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Smt. Shipra Ghoshal And Others v. Secretary, Deptt. Of Cane, Civil Secretariat, Lucknow And Others

Allahabad High Court

Dec 16, 1989

Judgment

Subsequent
References

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Bench: U.C. Srivastava and S.H.A. Raza, JJ. — Summary of Opinion

Factual and Procedural Background

The petitions arise from termination orders issued by the U.P. Co-operative Cane Union Federation Limited, Lucknow, affecting employees who were initially appointed for 90 days (with some extensions) but whose services were ultimately terminated. Multiple writ petitions were filed (Writ Petns. Nos. 2284/1988, 2310/1988, 2386/1988, 2387/1988, 2554/1988, 3145/1988), covering employees appointed between 1983 and 1986 to posts such as Clerk, Stenotypist, Godown Incharge, Chaukidar and Peon.

The appointment letters for many petitioners mentioned pay scale and dearness allowance and sometimes stated the appointment was "purely temporary and terminable at any time." In several petitions, appointment letters did not refer to any specific scheme; in at least one petition (No. 2310/1988) the appointments were said to be made with concurrence of the Cane Commissioner under the Rural Construction Scheme.

The petitioners challenged termination orders on multiple grounds (see below). This Court initially granted interim relief; because salaries were not being paid, a contempt petition under the Contempt of Courts Act was filed and thereafter the Federation began paying the petitioners' salaries.

Legal Issues Presented

Whether the termination of petitioners' services was lawful where petitioners had worked continuously (240 days in a calendar year) despite initial 90-day appointments, i.e., whether Section 6-N of the U.P. Industrial Disputes Act applied.
Whether termination of services amounted to retrenchment within the meaning of the Industrial Disputes Act and whether provisions identified by petitioners (Sections 25-G, 25-N, 25-T and 2-5-U as cited in the opinion) were violated.
Whether appointment on account of a particular scheme (or being sent to work in a scheme) justified termination when appointment letters did not expressly confine the appointment to a specific scheme.
Whether petitioners were entitled to regularisation/absorption into permanent posts — specifically, whether similarly situated persons appointed subsequently who were regularised created an entitlement for the petitioners to be regularised.

Arguments of the Parties

Petitioners' Arguments

The posts on which they had been working were permanent in nature; petitioners received increments and benefits (allowances, leave) akin to permanent employees and were transferred and given regular duties like other regular employees.
Some persons appointed subsequently to the petitioners were regularised; petitioners had been discriminated against and were therefore entitled to absorption/regularisation.
Termination without following statutory procedure amounted to retrenchment within the meaning of the Industrial Disputes Act; petitioners alleged violations of the provisions they cited (Sections 25-G, 25-N, 25-T and 2-5-U as stated in the opinion) and unfair labour practice.
Those appointed under a scheme had been sent to other schemes; petitioners denied the asserted closure of schemes or centres and contended the U.P. Co-operative Services Regulations, 1975 should prevail (they also referenced Section 102 of the 1975 Regulations as giving precedence).

Opposite Parties' (Respondents') Plea

The petitioners were appointed for particular schemes and those schemes were discontinued; consequently petitioners' services could not be continued.
The Federation had suffered losses and terminated certain schemes; therefore, termination was justified.
Appointments were for 90 days and mere continuance in service did not create a right to regularisation or absorption.
Applicability of the U.P. Co-operative Societies Services Regulations, 1975 was denied; it was asserted that the Federation framed its own Regulations in 1975 under Section 122 of the U.P. Co-operative Societies Act.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Jai Kishun v. U.P. Co-operative Bank Ltd., Lucknow	Held that provisions of Section 6-N of the U.P. Industrial Disputes Act are applicable to continuous employment after initial ad-hoc/daily-wage/ad-hoc appointments; Regulation 103 of the U.P. Co-operative Employees service regulations makes provisions of the Industrial Disputes Act and other labour laws applicable despite inconsistencies.	The Court agreed with the Division Bench's observations in Jai Kishun and applied that precedent: because petitioners worked 240 days continuously in a calendar year, Section 6-N applies and its procedure should have been followed; failure to do so rendered the termination orders illegal.

Court's Reasoning and Analysis

The Court's reasoning proceeded in these principal steps, following only the material and principles contained in the opinion:

