IMPORTANT POINT
When services of employees of a government department is transferred to a corporation lock, stock and barrel and there is no challenge to the same, the employees cease to be government servants.

JUDGMENT :

Shiva Kirti Singh, J.

1. This appeal by special leave assails the judgment and order dated 24.04.2006 passed by a Division Bench of High Court of Punjab and Haryana dismissing LPA No. 700 of 2002 preferred by the appellants and affirming the judgment of learned Single Judge dated 11.01.2002 whereby Writ Petition bearing CWP No. 11908 of 1992 preferred by some of the respondents was allowed. Some had preferred to file suits and Civil Appeals which were dismissed. Their Regular Second Appeal No. 430 of 1995 was tagged with the above writ petition and was allowed by the same common judgment enabling all the 21 respondents to refund a part of CPF (Govt. Contribution) or agree for adjustment, to obtain pensionary benefits.

2. The respondents filed the writ petition in 1992 claiming that they were appointed originally in a department of PEPSU described as PEPSU Roadways, between January 1955 and September 1956. It is not in dispute that in the PEPSU Roadways the respondents’ appointment was only on temporary basis. PEPSU Roadways lost its utility due to creation of PEPSU Road Transport Corporation (hereinafter referred to as the ‘Corporation’). Copy of notification dated 07.01.1956 available on record shows that Corporation was created by this notification under the provisions of the Road Transport Corporation Act, 1950 enforced with effect from 10.08.1954. The State Government through the Chief Secretary issued a letter dated 16.10.1956 informing the General Manager, PEPSU Roadways, Patiala (with reference to PEPSU Roadways’ communication dated 14.10.1956) that His Highness the Rajpramukh had ordered the transfer of PEPSU Roadways to the PEPSU Road Transport Corporation (with effect from 15.10.1956 forenoon) on various terms and conditions in respect to evaluation of the assets of the PEPSU Roadways as well as sharing the burden for payment of the employees of the Corporation. The letter indicates that the Corporation was requested to draw up the agreement required by clause (h) of sub-section (2) of Section 19 of the Road Transport Corporation Act, 1950 and forward the same to the Government for approval and signatures. On account of the States Reorganization Act the merger of State of PEPSU with the State of Punjab became effective from 01.11.1956. Through an Order no. 61 dated 30.11.1956 the Corporation admitted that PEPSU Roadways stood taken over by the Corporation from 16.10.1956 (before noon), so the services of all the temporary employees stood transferred to the Corporation with effect from 16.10.1956 on the prevailing terms and conditions till the approval of new terms and conditions by the Corporation. The respondents never challenged this declaration, got promotions etc. and continued to serve the Corporation till they all retired between 1989 and 1991. It is not in dispute that PEPSU Road Transport Corporation Regulations which was framed in 1957 provided for Contributory Provident Fund (CPF). There was no provision for grant of pension. Much after the retirement of the respondents, only with effect from 15.06.1992 the Corporation framed PRTC Employees Pension/Gratuity and General Provident Fund Regulations, 1992 (hereinafter described as ‘Regulations of 1992’). Under these Regulations, for the first time pension was introduced in the Corporation.

3. Soon after the enforcement of Regulations of 1992 the respondents who had already received their retiral benefits under the 1957 Regulations filed the writ petition at hand. Originally the grievance of the respondents in the writ petition was as to why the Regulations of 1992 have not been made retrospective but through an amendment in 1998, the writ petition was substantially amended so as to claim that they continued to be employees of the State in the department of PEPSU Roadways till PEPSU State was reorganized and from 01.11.1956, the date of reorganization they became employees of State of Punjab with right to pension as available to Government servants. The S