee and answered the said question in the
affirmative. Our attention was drawn to one such order dated 8th May, 2008
passed by the High Court in Writ Petition No. 1306 of 2008 where this issue
is specifically dealt with in detail and decided in favour of the
petitioners, after taking note of various judgments. It was further
pointed out that in some other cases, increments are also given while
fixing pay in the regular pay-scale. Example of one such case given by the
petitioner is State of Madhya Pradesh & Ors. Vs. Bhasker Sharma[1] wherein
the Writ Appeal was also dismissed. It was submitted that after the
dismissal of the appeal, Bhasker Sharma was not only granted regular pay-
scale but is getting increments and other benefits attached to the said
post as well. It was also argued that many such employees have been given
similar benefits and the State Government has now taken a 'U' turn and is
not willing to extend such benefits to the petitioners herein. Copies of
many such orders passed by the High Court are filed by the petitioners as
additional documents in support of their submissions.
Mr. Mukul Rohatgi, learned Attorney General, who appeared on behalf of the
State Government and the Contemnors emphasised that the only direction of
the High Court, which has been upheld by this Court, is that these
petitioners are entitled to pay in a regular scale. It is argued that they
have been classified as “permanent” because of the aforesaid standing
orders which means that their services would not be terminated. However,
that does not mean that the petitioners are regularised against any posts.
It was also argued that each of these petitioners have been given
substantial amount as arrears of pay in terms of the orders passed by the
High Court and there is significant enhancement in the monthly emoluments
now drawn by these petitioners. The learned Attorney General further
submitted that there are 520 such employees who have gained entry into the
service through backdoor as they were not appointed on regular basis
against regular vacancy after following required selection procedure. Such
employees, like the petitioners, cannot seek regularisation and benefits
emanating from such regularisation in view of the law laid down by the
Constitution Bench of this Court in State of Karnataka Vs. Uma Devi[2].
It was also argued that instant proceedings are in the contempt cases where
scope of jurisdiction was limited. The State had complied with the
directions in a bona fide manner on its understanding about the orders of
the High Court against which SLPs have been dismissed and in case the
grievance of the petitioners is that they are entitled to something more
than what is granted by the State Government, they can challenge the order
passed by the Government fixing their pay, by taking recourse to
substantive proceedings but not in the form of contempt petition.
Mr. Rohatgi also brought to the notice of this Court a subsequent
event which has been brought on record by filing additional affidavit. It
was pointed out that on 7th October, 2016, the State Government has
promulgated a one-time scheme for regularisation of all daily wage
employees in the State. Copy of the said scheme is annexed, salient
features whereof are as under:
“(I) The Daily wage employees will now be classified as “Sthayee Karmi”.
(II) They are classified in three categories, i.e., Unskilled, Semi-
skilled, and Skilled. Their pay scale is also determined accordingly. Pay
Scale of a skilled employee is Rs. 5000-100-8000.
(III) They will be given the benefit of seniority and their actual pay on
September 1, 2016 in their pay scale will be determined based on the years
of service put in by them.
(IV) They will be entitled to Dearness Allows. (Presently at 125%)
(V) The pay fixation in the pay scale will be applicable from 1.9.2016.
Next increment in salary will be given in September 2017.
(VI) On attaining the age of superannuation, they will be entitled to
Gratuity based on 15 days salary per year during the period of service.
Maximum limit of this amount will be Rs. 1,25,000/- for unskilled, Rs.
1,50,000/- for semi-skilled, and Rs. 1,75,000/- for skilled workers.
(VII) Such daily wager employees who were working on 16.5.2007, and have
also been in service as on 1.9.2016 will be entitled to the pay scale
mentioned above and other benefits.
6. In view of the aforesaid scheme, the MP Daily Wages Employee
(Conditions of Service), Rules, 2013 now stands repealed.
7. The scheme also prescribes the steps to be taken for filling up the
vacant Regular posts. For this purpose the vacant Class IV posts available
in the regular setup under various departments at the district level would
be filled up on priority from the existing sthayee karmis. The workers
working with various Construction Departments (Nirman Vibhag) will be
treated as Industrial Workers for the purposes of Standing Order Act, 1961
and Rules, 1963 and the permanent classified employees of such Departments
are also entitled to be regularised accordingly.
8. In view of the aforesaid, it is submitted that the daily wage
employees are also entitled to the aforesaid benefits at the time of
superannuation as mentioned in the Scheme.”