Reliance on precedent: The Court accepted and followed the Division Bench's reasoning in Jai Kishun's case (supra), which held that Section 6-N of the U.P. Industrial Disputes Act applies to employees who have served continuously (even if initially appointed for brief or ad hoc periods) and that Regulation 103 makes relevant labour laws applicable despite inconsistencies in co-operative regulations.
Fact-application to Section 6-N: The petitioners had worked 240 days continuously in a calendar year. Despite initial appointments for 90 days, their continued service meant Section 6-N applied. The Court found that the procedure mandated by Section 6-N was not followed in all cases, making the terminations legally unsustainable.
Arbitrariness and failure of consideration: The Court found the termination orders arbitrary and illegal because the petitioners' cases for regularisation were not considered even though some similarly situated persons were regularised and regular appointments were later made, demonstrating that the posts existed.
Violation of principles of natural justice: The services were terminated without giving the petitioners an opportunity of hearing; this procedural defect rendered the termination orders invalid.
Incorrect reliance on "scheme" status: Many petitioners were not formally appointed for a particular scheme (no such notation in appointment letters), and being sent to work in a scheme did not justify termination when there was nothing in their appointment letters to limit their appointment to that scheme. Consequently, termination on the ground of scheme cessation was invalid for those petitioners.
Remedial direction: Given these defects, the Court quashed specified termination orders and directed the opposite parties to consider the petitioners' cases along with those of persons appointed with them or subsequently (including those who have not been terminated and some of whom have been regularised). Only after such comparative consideration, and if petitioners are found to be junior, may their services be terminated in accordance with law.

Holding and Implications

PETITIONS ALLOWED; TERMINATION ORDERS QUASHED

Holding (direct relief to parties): The Court allowed the writ petitions and quashed the termination orders specified in each writ petition (termination orders dated 4-5-1988 and 11-5-1988 as listed in the opinion for the several writ petitions). The Court ordered that the Federation must reconsider the petitioners' cases together with those of employees appointed along with or after them, and only thereafter, if it is lawfully determined that petitioners are junior, may termination follow in accordance with law.

Further consequences and practical effect:

The terminations were declared illegal because Section 6-N of the U.P. Industrial Disputes Act applied (petitioners worked continuously for 240 days) and its procedure was not followed.
The termination orders were also found arbitrary for failure to consider regularisation and for denial of an opportunity of hearing.
The Court did not award costs: "There will be no order as to costs."
The decision directs reconsideration and potential regularisation in parity with similarly situated employees; it does not itself order automatic regularisation, but it prevents termination without proper comparative consideration and compliance with statutory procedure.

Note on precedent and law-setting: The Court expressly followed existing precedent (Jai Kishun) and applied the statutory provisions; the opinion does not purport to set a new legal principle beyond applying established authority and ordering relief in the particular cases before it.

Outcome

The petitions were allowed. The specified termination orders were quashed and the Federation was directed to reconsider petitioners' claims together with similarly situated employees; no order as to costs.

Show all summary ...

U.C Srivastava and S.H.A Raza, JJ.:— In this bunch of writ petitions, the petitioners who are employees of the U.P Co-operative Cane Union Federation Limited, Lucknow and who were initially employed for a period of 90 days, which period was extended from time to time, but ultimately it was not extended and their services were terminated, have approached this Court challenging the orders of termination.

2. In Writ Petition No. 2284 of 1988, the petitioners, who are seven in number, were appointed in various months in the year 1985 on different posts including that of Clerk, Stenotypist etc. In the initial appointment letters which were issued to them, pay scale and dearness allowance was mentioned but it was not mentioned that they are being appointed in a particular and their appointments will subsist so long as the scheme is in force. In. Writ Petition No. 2310 of 1988, the petitioners were appointed in the same manner; two of them as clerks and the third as peon. In their appointment letters it was mentioned that they were being appointed with the concurrence of the Cane Commissioner under the Rural Construction Scheme.

3. In Writ Petition No. 2386 of 1988, the petitioner Nos. 1 and 2 were appointed as Godown Incharge and petitioner Nos. 3 and 4 appointed as Chaukidars without any reference to any particular scheme. Their appointments were made in the year 1983.

4. In Writ Petition No. 2387 of 1988, the petitioners were appointed as Godown Incharge in the year 1985 and their appointment letters also did not indicate that their appointments were in respect of a particular scheme.

5. In Writ Petition No. 2554 of 1988, the two petitioners were appointed as Godown Incharge in the year 1983. In their appointment letters also it was not indicated that they were being appointed under a particular scheme. It was mentioned in the appointment letter that their appointments were purely temporary and terminable at any time, but there was no break in the service and they continued to discharge their duties without any break and only in the year 1988 their services were terminated.

6. In Writ Petition No. 3145 of 1988, the two petitioners were appointed in the year 1986 on the post of Clerks. The termination order was challenged by means of amendment as earlier the termination Order was not served.

7. This Court granted interim order, but as salary was not being paid, a Contempt Petition under the Contempt of Courts Act was moved and subsequently the opposite parties started paying salary to the petitioners.

8. The petitioners have challenged the termination orders on a variety of grounds. It has been stated by them that the posts on which they are working are permanent in nature and they have been earning increments in pay and certain other benefits which are given to permanent employees accrued to the like allowances and leaves etc. and they were also transferred to certain other places and like any other regular employee they were given work. It has also, been stated by them that regular appointments were made subsequent to their appointment and the posts against which they were working are permanent posts and permanent posts are lying vacant still they have not been considered for being regularised though some of the persons similarly situated have been regularised.

