The past service of employees in a private institution cannot be completely disregarded when determining their eligibility for promotion after the institution is taken over by the Government.

R. N. MISRA, J.

( 1 ) IN the town of Berhampur within the district of Ganjam is located an educational institution known by the name of Khallikote College. The said institution was founded in the year 1856 as a High School. In 1878, the Intermediate Classes were opened and the College affiliated 'to the Madras University. In 1888, the management was transferred to a local committee, but owing to financial crisis the institution was threatened with closure. The then Zamindar of Khallikote raised a liberal endowment and in terms of a deed of trust dated 13-7-1896 the institution came to have its name as Khallikote College. The institution became one of the premier colleges of the area and in due course came to be affiliated to the Andhra university at Waltair. Thereafter, in 1943, with the creation of the Utkal University, affiliation to that University was granted, and ultimately with effect from 1967 the said College has now been affiliated to the Berhampur University. For quite some time negotiation was going on between the State of Orissa and the management of the College, so that the institution may be taken over by the State government. On 18-2-70, the Managing Committee (opp. party No. 1) resolved to place the administration of the College in the hands of the State Government. From July 1970 the State Government appointed one of the senior Professors as the Principal of the College. On 9-3-1971, a formal agreement was executed between the Management and the Governor of the State providing-

" X X X whereas Government have agreed to take over the Management of the college along with its assets provided they are not saddled with any existing liabilities. And whereas by its resolution dated 18-2-70 the transferor Managing committee unanimously resolved to transfer the management of the college with all its assets described in the schedule below and that without any liability. X X X X now the deed witnesses as follows:- (1) That the transferor hereby transfers to Government the management of the Khallikote College along with its B. Ed. Section to be administered hereafter by the Government as a Government College. (2) That the assets of the College described in the schedule below which are at present being administered by the transferor are hereby transferred to Government free of any cost to be held by Government absolutely for ever for the benefit of the College. (3) That the transferor shall be liable for the outstanding liabilities, if any, of the College for which Government shall not be liable. (4) That the transferor hereby agrees to execute any document or deed that might be required for the purpose of giving effect to this transfer be necessary hereinafter. (5) That the transferor shall indemnify the Government against any claim that might arise hereinafter in connection with the administration of the college along with its assets described in the scheme appended hereto. X X X X X "

( 2 ) THE eight petitioners in this case were working as Readers in different faculties in the said College on the date of the aforesaid transfer in the scale of pay of Rs. 510-860. The petitioner No. 6 was the earliest recruit having joined the College as early as 3-9-57. The last of the petitioners to be recruited to the employment of the College was the petitioner No. 8 and he joined the College on 2-8-62. As shown in Annexure 1 (Nos. 9 and 10 therein are not petitioners) to the writ petition, excepting the petitioners 3, 5 and 8 who have been confirmed as lecturers the other petitioners have been confirmed as Readers. The petitioners had obtained their promotions as Readers between 1-1-67 and 5-7-70.

( 3 ) ON 23-3-71, Government provided the conditions governing the taking-over of the services of the teaching staff of the College (Annexure 7 ). Paragraph 4 of the said letter provided as follows:--

"the State Government shall offer ad hoc appointment to all staff in position on the date of take-over subject to para 5 and sub-para (d) o