He, thus, submitted that if the petitioners opt for the said
scheme, they would get the benefits thereof after their retirement.
Before we consider the respective submissions, we want to make two
observations which are crucial to the issue involved. These are:
(i) The matter is being examined in the contempt jurisdiction of
this Court. From the chronology of events given, it would be clear that
initially these petitioners had claimed their classification as 'permanent'
to the respective posts. They succeeded in this attempt and the orders
passed therein in their favour was that they would be classified as
'permanent' and that they would also be entitled to pay-scale of permanent
posts from the dates specified in the award given by the labour court.
In the second round of litigation, out of which present
contempt petitions arise, direction of the High Court is to grant them pay-
scales attached to the posts to which they are working.
This order has been upheld by this Court as well inasmuch
as Special Leave Petitions filed by the State Government have been
dismissed by common orders dated 21st January, 2015. However, there is no
specific direction for grant of increments.
(ii) In order to implement the directions of High Court, against which
special Leave Petitions have been dismissed, the State Government has
passed order dated 11th March, 2016 vide which the pay-scale of the
petitioners has been fixed in the pay-scale attached to these posts. This
has also been given from the dates to which these petitioners are held
entitled to and on that basis arrears of pay have also been paid. However,
the pay is fixed at the minimum of the said pay-scales and there is also
stipulation in the said orders dated 11th March, 2016 that these employees
would not be entitled to increment of salary.
It is clear from the above that the petitioners have been given pay in the
regular pay-scale. Petitioners, however, have joined issue by contending
that orders dated 11th March, 2016 do not carry out the complete compliance
of the directions given by the High court that on fixation of pay in the
regular pay-scale the petitioners are also entitled to increments of
salary, as is given to the regular employees, on annual basis.
Therefore, the question that arise for consideration is as to
whether the petitioners are also entitled to the increments.
It is not in dispute that the petitioners were initially engaged on daily
wage basis. Their engagement was also done without following any selection
procedure. It also does not emerge from record that the initial engagement
of these petitioners was against regular vacancies. Normally, in such a
situation even if these persons, because of their long service and also on
the assumption that they are discharging the same duties as discharged by
regular employees, such employees can claim the salary which is being paid
to regular employees holding similar posts on the principles of 'equal pay
for equal work'. This aspect has exhaustively and authoritatively being
dealt with by this Court in a recent judgment dated 26th October, 2016 in
Civil Appeal No. 213 of 2013, titled State of Punjab and Ors. vs. Jagjit
Singh and Ors.[3] and other connected appeals, though, there is one
distinguished factor, viz. the petitioners herein have been conferred the
status of 'permanent' employees. However, an important question which
arises is as to whether such 'permanent' employees are same as employees
appointed on 'regular' basis or their services stand regularized. This
aspect shall be touched upon and dealt with a little later. At this stage,
reference is made to the aforesaid judgment in the case of Jagjit Singh3
for the purpose that even if principle of 'equal pay for equal work' is
applicable and the pay in the regular pay-scale is admissible to such
employees, these employees would be entitled to minimum of the regular pay-
scale and not the increments. This case is taken note of and discussed in
Jagjit Singh3 in the following manner:
“36. Secretary, State of Karnataka v. Umadevi [(2006) 4 SCC 1], decided by
a five-Judge Constitution Bench: Needless to mention, that the main
proposition canvassed in the instant judgment, pertained to regularization
of government servants, based on the employees having rendered long years
of service, as temporary, contractual, casual, daily-wage or on ad-hoc
basis. It is, however relevant to mention, that the Constitution Bench did
examine the question of wages, which such employees were entitled to draw.
In paragraph 8 of the judgment, a reference was made to civil appeal nos.
