The central legal point established in the judgment is the interpretation of the term 'public corporation' under the Uttar Pradesh Absorption of Retrenched Employees of Government/Corporations in Government Service Rules, 1991 and its application to institutions registered under the Societies Registration Act, 1860.

Dr. ARIJIT PASAYAT, J.

1.These appeals are inter-linked and are directed against common judgment of the Allahabad High Court. By the impugned judgment the order passed by the learned Single Judge was set aside.

2.Background facts in a nutshell are as follows:

Retrenched employees of Institute of Engineering and Rural Technology (for short IERT), 105 in number, filed a writ petition against the State of U.P. and its functionaries as well as the IERT praying for quashing the order dated 24.3.1999 by which it was decided that the Training-cum-Production Centre of IERT was to be closed down w.e.f. 31.3.1999 and the workmen employed were to be retrenched after paying compensation.

While allowing the writ petition the learned Single Judge gave directions which essentially read as follow:-

" The respondents are directed to prepare a list of the employees who were appointed prior to 1.10.1986 in the production-cum-training Centre of IERT, and were working continuously till the date of their retrenchment i.e. 31.3.1999 by excluding those who have retired, or have not given their option for absorption, to be absorbed in the vacancies in other polytechnics of the State of Government, which are recognized and funded or in any other technical institution, or any post which it may deem to be fit, in accordance with their eligibility and after relaxing age and other terms and conditions of recruitment. As and when petitioners are offered absorption on any equivalent post, they will vacate the quarters occupies by some of them in the premises of IERT. Since petitioners have accepted retrenchment compensation, no direction with regard to payment of salary is required to be given. The State Government is directed to draw the list, prepare the scheme and to offer appointment by absorption, preferably within a period of four months. There is no order as cost."

3. The present respondents questioned correctness of the order by filing special appeal before the High Court. By the impugned judgment the High Court allowed the special appeal. It held that IERT is not an instrumentality of the State and/or could not be termed to be State Government or a public Corporation. It was held that the finding of learned Single Judge that IERT is wholly owned, controlled and managed by the State Government is not correct.

4.Learned counsel for the appellants submitted that the basic questions are as follows:-

(a)Whether IERT was an instrumentality of the State.

(b)Whether the Uttar Pradesh Absorptions of Retrenched Employees of Government/Corporations in Government Service Rules, 1991 (in short the Absorption Rules) is applicable to the writ petitioners-appellants.

(c)Whether after receiving compensation, the concerned employees could question the closure.

5.It was submitted that IERT is registered under the Societies Registration Act, 1860 (in short the Societies Act) and in terms of the Absorption Rules the concerned employees were entitled to be given protection of the Absorption Rules. It is submitted that the expression "established" means that the institution has come into existence and, therefore, even though IERT has been registered under the Societies Act, that does not mean it is not established or constituted under any Uttar Pradesh Act.

6.In response, learned counsel for the respondent submitted that the concept of "established" or "constituted" is different from a body registered under the Societies Act.

7.The contentions raised need consideration. It has been accepted that there was no material placed before the High Court to establish that IERT is an instrumentality of the State. In Pradeep Kumar Biswas v. Indian Institute of Chemical Biology and Ors. (2002 (5) SCC 111), it has been clearly stated that even if a society or institute is registered under the Societies Act and some functionaries of the State Government and other members of the institute, such an institute may not be termed as an instrumentality of the St