Judgement

CHINNAPPA REDDY, J.:- The question raised in these appeals is whether an establishment in the public sector or an establishment in the private sector as defined in the Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959 may make appointments to posts to which the Act applies, of persons not sponsored by the Employment Exchanges ? A further question is whether the Act covers Government establishments also ? A Division Bench of the High Court of Andhra Pradesh has held that the Act has no application to Government establishments, that the Act casts no obligation either on the public sector establishment or on the private sector establishment to make the appointments from among candidates sponsored by the employment exchanges only and that any insistence that candidates sponsored by the employment exchanges alone should be appointed would be contrary to the right guaranteed by Arts. 14 and 16 of the Constitution. The learned Additional Solicitor General appearing for the Union of India argued that the object and the scheme of the Employment Exchanges (Compulsory Notification of Vacancies) Act and the instructions issued by the Government of India from time to time left no option to the employers but to confine their field of choice to candidates sponsored by the employment exchanges. It was argued that such insistence that appointments should be made from candidates sponsored by the employment exchanges only did not offend Arts. 14 and 16 of the Constitution. He also argued that the Act was applicable to Government Establishments also.

2. We may refer to the provisions of the Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959 without further ado. The title of the Act itself suggests that the compulsion is in regard to notifying of vacancies only and nothing more. The preamble to the Act, like the title of the Act, also does not suggest any compulsion in the making of appointments, but only in the notifying of vacancies. The preamble says "An Act to provide for the compulsory notification of vacancies to employment exchanges." Section 2(e), (f) and (g) defines "establishment", "establishment in public sector" and "establishment in private sector" as follows: -

"(e) "establishment" means -

(a) any office, or

(b) any place where any industry, trade, business or occupation is carried on;

(f) "establishment in public sector" means an establishment owned, controlled or managed by

(1) the Government or a department of the Government;

(2) A Government company as defined in S. 617 of the Companies Act, 1956;

(3) A corporation (including a co-operative society) established by or under a Central, Provincial or State Act, which is owned, controlled or managed by the Government;

(4) A local authority;

(g) "Establishment in private sector" means an establishment which is not an establishment in, public sector and where ordinarily twenty-five or more persons are employed to work for remuneration."

The High Court thought that the definition of "establishment in public sector" as meaning an establishment owned, controlled or managed by the Government or a Department of the Government indicated that an establishment in public sector was something different from the Government or a Department of Government and did not include the Government or Department of the Government. It had to be something which could be owned, controlled or managed by the Government or a department of the Government. The High Court also thought that the expression public sector was used in contradiction to private sector and that it could not include offices of the Government. The expression would only take in an agency or instrumentality of the State, but not the State itself. We are unable to agree with the conclusion of the High Court on this part of the case. If the definition of establishment which includes an office is read alongside the definition of establishment in public sector, it will be clear that Government offices are also i