3595-612 of 1999, wherein, the respondent-employees were temporarily
engaged on daily-wages in the Commercial Taxes Department. As they had
rendered service for more than 10 years, they claimed permanent employment
in the department. They also claimed benefits as were extended to regular
employees of their cadre, including wages (equal to their salary and
allowances) with effect from the dates from which they were appointed. Even
though the administrative tribunal had rejected their claim, by returning a
finding, that they had not made out a case for payment of wages, equal to
those engaged on regular basis, the High Court held that they were entitled
to wages, equal to the salary of regular employees of their cadre, with
effect from the date from which they were appointed. The direction issued
by the High Court resulted in payment of higher wages retrospectively, for
a period of 10 and more years. It would also be relevant to mention, that
in passing the above direction, the High Court had relied on the decision
rendered by a three-Judge bench of this Court in Dharwad District PWD
Literate Daily- Wage Employees Association v. State of Karnataka[(1990) 2
SCC 396]. The Constitution Bench, having noticed the contentions of the
rival parties, on the subject of wages payable to daily-wagers, recorded
its conclusions as under:-
“55. In cases relating to service in the commercial taxes department, the
High Court has directed that those engaged on daily wages, be paid wages
equal to the salary and allowances that are being paid to the regular
employees of their cadre in government service, with effect from the dates
from which they were respectively appointed. The objection taken was to the
direction for payment from the dates of engagement. We find that the High
Court had clearly gone wrong in directing that these employees be paid
salary equal to the salary and allowances that are being paid to the
regular employees of their cadre in government service, with effect from
the dates from which they were respectively engaged or appointed. It was
not open to the High Court to impose such an obligation on the State when
the very question before the High Court in the case was whether these
employees were entitled to have equal pay for equal work so called and were
entitled to any other benefit. They had also been engaged in the teeth of
directions not to do so. We are, therefore, of the view that, at best, the
Division Bench of the High Court should have directed that wages equal to
the salary that is being paid to regular employees be paid to these daily-
wage employees with effect from the date of its judgment. Hence, that part
of the direction of the Division Bench is modified and it is directed that
these daily-wage earners be paid wages equal to the salary at the lowest
grade of employees of their cadre in the Commercial Taxes Department in
government service, from the date of the judgment of the Division Bench of
the High Court. Since, they are only daily-wage earners, there would be no
question of other allowances being paid to them. In view of our conclusion,
that Courts are not expected to issue directions for making such persons
permanent in service, we set aside that part of the direction of the High
Court directing the Government to consider their cases for regularization.
We also notice that the High Court has not adverted to the aspect as to
whether it was regularization or it was giving permanency that was being
directed by the High Court. In such a situation, the direction in that
regard will stand deleted and the appeals filed by the State would stand
allowed to that extent. If sanctioned posts are vacant (they are said to be
vacant) the State will take immediate steps for filling those posts by a
regular process of selection. But when regular recruitment is undertaken,
the respondents in C.A. Nos. 3595-3612 and those in the Commercial Taxes
Department similarly situated, will be allowed to compete, waiving the age
restriction imposed for the recruitment and giving some weightage for their
having been engaged for work in the Department for a significant period of
time. That would be the extent of the exercise of power by this Court under
Article 142 of the Constitution to do justice to them.”
We have extracted the aforesaid paragraph, so as not to make any inference
on our own, but to project the determination rendered by the Constitution
Bench, as was expressed by the Bench. We have no hesitation in concluding,
that the Constitution Bench consciously distinguished the issue of pay
parity, from the issue of absorption/regularization in service. It was
held, that on the issue of pay parity, the High Court ought to have
directed, that the daily-wage workers be paid wages equal to the salary at
the lowest grade of their cadre. The Constitution Bench expressed the view,
that the concept of equality would not be applicable to the issue of
absorption/regularization in service. And conversely, on the subject of
pay parity, it was unambiguously held, that daily-wage earners should be
paid wages equal to the salary at the lowest grade (without any
allowances). ”
Another significant reason for referring to the judgment of Jagjit Singh3
is that the Court culled out the principles of 'equal pay for equal work'
from the earlier judgments on the subject and collated them at one place.
