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2025 Supreme(Mad) 4611
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
S.M.SUBRAMANIAM, A.D.MARIA CLETE, JJ.
The Commissioner, Hindu Religious and Charitable Endowments Department - Respondent
Versus
N.Kannan (died) - Respondent
W.A(MD)No.504 of 2019 and C.M.P(MD)No.4319 of 2019
Decided on : 05-06-2025
Advocate Appeared:
For the Appellants :Mr.R.Baskaran Additional Advocate General Assisted by Mr.S.P.Maharajan
For the Respondent: Mr.H.Velvadhas
The court affirmed that employees permanently absorbed under specific conditions in government employment cannot claim benefits beyond those stipulated in their absorption terms.
Headnote:(A) Government Orders - G.O.Ms.No.172 & G.O.Ms.No.27 - Employment law principles - Terms of permanent absorption affirmed; pay protection granted but no claim for seniority or promotion rights based on previous employment - Employees accepting terms cannot claim benefits outside those stipulated. (Paras 5-10)
(B) Constitutional Contract - Government employment as contractual; service conditions binding for both parties - Alteration to disadvantage of employee not permissible. (Paras 10-11)
Facts of the case:
The deceased was absorbed permanently in the HR & CE Department after the closure of the Tamil Nadu State Construction Corporation Limited with specific terms limiting benefits based on prior service.
Findings of Court:
The appellants directed to settle service benefits separately for the Tamil Nadu State Construction Corporation Limited and the HR & CE Department as per applicable rules.
Issues: Whether the deceased was entitled to additional benefits beyond those specified in the absorption terms.
Ratio Decidendi: The court held that employees accepting absorption terms are bound by them and cannot claim additional benefits not stipulated.
Result: Writ order set aside; Writ appeal allowed.
| Table of Content |
|---|
| 1. challenge of writ order regarding employee absorption and service benefit. (Para 3 , 4 , 5 , 6) |
| 2. details of related government orders on employee absorption. (Para 7 , 8) |
| 3. acceptance of service conditions binds both employer and employee. (Para 10 , 11) |
| 4. final orders regarding entitlement to benefits. (Para 12 , 13 , 14) |
JUDGMENT :
S.M.SUBRAMANIAM, J.
The Writ Order dated 18.01.2019 passed in W.P(MD)No.10396 of 2015 is under challenge in the present intra-court appeal.
2. The State is the appellant herein.
3. Pending the Writ Appeal, the first respondent died and his legal heirs were brought on record as respondents 4 to 7 in the Writ Appeal.
4. The deceased first respondent was appointed as a Junior Assistant on 01.07.1984 in the Tamil Nadu State Construction Corporation Limited, Chennai, a public sector undertaking. He completed his probation period and was promoted to the post of Assistant Grade on 14.05.2003. He was upgraded to the post of Selection Grade Assistant on 28.02.2005. He was subsequently absorbed as a contract employee in the Hindu Religious and Charitable Department (in short hereinafter referred to as 'the HR & CE Department') in view of the fact that the Tamil Nadu State Construction Corporation Limited sustained huge loss and unable to run the company. In order to provide employment to the employees working in the Tamil Nadu State Construction Corporation Limited, the Government has made an attempt to absorb these employees in various Departments wherever vacancies are available. This was a concession granted by the Government. Government company if closed or wound up, the employees are entitled to the benefits as applicable under the Service Rules or under the scheme framed for winding up of a company. However, in the present case, the Government provided alternate employment, since the Tamil Nadu State Construction Corporation Limited was a State-owned undertaking.
5. Consequently, the deceased first respondent was appointed as a contract employee in the HR & CE Department. On completion of two years of service, a proposal for his permanent absorption was sent to the Government. The Government considered the proposal sent by the Commissioner, HR & CE Department and issued G.O.Ms.No.172, Tamil Development, Hindu Religious Endowment and Information (R.E.2-1) Department, dated 01.07.2009. The proposal was submitted in respect of 14 employees, who are accommodated in the HR & CE Department. The Government Order unambiguously states that alternate employment and regularization as a permanent absorption in a sanctioned post were granted to these employees, subject to the terms and conditions. As per the conditions stipulated in the said Government Order, pay protection alone will be granted to these employees. However, in respect of promotion, seniority and other service benefits, the services rendered by them in the Tamil Nadu State Construction Corporation Limited will not be considered. Therefore, the employees served in the Tamil Nadu State Construction Corporation Limited were permanently absorbed in the HR & CE Department on condition that their pay will be protected, but the services rendered in the Tamil Nadu State Construction Corporation Limited will not be taken into consideration for grant of promotion or any other benefits.
6. The conditions in G.O.Ms.No.172, Tamil Development, Hindu Religious Endowment and Information (R.E.2-1) Department, dated 01.07.2009, were issued based on the common directives issued by the Finance Department (Nodal Department) in G.O.Ms.No.27, Finance (BPE) Department, dated 24.01.2007. The said Government Orders speaks about the terms and conditions for the permanent absorption of employees from State public sector undertaking/Co-operative institutions.
7. Para 3(v) of the Government Order in G.O.Ms.No.27, Finance (BPE) Department, dated 24.01.2007, reads as follows:
“(v) The employees to be absorbed in the undertakings/Government Departments will be given pay
