The closure of a project for justified reasons does not grant employees a vested right to continue, and termination in accordance with appointment terms is valid.

Rajiv Narain Raina, J.

1. The petitioners had spent about 22 to 25 years working as Bal Sevikas in the Demonstration Project (for short "Project") run by the Haryana State Social Welfare Board, Chandigarh in a scheme floated by the Central Social Welfare Board, New Delhi when the Project was closed rendering them surplus employees. They assail their termination orders upon closure and secondly, claim adjustment in a main stream department of the Government by absorption.

2. The financial aid to the Project was provided by the Ministry of Human Resources Development, Government of India, New Delhi. The Central Social Welfare Board is incorporated as a company registered under the Companies Act, 1956. The administrative, functional and financial control of the Haryana Board lies with the Central Social Welfare Board.

3. Respondent No.1 in its reply has raised objection as to maintainability of the petition asserting that neither the Project nor the Central Board or the State unit is a "State" within the meaning of Article 12 of the Constitution of India. The entity has not been created by a Statute or under a Statute. The HRD Ministry had decided to close down the Project and to this end had issued letter dated December 31, 2004 to the Project managers after a prior decision was taken in the meeting of the Committee of Secretaries held on April 28, 2004 deciding that the Department of Women & Child Development had to phase out three programmes, namely, Border Area Project, Welfare Extension Project and the Demonstration Project, the last of which we are concerned with in this petition.

4. Accordingly, the Central Board was directed to abolish the Project. Since the financial aid was being provided by the Ministry of HRD, therefore, the Central Board was bound to follow the orders dated December 31, 2004 and therefore the State Board and the three Projects. In compliance of the order, the Central Board, by letter dated June 02, 2005 ordered the Haryana State Social Welfare Board to close down the Project in view of the orders passed by the competent authority in the Central Government. The Central Board by another letter dated September 27, 2005, again wrote to the Haryana State Social Welfare Board that the Project was functioning as a scheme of the Central Board and it cannot be treated as a permanent establishment. In short, the Project was closed down. This led to the passing of the impugned orders of termination of the 18 petitioning Bal Sevikas.

5. The respondent No.1, however, admits in the written statement that the petitioners are entitled to Contributory Provident Fund, Leave Encashment and Gratuity. Nevertheless, they are not entitled to pension and other pensionary benefits. The post held by the petitioners was not a pensionable job. The Punjab Civil Services Rules as applicable to Haryana are not applicable to the petitioners. The department admits that the services of the petitioners were regularized by order but they clarify that their services were regularized for the purposes of Project alone and no right can be claimed by them when the Project itself has been closed down. The petitioners are not and nor were government employees. They have not the protection of Article 311 of Constitution of India. The prayer of the petitioners that they be absorbed in the different departments of the Government cannot be answered by the Haryana State Social Welfare Advisory Board. This power is vested in the State Government. It is argued that the Board is not part and parcel of State Government machinery. Absorption after declaration of surplus or on closure of Project is subject to public policy. There is no such decision of the State Government to absorb the petitioning Bal Sevikas in any other department of the Government.

6. The only issue which can be reviewed judicially is whether the closure was bona fide act with a drying up of funding by the Ministry of Human Resources Development, Government of India. No right ac