IMPORTANT POINT
In a company where appointment on compassionate grounds is governed by rules and when it has been laid down that such appointment would be made depending upon the availability of vacancies, an appointment on compassionate grounds can be made only if a vacancy is available.

JUDGMENT

S.C. Agrawal, J.-Special Leave granted.

2. Hindustan Aeronautics Ltd., appellant herein, is a public sector undertaking having a number of units in the country and one such unit is located at Hyderabad. The appellant has made rules providing for employment on compassionate grounds. Rule 78.1 prescribes that one of the dependents of the deceased employee could be considered for appointment in the company, in preference to other applicants without being sponsored by the employment exchange. In Rule 78.3 it is, however, laid down that the General Managers are empowered to effect such appointment depending upon availability of vacancies in the respective staffing cadre/authorization, A.S. Thirumalai, the husband of the respondent, was employed as Senior Inspector (Quality Control) in the Hyderabad Unit of the appellant. He died on August 10, 1987. After his death the respondent submitted an application for appointment on compassionate grounds. Since a number of other applications had been received earlier for such appointment on compassionate grounds the name of the respondent was put on the wait list of candidates who had applied for employment on compassionate grounds. Her name was at S1. No. 22 in the said wait list. On account of a ban having been imposed on further appointments in the various units of the appellant no appointment could be made on compassionate grounds out of the said wait list. The respondent filed a writ petition (W.P. No. 12896 of 1991) in the Andhra Pradesh High Court praying for a writ of mandamus directing the appellant to provide suitable permanent employment to the respondent by creating a supernumerary post. The writ petition was opposed by the appellant on the ground that no vacancy was available since there was a ban on fresh recruitment and, therefore, appointment could not be given to the respondent. The learned Single Judge of the High Court by judgment dated July 21, 1995 issued a writ of mandamus directing the appellant to consider the candidature of the respondent on compassionate grounds to any suitable post in Class III or Class IV only and, if found suitable and eligible, to appoint her to such post within a period of two months. The learned Single Judge rejected the submission urged on behalf of the appellant that since there was a ban on further recruitment the appointment could not be given on compassionate grounds to the respondent. Reliance was placed on the observations contained in the decision of this Court in Smt. Sushma Gosain & Ors. v. Union of India & Ors.1. The appeal filed by the appellant against the judgment of the learned Single Judge was dismissed by the Division Bench of the High Court by judgment dated April 26, 1996. It was held that appointment on compassionate grounds is given notwithstanding whether there is any vacancy in the regular service or cadre or post, creating super- numerary post and continuing such supernumerary appointment until a regular vacancy is made available and the dependant of the bread winner is brought to the main stream of the service. Feeling aggrieved by the said judgment of the Division Bench of the High Court the appellant has filed this appeal.

3. Shri A.N. Jayaram the learned senior counsel appearing for the appellant, has submitted that the appellant is a high-tech Government company essentially attempting to meet defence requirements of aircrafts and that during the last 10 years, owing to change of policies, there is a serious decline in the work-order position and as a result the appellant is compelled to progressively decrease its manpower by placing a ban on fresh recruitment and offering incentives for voluntary retirement. It has been pointed out that during the period April 1, 1987 to April 1, 1986 there has been a progressive reduction of the workforce including Class III and IV employees in all the units including the Hyderabad unit. The submission is that the High Court was in error in holding that even when there is n