Judgment

BHAGWATI, J.: - The question that arises for determination in this appeal is as to which authority was entitled to terminate the service of the first respondent - the Central Government or the Government of Punjab.

2. The first respondent was, prior to his appointment as an Assistant Settlement Commissioner, holding the post of Deputy Registrar, Land Record in a temporary capacity under the State of Punjab. The first respondent had no lien on any permanent post and was a temporary servant of the - Punjab Government. On the coming into force of the Displaced Persons (Compensation and Rehabilitation) Act, 1954 (hereinafter referred to as the Act) it became necessary to appoint officers and staff in the State of Punjab for the purpose of carrying out various functions and duties under the Act. One of such functions and duties was grant of proprietary rights to quasi permanent allottees of agricultural land and houses in the rural areas in the State of Punjab. The President of India, therefore, sanctioned the creation of certain posts which included two posts of Assistant Director to be designated as Assistant Settlement Commissioner under the Act for a period of six months from the date of promulgation of the Rules framed under the Act "for the work connected with the conversion of quasi-permanent allottees into permanent ones" and the Central Government, by its letter dated 18th April, 1955 conveyed this sanction to the State Government. This letter contained a direction that the over-all expenditure in connection with these posts sanctioned by the President of India should not exceed Rs. 6.50 lacs and it would be shared between the Central Government and the State Government in the ratio of 50-50. It was also suggested in this letter that the names of officers appointed as Assistant Directors and Naib Tehsildars should be intimated in due course for issue of necessary notifications under the provisions of the Act. The State Government, by its letter dated 3rd July, 1955, pointed out to the Central Government that having regard to the large magnitude of the work involved, it would be necessary to have two whole-time officers exclusively devoted to this work and suggested that two posts should, therefore, be permitted to be created, one of a Deputy Secretary "who would have administrative control over all the managing officers and settlement officers and the staff appointed in connection with the conferment of permanent rights" and the other of an Assistant Settlement Commissioner. It appears that the Central Government in the meantime reconsidered its earlier decision that the expenditure on the posts in connection with the grant of proprietary rights to quasi-permanent allottees should be borne 50-50 between the Central Government and the State Government and by its letter dated 20th July, 1955 intimated to the State Government that the Central Government would bear the entire expenditure on the staff appointed to these posts on condition that the staff in question will be engaged for a period of six months only." The Central Government thereafter, by its letter dated 23rd July, 1955 conveyed the sanction of the President of India to the creation of one Post of Additional/ Settlement Commissioner and one post of Assistant Settlement Commissioner for a period of six months for the work connected with the conversion of quasi-permanent allotments into permanent ones on the scale of pay noted against each plus usual allowance admissible to the State Government employees of their status." We are concerned in this appeal with the post of Assistant Settlement Commissioner Sanctioned by the President of India as mentioned in this letter dated 23rd July, 1955.

3. Though the order of appointment of the first respondent to the post of Assistant Settlement Commissioner was not yet passed, the first respondent relinquished charge of his post of Deputy Registrar, land Record and assumed charge of the post of Assistant Settlement Commis