Further, the Court also drew an important distinction between the grant of
benefit of 'equal pay for equal work' to temporary employees on the one
hand and the status of regular employees on the other hand. Insofar as
parameters of principles of 'equal pay for equal work' deduced by the Court
are concerned (para 42), our purpose of deduction stated in sub-para vi
thereof is important, which is reproduced below:
“(vi) For placement in a regular pay-scale, the claimant has to be a
regular appointee. The claimant should have been selected, on the basis of
a regular process of recruitment. An employee appointed on a temporary
basis, cannot claim to be placed in the regular pay-scale (see – Orissa
University of Agriculture & Technology Vs. Manoj K. Mohanty[4]). ”
Insofar as distinction between pay parity and regularisation of service is
concerned, referring to the Constitution Bench judgment in Uma Devi2, the
Court made the following observations:
“We are of the considered view, that in paragraph 44 extracted above, the
Constitution Bench clearly distinguished the issues of pay parity, and
regularization in service. It was held, that on the issue of pay parity,
the concept of ‘equality’ would be applicable (as had indeed been applied
by the Court, in various decisions), but the principle of ‘equality’ could
not be invoked for absorbing temporary employees in Government service, or
for making temporary employees regular/permanent. All the observations made
in the above extracted paragraphs, relate to the subject of
regularization/permanence, and not, to the principle of ‘equal pay for
equal work’. As we have already noticed above, the Constitution Bench
unambiguously held, that on the issue of pay parity, the High Court ought
to have directed, that the daily-wage workers be paid wages equal to the
salary, at the lowest grade of their cadre. This deficiency was made good,
by making such a direction. ”
Thus, it follows that even if principle of 'equal pay for equal
work' is applicable, temporary employee shall be entitled to minimum of the
pay-scale which is attached to the post, but without any increments.
Insofar as petitioners before us are concerned they have been classified as
'permanent'. For this reason, we advert to the core issue, which would
determine the fate of these cases, viz., whether these employees can be
treated as 'regular' employees in view of the aforesaid classification? In
other words, with their classification as 'permanent', do they stand
regularized in service?
For this purpose, we would first like to refer to the provisions of the
Madhya Pradesh Industrial Employment (Standing Orders) Act, 1961 and the
Rules made thereunder known as the Madhya Pradesh Industrial Employment
(Standing Orders) Rules, 1963. Section 3(c) of the Act defines “Standing
Orders” and as per Section 6, the State Government may, by notification,
apply Standard Standing Orders to such class of undertakings and from such
date as may be specified therein. Section 21 empowers the State
Government to make rules to carry out the purposes of the said Act which
are required to be notified. It empowers the State Government to frame
Standard Standing Orders as well. It is in exercise of powers under
Section 21(1) of the Act that the State Government has framed Madhya
Pradesh Industrial Employment (Standing Orders) Rules, 1963 (hereinafter
referred to as the 'Rules'). Annexure to these Rules contains standard
Standing Orders for all undertakings in the State. Standing Order No. 2 of
this Order enumerates classification of employees which has already been
reproduced above. As per this classification, an employee would be known
as 'permanent employee' who has completed six months' satisfactory service
in a clear vacancy in one or more posts whether on probation or otherwise
or a person whose name has been entered in the muster roll and who is given
a ticket of 'permanent employee'. It follows from the above that merely by
putting in six months' satisfactory service, an employee can be treated as
'permanent employee'. Rights which would flow to different categories of
employees including 'permanent employee' are not stipulated in these Rules
or even in the parent Act. It can be gathered from Rule 11 of the said
Rules, which relates to termination of employment, that in case of a
'permanent employee' one month's notice or wages for one month in lieu of
notice is required when the employment of a 'permanent employee' is to be
terminated. On the other hand, no such notice or wages in lieu thereof is
needed to be given to any other category of employees. Additional
obligation casts on the employer is to record reasons for termination of
service in writing and communicate the same to the employee.
With this, we advert to the question posed above. In the first blush, this
question appears to be somewhat puzzling, as to how such a question can
arise because normally an employee who is given the designation of
'permanent employee' should be treated as 'regular employee' as well.
However, this puzzle vanishes when we examine the standing orders, acts and
rules in question under which designation of 'permanent employee' is
acquired. Fortunately for us, we are not trading on a virgin territory.
This Court has already examine the issue in the context of these very
standing orders of Madhya Pradesh. In the case of Mahendra L. Jain & Ors.
v. Indore Development Authority & Ors.[5], this Court analyzed the Standard
Standing Order in question and held that permanent classification does not
amount to regularization, inasmuch as it was noted that the matter relating
to the recruitment is governed by a separate statute, as can be seen from
the following discussion therein:
“28. The 1961 Act provides for classification of employees in five
categories. The 1973 Act, as noticed hereinbefore, clearly mandates that
all posts should be sanctioned by the State Government and all appointments
to the said cadre must be made by the State Government alone. Even the
appointments to the local cadre must be made by the Authority. The said
provisions were not complied with. It is accepted that no appointment
letter was issued in favour of the appellants. Had the appointments of the
appellants been made in terms of the provisions of the Adhiniyam and the
Rules framed thereunder, the respondent Authority was statutorily enjoined
to make an offer of appointment in writing which was to be accepted by the
appellants herein. Who made the appointments of the appellants to the
project or other works carried on by the Authority is not known. Whether
the person making an appointment had the requisite jurisdiction or not is
also not clear. We have noticed hereinbefore that in the case of Om Prakash
Mondloi, the CEO made an endorsement to the effect that he may be tried in
daily wages and should be entrusted with the work of progress collection of
ODA work. The said order is not an “offer of appointment” by any sense of
the term.
xxx xxx xxx
31. 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 statutes.
