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2026 Supreme(Online)(Mad) 50464
IN THE HIGH COURT OF JUDICATURE AT MADRAS
2026:MHC:2153
WA No. 1292 of 2026 and batch
WA NO. 1324 OF 2026, WA NO. 1319 OF 2026, WA NO. 1322 OF 2026, WA NO. 1306 OF 2026, WA NO. 1321 OF 2026, WA NO. 1269 OF 2026, WA NO. 1275 OF 2026, WA NO. 1273 OF 2026, WA NO. 1305 OF 2026, WA NO. 1320 OF 2026, WA NO. 1318 OF 2026, WA NO. 1308 OF 2026, WA NO. 1310 OF 2026, WA NO. 1299 OF 2026, WA NO. 1301 OF 2026, WA NO. 1298 OF 2026, WA NO. 1290 OF 2026, WA NO. 1288 OF 2026
N. Geetha Lakshmi ..Appellant(s)
Vs
1. The Government of Tamil Nadu
Rep By Additional Chief Secretary To Government,
Rural Development And Panchayat Raj Department,
Secretariat, Chennai-600 009
2. The Director Of Rural Development and Panchayat Raj, Chennai-600 015
3. The District Collector, Dharmapuri District, Dharmapuri
4. The Project Director Cum Member Secretary, Dharmapuri District Socio Economic Development Society, Dharmapuri
5. The Secretary, Tamil Nadu Public Service Commission, TNPSC Road, Park Town, Chennai ..Respondent(s)
Writ Appeal filed under Clause 15 of the Letters Patent issuing writ of certiorari mandamus to set aside the order passed in W.P.No.2642 of 2025 dated 11.11.2025 and allow the same.
In all cases
In all Writ Appeals
For Appellant(s): Mr.R.Syed Mustafa & Mr.T.Sundaravadanam for M/s.B.Saravanan Associates
For Respondent(s): Dr.R.Gouri, Government Counsel for R1 to R4
THE HON'BLE MR JUSTICE S. M. SUBRAMANIAM AND THE HON'BLE MR.JUSTICE N.SENTHILKUMAR
DATED: 10-06-2026
For the Appellants/Petitioners: R.Syed Mustafa, T.Sundaravadanam, B.Saravanan
For the Respondents: R.Gouri
Absorption of employees from a wound-up entity into government service is a discretionary concession, not a vested right. Employees who have already reached the age of superannuation and received terminal benefits cannot claim subsequent regularization or absorption.
Headnote:(A) Employment Law - Absorption of employees - Conversion of wound-up state-owned company employees into government service - Whether such absorption can be claimed after superannuation - Held, absorption of employees of a wound-up company into government service is a policy-based concession and not an indefeasible right - Once employees reach the age of superannuation and have received terminal benefits from their parent organization, they cannot claim regularization or absorption in the government department as they have ceased to be in service. (Paras 3, 4)
Facts of the case:
The appellants were former employees of a state-owned company that was ordered to be wound up. A government policy was introduced to facilitate the absorption of these employees into a government department. While proposals for absorption were initiated, they did not materialize before the appellants attained the age of superannuation. Having retired and received their full terminal benefits from the parent company, they challenged the rejection of their subsequent claims for regularization and absorption.
Findings of Court:
The court observed that the absorption of the appellants was a concession offered by the government but could not be implemented due to the appellants reaching the age of superannuation and their subsequent retirement. Since their service with the original company had concluded and terminal benefits had been settled, there existed no legal basis to compel the government to absorb them post-retirement.
Issues: The main issue was whether former employees of a wound-up government-owned company, who have already attained the age of superannuation and received terminal benefits, are entitled to claim absorption in a government department as a matter of right.
Ratio Decidendi: Absorption of employees from a defunct entity into government service is a discretionary policy concession. Once a person has attained the age of superannuation and their employment relationship has formally ended through retirement and the settlement of terminal dues, the right or capacity to be regularized or absorbed ceases to exist.
Result: Writ appeals dismissed.
COMMON JUDGMENT
(Judgment of the Court was delivered by S.M.Subramaniam J.)
The issues involved in the batch of intra-court appeals are one and the same. Thus, writ appeals are taken up together and a common order is passed.
2. Writ petitioners are appellants. Challenging the order of rejection, dated 23.08.2024 rejecting the claim of the appellants for regularisation and absorption of their services in Rural Development and Panchayat Raj Department, the appellants preferred writ proceedings.
3. It is not in dispute that the company designated as Dharmapuri District Development Corporation Limited (hereinafter referred to as “DDDCL”), registered under the Companies Act, 1956 and owned by the Government, was ordered to be wound up. A policy decision was taken to absorb the employees of DDDCL into the Government department of Rural Development and Panchayat Raj in a phased manner. As far as writ appellants herein are concerned, proposals were submitted to the Government department for their absorption. In this regard, Government issued G.O.Ms.No.61, Rural Development (SGSY) Department, dated 06.06.2003, formed Dharmapuri District Socio-economic Development Society for absorption of erstwhile employees of DDDCL either in the newly formed Society or in the Rural Development Department. In view of the decision, proposals were also placed before the department. However, the proposals were not materialized, in view of the fact that these employees of the Government-owned company that was wound up could not be accommodated in certain posts for which concurrence of the Tamil Nadu Public Service Commission is required. Pertinently, all the appellants herein attained the age of superannuation and retired from service. Therefore, there is no scope for absorbing them in the Department of Rural Development and Panchayat Raj. When writ appellants have already crossed the age of superannuation and received financial settlements for their services rendered in the Government-owned company, now they cannot claim regularisation or absorption in any other department as a matter of right.
4. It is not in dispute that terminal benefits due to the appellants were settled by the Corporation for the services rendered by them in the company. Absorption of these appellants in the Government department is a concession given, and it could not be materialised, in view of the fact that appellants have already attained the age of superannuation. Therefore, decision arrived by the Writ Court is in consonance with the principles and there is no infirmity in the order passed.
5. Accordingly, the writ appeals are dismissed. No costs. Consequently, the connected miscellaneous petitions, if any, are closed.
