Dharam Singh v. State of U.P. (2025): Judicial Review of “Financial-Constraint” Refusals and a New Constitutional Duty to Regularise Perennial Daily-Wage Workers

1. Introduction

The Supreme Court of India’s decision in Dharam Singh & Ors. v. State of U.P. & Anr., 2025 INSC 998, tackles a recurrent strain in Indian public employment: decades-long engagement of daily-wage workers on posts that are in truth perennial. Six employees of the U.P. Higher Education Services Commission (five Class-IV attendants and one driver) had worked continuously since 1989-1992. The Commission itself requested creation of fourteen regular posts, but the State twice rejected the proposal citing generic “financial constraints.” The High Court of Allahabad dismissed the workers’ writ petition and subsequent intra-court appeal, leaning heavily on the celebrated Constitution Bench decision in Secretary, Karnataka v. Umadevi (2006) 4 SCC 1 (Umadevi).

The Supreme Court has now reversed that dismissal, quashed the State’s refusals, and—by directing creation of supernumerary posts—effectively regularised the appellants with consequential monetary benefits. In doing so, the Court promulgates an important principle: an executive refusal to sanction posts for work that is perennial and already being performed by long-term daily wagers is subject to strict judicial review, and Umadevi cannot be used as a shield to perpetuate “ad-hocism.”

2. Summary of the Judgment

The High Court erred by treating the dispute merely as a plea for regularisation and ignoring the primary challenge to the State’s refusal to create posts.
The State’s orders (11-11-1999 and 25-11-2003) rejecting the Commission’s proposal were non-speaking, relied solely on financial stringency, and were therefore arbitrary and violative of Articles 14, 16 and 21.
The Court quashed those refusals, declared the work “perennial,” and held that prolonged daily-wage engagement for such work is unconstitutional.
Directed the State and the successor body (U.P. Education Services Selection Commission) to:
- Create necessary supernumerary posts for Class-III (Driver) and Class-IV roles.
- Regularise all six appellants from 24-04-2002 (the date of earlier HC directions), grant pay protection, arrears, pensionary recalculations, and interest for delayed payments.
- File a compliance affidavit within four months.
Clarified that organisational restructuring or later outsourcing policies cannot extinguish accrued rights.

3. Analysis

3.1 Precedents Cited and Their Influence

Secretary, State of Karnataka v. Umadevi, (2006) 4 SCC 1

Established that public employment must adhere to constitutional mandates (Arts. 14 & 16), disallowed direct regularisation of illegal appointments, but recognised a window for ‘irregular, long-term’ engagements where the State had failed to undertake proper recruitment.
The High Court applied Umadevi mechanistically. The Supreme Court distinguished it, stressing that the appellants were not seeking to bypass recruitment rules—rather they challenged the arbitrariness of not creating posts in the first place. Thus Umadevi remains good law but cannot legitimise indefinite casualisation.
Jaggo v. Union of India, 2024 SCC OnLine SC 3826
Cautioned against misuse of temporary engagements, especially in the public sector. The Court borrowed its critique of the “gig-economy mindset” to underline why perpetuating casual status violates dignity of labour.
SHRIPAL v. NAGAR NIGAM, GHAZIABAD, 2025 SCC OnLine SC 221
Held that municipalities cannot rely on outsourcing or fiscal excuses to deny regularisation where horticulture workers had rendered decades of service. Excerpts reproduced in Dharam Singh fortify the ratio that exploitative ad-hocism is unconstitutional.
General principles from service-law and labour-law jurisprudence—e.g., adverse inference for missing muster-rolls, prohibition on discrimination among similarly situated employees—also guided the Court.

3.2 Court’s Legal Reasoning

Scope of Judicial Review: Creation of posts is an executive function, but a refusal can be struck down if based on irrelevant or no reasons (arbitrariness test). Vague references to fiscal crisis, without data or exploration of alternative measures, fail this test.
Perennial Nature of Work: Evidence showed uninterrupted duties identical to regular staff. A need that persists over decades automatically negates the “temporary” label.
Equality and Non-Discrimination: Some similarly situated workers within the same Commission had been regularised earlier; denying the appellants identical treatment breaches Article 14.
Reading Umadevi Harmoniously: The Court emphasised that Umadevi condemned arbitrary appointments, not remedial regularisation where the State itself defaults in creating sanctioned posts.
Constitutional Employer Doctrine: The judgment reiterates a higher standard for Government as an employer—financial management cannot justify systemic exploitation.
Remedial Architecture: Instead of a mere mandamus, the Court set out detailed, time-bound directions (supernumerary posts, back-wages, interest, compliance affidavit) to convert rights into enforceable outcomes.

3.3 Likely Impact on Future Litigation and Administration

Elevated scrutiny of “financial-constraint” defences: Government departments will have to produce cogent evidence and explore alternative solutions before rejecting proposals for necessary staff.
Doctrine of Perennial Work Regularisation: Where work is continuous and identical to sanctioned posts, courts can compel creation of posts or order supernumerary absorption.
Supernumerary Posts as a Remedial Tool: The judgment popularises supernumerary creation to avoid unsettling sanctioned strength yet granting workers their dues.
Reduced shield of Umadevi: Public bodies can no longer cite Umadevi without demonstrating bona fide attempts to hold regular recruitment.
Administrative Record-Keeping Obligations: The Court’s insistence on muster-roll transparency will spur departments to maintain accurate, accessible employment data.
Incentive to Restructure HR Practices: Departments that habitually rely on casual labour may pre-empt litigation by regularising staff or conducting recruitment drives.

4. Complex Concepts Simplified

Perennial Work: Tasks that are integral and repetitive (e.g., clerical dispatch, driving) as opposed to short-term or seasonal activities.
Supernumerary Post: A temporary addition to the sanctioned cadre; allows an incumbent to draw salary and seniority benefits without increasing the permanent strength—often used as a transition device.
Ad-hocism: Practice of engaging workers on temporary, daily-wage or contractual basis for long periods without following formal recruitment or granting service benefits.
Judicial Review of Administrative Action: Courts can invalidate government decisions if they are arbitrary, mala fide, irrational, or procedurally unfair.
Articles 14, 16 & 21 of the Constitution:
- Article 14 – Equality before the law and equal protection of the laws.
- Article 16 – Equality of opportunity in matters of public employment.
- Article 21 – Protection of life and personal liberty; interpreted to include right to livelihood and dignity of labour.
Financial Constraint Defence: Government’s claim that budgetary limitations prevent certain actions. Post-Dharam Singh, such a defence must be reasoned, evidenced and proportionate.

5. Conclusion

The Supreme Court in Dharam Singh has fortified an emerging doctrine that perennial work deserves perennial posts. A mere label of “daily-wage” cannot eclipse decades of faithful service. More broadly, the ruling:

Re-balances Umadevi by spotlighting the State’s concomitant duty to organise its workforce properly.
Expands the arsenal of remedies—supernumerary posts, quantified arrears, and mandatory compliance affidavits—that transform judicial declarations into tangible relief.
Signals that opaque, blanket invocations of “financial constraints” will no longer suffice; transparency and evidence are indispensable.

In the continuing tussle between fiscal prudence and workers’ rights, Dharam Singh tilts the scale toward constitutional fairness. It reminds public employers that economies cannot be achieved at the expense of dignity, equality, and the promise of secure livelihood that the Constitution extends to every worker who keeps India’s governance machinery functioning.