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2017 Supreme(SC) 1735
SUPREME COURT OF INDIA
ADARSH KUMAR GOEL, UDAY UMESH LALIT, JJ.
U.P. CO-OP. SPINNING MILLS FEDN. LTD. & ORS - APPELLANTS
VERSUS
AMAR NATH DWIVEDI & ANR - RESPONDENTS
CIVIL APPEAL NO.5491 of 2007 WITH CIVIL APPEAL NO.3652 OF 2017 (SPECIAL LEAVE PETITION (CIVIL) NO. 34308 OF 2014) And CIVIL APPEAL NO.3653 OF 2017 (SPECIAL LEAVE PETITION (CIVIL) NO. 1708 OF 2015)
Decided On : 02-03-2017
Contractual appointments for a fixed term without a sanctioned permanent post do not entitle the employee to permanency. Similarly, claims for absorption into state services via deputation fail if permanent employment status with the parent organization is not established.
Headnote:(A) Service Law - Contractual Appointment - Termination of fixed-term contract - Whether appointment on a contractual basis for a specified period is arbitrary in the absence of a sanctioned permanent post - If the appointment letter and agreement clearly specify a contractual term and no sanctioned post of a permanent nature exists on record, the termination upon the expiry of the contract period is valid and cannot be deemed arbitrary.
(B) Deputation - Absorption into State services - Claim for absorption based on deputation requires proof of permanent employment with the parent organization - If the employment with the parent organization is found to be merely contractual, the entitlement to claim absorption in state services on the basis of being on deputation cannot be sustained.
Facts of the case:
An individual was appointed as a Training Officer on a contractual basis for a fixed period of one year. Upon the expiration of the contract, the service was terminated. The individual challenged the termination, and the High Court subsequently ordered reinstatement with back wages, characterizing the contractual appointment as arbitrary. It was further claimed that the individual had been sent on deputation to the state from the parent organization and therefore sought absorption into state services.
Findings of Court:
The court found that the appointment was explicitly contractual for a limited period as per the appointment letter and agreement. There was no evidence of a sanctioned permanent post against which the appointment could have been made permanent. Consequently, the High Court's direction for reinstatement was unsustainable. Furthermore, since the status as a permanent employee of the parent organization was not established, the claim for absorption into state services via deputation failed.
Issues: Whether a fixed-term contractual appointment without a sanctioned permanent post can be treated as permanent, and whether a claim for absorption into state services can be maintained if the parent employment was only contractual.
Ratio Decidendi: Where an appointment is clearly contractual for a specified period and there is no sanctioned permanent post, the termination of service upon the expiry of the contract is legally sustainable. A claim for state service absorption based on deputation is contingent upon the claimant holding a permanent position in the parent organization; without such status, the claim for absorption is invalid.
Result: Appeals allowed.
Legal Category Hierarchy
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administrative law
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public employment
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appointment
- contractual appointment
- permanent appointment
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deputation
- absorption
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termination
- reinstatement
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appointment
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public employment
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practice and procedure
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appeal
- special leave petition
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remedies
- back wages
- reinstatement
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appeal
Respondent No.1 was appointed on 'contractual basis' on the post of a Training Officer in the U.P. Co-operative Spinning Mills Federation Limited vide letter of Appointment dated 07.09.1998. As per agreement, the contract of appointment was for a period of one year from 25.09.1998 to 24.09.1999, which stood terminated on 24.09.1999.
After being relieved from service, the Respondent Ro.1 filed the Civil Misc. Writ Petition No. 35625 of 2000 before the High Court of Allahabad which was dismissed on 17.01.2002. However, the order of the learned Single Judge was set aside by the Division Bench in Special Appeal No. 282 of 2002 vide order dated 05.07.2002 and the matter was remanded to the learned Single Judge for a fresh consideration. Thereafter, the learned Single Judge allowed the writ petition of the respondent and reinstated him in service with back wages vide order dated 16.07.2002. It was held that the conditions in the appointment letter of the respondent, treating the appointment as contractual was arbitrary. This view has been upheld by the Division Bench by the impugned judgment.
While issuing notice on 20.11.2006, this Court stayed the operation of the impugned order which was continued while granting leave.
We have heard learned counsel for the parties.
It is clear from the letter of appointment dated 07.09.1998 that the appointment of the respondent was on contractual basis and in terms of Agreement dated 25.09.1988 the contract of appointment was for a period of one year which was never extended. There is nothing on record to show that there was any sanctioned post of permanent nature against which the respondent was appointed on permanent basis. Thus, the direction contained in the impugned order cannot be sustained and the impugned order is set aside.
The appeal is, accordingly, allowed.
Civil Appeal No.3652/2017 (@ Special Leave Petition (civil) NO. 34308 of 2014)
Leave granted.
This appeal has been preferred by the State of U.P. against the direction in the impugned order to the effect that employees working on deputation belonging to Public Sector Undertakings, (which had become sick) were required to be protected. The respondent claimed to have been sent on deputation to the State of U.P. by the U.P. Co-operative Spinning Mills Federation Limited. According to the respondent his appointment with the U.P. Co-operative Spinning Mills as of permanent nature which claim was accepted by the High Court in its judgment dated 08.08.2007. The said judgment has been set aside in Civil Appeal No. 5491 of 2007.
In view of above, the claim of the respondent that he was in permanent employment of the U.P. Co-operative Spinning Mills Federation Limited and in that capacity he was on deputation falls to the ground. On that basis his entitlement to claim absorption in the State services can not be sustained.
Accordingly, the impugned order of the High Court is set aside and the appeal is allowed.
CIVIL APPEAL NO.3653/2017 (@ SPECIAL LEAVE PETITION (CIVIL) NO.1708 OF 2015)
Leave granted.
In view of the order passed in Civil Appeal No.3652/2017 (@ SLP(C)No. 34308/2014), this appeal is allowed and the impugned order is set aside.
It may, however, be noted that even though we have held that respondent-Amar Nath Dwivedi has no locus to claim employment under the State, the State is not debarred from engaging services of respondent, if the State is so advised, on such terms and conditions, as may be found to be appropriate in accordance with law. We do not express any opinion on future course of action which the State of U.P. may adopt.