The only provision as regards recruitment of the employees is contained in
Order 4 which merely provides that the manager shall within a period of six
months, lay down the procedure for recruitment of employees and notify it
on the notice board on which Standing Orders are exhibited and shall send
copy thereof to the Labour Commissioner. The matter relating to recruitment
is governed by the 1973 Act and the 1987 Rules. In the absence of any
specific directions contained in the Schedule appended to the Standing
Orders, the statute and the statutory rules applicable to the employees of
the respondent shall prevail.”
The issue came up again in the case of M.P. State Agro Industries
Development Corporation Ltd. & Anr. v. S.C. Pandey[6] wherein this Court
held that only because a temporary employee has completed 240 days of work,
he would not be entitled to be regularized in service. The Court also
reiterated that the Standing Orders categorize the nature of employment and
do not classify individual employees in different post according to the
hierarchy created in the Department and thus proviso to Rule 2 does not
apply to promotions or regularization in higher grade. We would like to
reproduce following paras from the said judgment:
“17. The question raised in this appeal is now covered by a decision of
this Court in M.P. Housing Board v. Manoj Shrivastava [(2006) 2 SCC 702]
wherein this Court clearly opined that: (1) when the conditions of service
are governed by two statutes; one relating to selection and appointment and
the other relating to the terms and conditions of service, an endeavour
should be made to give effect to both of the statutes; (2) a daily-wager
does not hold a 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; (3) only because an employee had been
working for more than 240 days that by itself would not confer any legal
right upon him to be regularised in service; (4) if an appointment has been
made contrary to the provisions of the statute the same would be void and
the effect thereof would be that no legal right was derived by the employee
by reason thereof.
18. The said decision applies on all fours to the facts of this case. In
Mahendra L. Jain [(2005) 1 SCC 639 : 2005 SCC (L&S) 154] this Court has
categorically held that the Standing Orders governing the terms and
conditions of service must be read subject to the constitutional and
statutory limitations for the purpose of appointment both as a permanent
employee or as a temporary employee. An appointment to the post of a
temporary employee can be made where the work is essentially of temporary
nature. In a case where there existed a vacancy, the same was required to
be filled up by resorting to the procedures known to law i.e. upon
fulfilling the constitutional requirements as also the provisions contained
in the 1976 Regulations. No finding of fact has been arrived at that before
the respondent was appointed, the constitutional and statutory requirements
were complied with.
xx xx xx
22. Such appointments, in our opinion, having regard to the decisions in
Mahendra L. Jain [(2005) 1 SCC 639 : 2005 SCC (L&S) 154] and Manoj
Shrivastava [(2006) 2 SCC 702] must be made in accordance with extant rules
and regulations. It is also a well-settled legal position that only because
a temporary employee has completed 240 days of work, he would not be
entitled to be regularised in service. Otherwise also the legal position in
this behalf is clear as would appear from the decision of this Court
inDhampur Sugar Mills Ltd. v. Bhola Singh [(2005) 2 SCC 470 : 2005 SCC
(L&S) 292] apart from Mahendra L. Jain [(2005) 1 SCC 639 : 2005 SCC (L&S)
154].”
A direct judgment on the subject is State of M.P. & Ors. v. Lalit Kumar
Verma[7] wherein it was held that a workman would be entitled to
classification as permanent or temporary employee if the conditions
precedent are satisfied. It was held that the respondent was not appointed
against the clear vacancy, he was not appointed in a permanent post or
placed on probation. This Court, thus, held that working on daily wages
alone would not entitle him to the status of permanent employee. Para 7 of
this judgment needs to be looked into.
“7. A workman, therefore, would be entitled to classification of permanent
or temporary employee, if the conditions precedent therefor are satisfied.
The respondent was not appointed against a clear vacancy. He was not
appointed in a permanent post or placed on probation. He had also not been
given a ticket of permanent employee. Working on daily wages alone would
not entitle him to the status of a permanent employee.”
