1. Contract employee terminated after disciplinary enquiry for unauthorized absence and subsequently re-engaged on contract; dispute over continuity of service for regularization purposes. (Para 3 )
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2018 Supreme(SC) 1850
SUPREME COURT OF INDIA
Dhananjaya Y. Chandrachud, M.R. Shah, JJ.
Apsrtc - Appellant
Versus
Sri K. Sathaiah - Respondent
Civil Appeal No.12242 of 2018 (Arising Out of SLP (Civil) No.7807 of 2014)
Decided On : 07-12-2018
Important Points
Continuity of service can only be granted if the termination and re-engagement are challenged and adjudicated upon. Granting continuity of service to an employee found to have committed misconduct would place them on the same footing as other contractual employees with a clean record.
Subject
Employment Law - Contract Employment Dispute
Act Referred
Headnote
Continuity of Service - Employment Dispute - Article 226 of the Constitution of India - [Article 226, Writ Petition No.2786 of 2012, Writ Appeal No.864 of 2013] - The court discussed the issue of continuity of service for a contract employee who was terminated and then re-engaged, and the applicability of earlier judgments in similar cases. The court held that continuity of service could only be granted if the termination and re-engagement were challenged and adjudicated upon. Granting continuity of service to an employee found to have committed misconduct would place them on the same footing as other contractual employees with a clean record. The court also noted that the earlier judgment failed to consider the individual facts of each case, leading to a manifestly misconceived decision.
Fact of the Case:
The respondent, a contract driver, was terminated following a departmental enquiry for unauthorized absence. After a departmental review, he was re-engaged by the appellant corporation. The respondent sought continuity of service from the date of termination until re-engagement, without challenging the termination or re-engagement.
Finding of the Court:
The court found that the grant of continuity of service without challenging the termination and re-engagement was unsustainable. It also noted that granting continuity of service to an employee found to have committed misconduct would place them on the same footing as other contractual employees with a clean record. The court held that the earlier judgment failed to consider the individual facts of each case, leading to a manifestly misconceived decision.
Issues: The main issue was whether the respondent was entitled to continuity of service from the date of termination until re-engagement without challenging the termination and re-engagement.
Ratio Decidendi: The court held that continuity of service could only be granted if the termination and re-engagement were challenged and adjudicated upon. Granting continuity of service to an employee found to have committed misconduct would place them on the same footing as other contractual employees with a clean record. The court also noted that the earlier judgment failed to consider the individual facts of each case, leading to a manifestly misconceived decision.
Final Decision: The appeal was allowed, and the impugned judgment and order were set aside. The seniority of the respondent workman was to be counted with effect from the date of his fresh appointment in the service of the Corporation. No costs were awarded.
Legal Category Hierarchy
Advocates Appeared:
Arjun Krishnan, Advocate, For the Appellants; Tanmaya Agarwal, Advocate, For the Respondents
Arjun Krishnan, Advocate, For the Appellants; Tanmaya Agarwal, Advocate, For the Respondents
Table of Contents
2. Corporation contends continuity cannot be granted where termination and fresh appointment were not challenged and a disciplinary enquiry had established misconduct. (Para 6 )
3. High Court erred by applying a general batch order without considering individual facts and the fact that termination was not challenged. (Para 8 , 11 , 12 )
4. Continuity of service is granted only when a termination order is set aside; otherwise, seniority begins from the date of fresh appointment. (Para 9 , 10 )
5. Appeal allowed; High Court orders set aside; seniority to be counted from the date of fresh appointment. (Para 13 , 14 )
6. Under what circumstances is continuity of service typically granted after termination?
As a matter of first principle, continuity of service is granted when an order of termination is set aside to ensure that there is no hiatus in service. (Para 9 )
7. Does a fresh appointment after termination automatically entitle an employee to continuity of past service?
No. Unless the order of termination and the fresh appointment are challenged and adjudicated upon, seniority necessarily counts from the date of the fresh appointment. (Para 9 )
8. Can continuity of service be granted to an employee re-engaged after being terminated for misconduct?
No. Granting continuity of service to a person found to have committed misconduct would unfairly place them on the same footing as other contractual employees who have a record without blemish. (Para 10 )
JUDGMENT
M.R. Shah, J. - Leave granted.
2. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 11.06.2013 passed by the Division Bench of the High Court of Judicature of Andhra Pradesh at Hyderabad in Writ Appeal No.864 of 2013 by which the Division Bench dismissed the same appeal and confirmed judgment passed by the learned Single Judge dated 18.07.2012 in Writ Petition No.17541 of 2012 directing the appellants herein-original respondents to extend the benefit of continuity of service to the workman from the date of termination till the date of re-engagement except for the period when he was absent and that would be without monetary benefit and that it would be granted only for the purpose of regularization at a later date, the original respondents- Corporation-employer have preferred the present appeal.
3. The facts leading to the present appeal are as under :
a. That the respondent herein-original writ petitioner was appointed as a contract driver and working with the appellant corporation.
b. That a departmental enquiry was initiated against him for remaining on unauthorized absence.
c. Following the report of the Enquiry Officer, his services came to be terminated.
d. After the dismissal of the departmental appeal, and in the course of the departmental review, the Divisional Manager issued an order for the reengagement of the respondent on contract on 06.07.2012.
e. After the re-engagement, the respondent invoked the jurisdiction of the High Court under Article 226 of the Constitution of India and prayed for continuity of service together consequential service benefit.
4. The learned Single Judge allowed the petition, holding that the matter was not res integra and was covered by an earlier judgment of a learned Single Judge dated 29.02.2012 in Writ Petition No.2786 of 2012 . Though on behalf of the Corporation an effort was made to distinguish the earlier decision on the ground that in the present case after full-fledged enquiry has been held, this distinction did not find acceptance by the learned Single Judge. On the contrary, it was held that in the previous case, the learned Judge had found that the enquiry was not in keeping with the principles of natural justice. Moreover, in the view of the Single Judge, once the Corporation had granted a largesse in the form of a fresh employment, the workman should not be deprived of the benefit of continuity of service for the limited purpose of regularisation. Hence, in terms of the direction in the earlier decision, the petition was disposed of by directing the Corporation to extend the benefit of continuity of service to the workman from the date of termination until the date of his re-engagement except for the period when he was absent. This was, however, without any monetary benefit and was directed to count only for regularisation.
5. It is the above order of the learned Single Judge which was affirmed by the Division Bench in a Writ Appeal.
6. Mr. Gourab Banerji, learned senior counsel appearing on behalf of the appellants submits that there was a manifest error on the part of both the learned Single Judge and the Division Bench. In the present case, a disciplinary enquiry was held against the workman after which an initial decision was taken to terminate him from service. In a departmental review, he was granted fresh appointment. Neither the termination nor the order granting him fresh appointment as a contract driver were challenged. As a matter of fact, it has also been submitted that in certain other cases, the workmen had taken recourse to proceedings before the Industrial Court but in the present case that was not done. Be that as it may, the learned Single Judge relied on the earlier decision and issued directions, to govern the entire batch of cases. This direction was confirmed by the Division Bench without having regard to the facts of individual cases.
7. Since the order of the learned Single Judge in the present case, was exclusive
