IMPORTANT POINT
Co-terminus appointment - tenure.

JUDGEMENT

H.L. Gokhale J.

Leave Granted in both these appeals.

2. Both these appeals raise the question as to whether the employees who are appointed on a co-terminus basis have any right to continue in service after the cessation of the engagement of the person with whose engagement their services were made co-terminus.

Facts leading to these appeals are this wise:-

3. The Pondicherry Khadi and Village Industries Board (Board for short) is a statutory body corporate constituted under Section 3 of the Pondicherry Khadi and Village Industries Board Act, 1980 (Board Act for short). The board is running various Khadi spinning/weaving/silk centers which provide employment opportunities to a large number of persons, particularly women. It runs several Khadi Bhandars for the sale of Khadi and Village Industries goods produced by the board. The board has 219 sanctioned posts at various levels as approved by the Government of Puducherry. It has framed Recruitment Rules/Standing Orders with respect to each of these posts.

4. Government of India had issued Office Memorandum dated 18.5.1998, wherein after referring to the principles laid down by this Court in Excise Superintendent Malkapatnam, Krishna District, A.P. Vs. K.B.N. Visweshwara Rao and Ors. reported in 1996 (6) SCC 216 (which recognises the recruitment through the employment exchanges as the principle mode of recruitment), it was directed that all vacancies arising under the Central Government Offices/establishments (including quasi-government institutions and statutory organizations) irrespective of the nature and duration (other than those filled through UPSC), are not only to be notified, but also to be filled through the Employment Exchange alone.

Other permissible sources of recruitment were to be tapped only if the Employment Exchange concerned issued a Non-availability Certificate. There can be no departure from this recruitment procedure unless a different arrangement in this regard has been previously agreed to in consultation with the Department and the Ministry of Labour (Directorate General, employment & Training). Similar instructions are also in force requiring vacancies against posts carrying a basic salary of less than Rs. 500/- per month in Central Public Sector undertaking to be filled only through Employment Exchange.

5. It so transpired that one Shri P. Angalan, assumed the office of the Chairman of the Board on 12.7.2002, and he desired engagement of certain persons as his personal staff. There was no provision for any sanctioned post of personal staff in the board, yet without obtaining the names sponsored by the Employment Exchange, the said Chairman engaged five persons as his personal staff viz. the four respondents herein and one T. Kumar (since deceased).

6. In view of the persuasion of the said Chairman, the Government of Puducherry issued general orders dated 13.2.2003 appointing the respondents on co-terminus basis. They were appointed on fixed scale of pay. The appointment orders of these respondents clearly stated that their service shall automatically stand terminated, as soon as the tenure of the Chairman is over. The government order approving the appointment of these five persons read as follows:-

“GOVERNMENT OF PONDICHERRY

DEPARTMENT OF INDUSTRIAL DEVELOPMENT

(INDUSTRIES AND COMMERCE)

No. J.12014/5/2002/Ind. & Com.B Pondicherry, the 26 Mar 2003

To

The Chief Executive Officer,

Pondicherry Khadi and Village Industries Board,

Plot No. 1 & 2, Kamaraj Salai,

New Saram, Pondicherry

Sir,

Sub: DID (Ind & Com.) – Providing personal staff to the Chairman of the Boards/Corporations-Approval-Conveyed

Ref:1 I.D. No.A.52011/1/2002/DP&AR/SSI (2)

Dated 13.02.2003 of the Department of Personnel and Administrative Reforms (Personnel Wing), Pondicherry

2. Letter No. 1/516/2002/Estt-I dated 13.03.2003 from the Chief Executive Officer, Pondicherry Khadi and Village Industries Board, Pondicherry

I am directed to invite a kind reference to the I.D. Note cited under reference one above.

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