It is, thus, somewhat puzzling as to whether the employee, on getting the
designation of 'permanent employee' can be treated as 'regular' employee.
This answer does not flow from the reading of the Standing Orders Act and
Rules. In common parlance, normally, a person who is known as 'permanent
employee' would be treated as a regular employee but it does not appear to
be exactly that kind of situation in the instant case when we find that
merely after completing six months' service an employee gets right to be
treated as 'permanent employee'. Moreover, this Court has, as would be
noticed now, drawn a distinction between 'permanent employee' and 'regular
employee'.
We may mention, at this stage that this aspect has come up for
consideration, in another context, in State of Madhya Pradesh and Others
vs. Dilip Singh Patel and Others[8]. That was a case where similarly
situated employees, who were classified as 'permanent employees' under the
Standing Orders Act, were given minimum of the pay-scale attached to their
posts. However, after the implementation of Sixth Pay Commission, benefits
thereof were not extended to these employees. High Court held that they
would be entitled to have their pay fixed as per the revised scales in
accordance with the recommendations of Sixth Pay Commission which were
accepted qua regular employees. This Court, though, upheld the orders of
the High Court giving them the benefit of revision of pay-scale pertained
to Sixth Pay Commission, but at the same time made it clear that they would
be entitled to minimum salary and allowances as per the said revised scales
and would not be entitled to any increments. It was further held that such
increments would be admissible only after regularisation of their services
which regularisation was to take place as per the seniority list with due
procedure. Following passage from the said judgment, which captures the
aforesaid directions, is quoted hereunder:
“We have heard learned counsel for the parties and perused the records. It
appears that the respondents earlier moved before the Administrative
Tribunal, Gwalior by filing original applications such as O.A. No. 648 of
1995, O.A. No. 293 of 1991 etc. In compliance of the orders passed in such
original applications, the Chief Engineer, Yamuna Kachhar, Water Resources
Department, Gwalior (M.P.)( by orders issued in between April,. 2004 and
June, 2004 provided the mi8nimum wages and allowances to the respondents
without increment as per the Schedule of the pay scale from the date of the
order of the Tribunal. It was further ordered that the regularization of
the daily wages employees shall be made as per the seniority list with due
procedure and the benefit of increment and other benefits can only be
granted after the regularisation as per the Rules. It was ordered that the
order of the Court for benefit of minimum wages and allowances shall be
…..........
From the aforesaid facts, it is clear that the respondents are
entitled for minimum wages and allowance as per the fixed Schedule of the
pay scale but without any increment. In such case, if the pay scale is
revised from time to time including the pay-scale as revised pursuant to
Sixth Pay Commission, the respondents will be entitled to minimum wages and
allowance as per the said revised scale without increment. Only after
regularisation of their service, as per seniority and rules, they can claim
the benefit of increment and other benefits.”
From the aforesaid, it follows that though a 'permanent employee' has right
to receive pay in the graded pay-scale, at the same time, he would be
getting only minimum of the said pay-scale with no increments. It is only
the regularisation in service which would entail grant of increments etc.
in the pay-scale.
In view of the aforesaid, we do not find any substance in the contentions
raised by the petitioners in these contempt petitions. We are conscious of
the fact that in some cases, on earlier occasions, the State Government
while fixing the pay scale, granted increments as well. However, if some
persons are given the benefit wrongly, that cannot form the basis of
claiming the same relief. It is trite that right to equality under Article
14 is not in negative terms (See Indian Council of Agricultural Research &
Anr. v. T.K. Suryanarayan & Ors.[9]).
These contempt petitions are, accordingly, dismissed.
.............................................J.
(A.K. SIKRI)
.............................................J.
(N.V. RAMANA)
NEW DELHI;
DECEMBER 15, 2016.
-----------------------
[1] Writ Appeal No. 322/2009; Order dated 30.11.2009; By High Court of
M.P., Gwalior Bench
[2] (2006) 4 SCC 1
[3] Civil Appeal No. 213 of 2013; 26th October, 2016
[4] (2003) 5 SCC 188
[5] (2005) 1 SCC 639
[6] (2006) 2 SCC 716
[7] (2007) 1 SCC 575
[8] Civil Appeal Nos. 8431-8432 of 2014; decided on August 27, 2014.
[9] (1997) 6 SCC 766