9. In Writ Petition No. 2310 of 1988 in which reference to a scheme was made, it has been stated, that the Petitioner No. 1 was transferred and he was also getting benefits like other permanent employees. The petitioners have also given names of persons who were appointed subsequent to their appointment but they have been regularised. It has also been stated that there, are several persons like the petitioners who were appointed for 20 days and their services are still continuing. The termination orders have also been challenged on the ground that the posts against which the petitioners are working are permanent in nature and the posts still exist. It has been stated that certain other persons like the petitioners have been regularised but they have been discriminated and persons appointed subsequent to their appointment have been regular appointment, while they were given appointment for ninety days and, thus, they are-entitled for absorption and regularisation and their services could not have been terminated. Besides this the petitioners have stated that they were workmen and termination of their services amount to retrenchment within the meaning of Industrial Disputes Act and the provisions of Sections 25-G, 25-N, 25-T and 2-5-U of the Industrial Disputes Act have been violated and the procedure prescribed has not been followed and the termination orders, which suffer from unfair labour practice, are illegal and without jurisdiction. It has also been stated that those who were appointed in a particular scheme have been sent to another scheme.

10. Short counter-affidavits on behalf of the opposite parties have been filed and the plea which has been taken is that the petitioners were appointed for a particular scheme and the scheme have ceased to exist and as such the petitioners cannot be allowed to continue in service. It has been stated that because of loss suffered by the Federation certain schemes were put to end. There is no denial of the fact that persons appointed subsequently were given regular appointment and some of the persons like the petitioners have been regularised. It has been pleaded that the petitioners were appointed for 90 days and merely because they were allowed to continue in service, they cannot claim any right for regularisation and absorption. The applicability of the U.P Co-operative Societies Services Regulations, 1975 has also been denied. It has been stated that the U.P Co-operative Cane Unions Federation has framed its own Regulations in the year 1975 by virtue of powers conferred under Section 122 of the U.P Co-operative Societies Act.

11. The petitioners have denied the closure of the schemes or of the centres. The petitioners have pleaded that the U.P Co-operative Cane Unions Federation has framed its own Regulations, but have stated that the provisions of the U.P Co-operative Services Regulations, 1975 will prevail over the Regulations by virtue of Section 102 of 1975 Regulations.

12. With respect of the employees of the U.P Co-operative Bank Limited, Lucknow in which case initially the petitioners were appointed on daily wages basis and thereafter were given ad hoc appointments which were made to continue for years together, the Court held that the provisions of Section 6-N of the U.P Industrial Disputes Act are applicable Jai Kishun v. U.P Co-operative Bank Ltd., Lucknow(1) The Court also considered the legal position of such appointments which were made in violation of the provisions of U.P Co-operative Employees service regulations and held that Regulation 103 of the Regulations of 19751 makes the provisions of Industrial Disputes Act and other labour laws applicable even though they may be some inconsistency in the Regulations.

13. We are in agreement with the observations made by the Division Bench in Jai Kishun's case (supra). The petitioners worked for 240 days continuously in a calendar year. Notwithstanding the fact that their appointments were initially made for a period of 90 days, but they continued to remain in Service, and, as such, provisions of Section 6-N of the U.P Industrial Disputes Act are applicable. In the instant case, the provisions of Section 6-N of the Industrial Disputes Act have not been followed in all the cases and as such the orders of termination are manifestly in legal and cannot be sustained.

14. The termination order, obviously, is also arbitrary and illegal in as much as the case of the petitioners for regularisation was not considered though certain persons were regularised and subsequently regular appointments were also made meaning thereby that the posts existed. The services of the petitioners have been terminated without giving then an opportunity of hearing and thus the termination orders are equally bad on this ground also. It is to be noticed that all the petitioners were not appointed for a particular scheme and they were transferred from one place to another place. Those who were not appointed in a particular scheme could not be axed out on the ground that their appointments were made in a particular scheme particularly when there is nothing in their appointment letters to this effect. Merely because they were sent to work in a particular scheme and that scheme came to an end, their services could not be terminated on this ground. In the result, the writ petitions succeed and are hereby allowed and orders of termination of services of the petitioners of Writ Petition No. 2284 of 1988, dated 4-5-1988 contained in Annexure Nos. 21 to 27 to the writ petition; orders of termination of petitioners of Writ Petition No. 2310 of 1988, dated 4-5-1988 contained in Annexure Nos. 10, 11 and 12 of the writ petition orders of termination of services of petitioners in Writ Petition No. 2386 of 1938, dated 4-5-1988 contained in Annexure Nos. 3 and 4 to the writ petition orders of termination of services of petitioners of Writ Petition No. 2387 of 1988, dated 4-5-1988 contained in Annexure Nos. 4 and 5 to the writ petition; orders of termination of services petitioners of Writ Petition No. 2554 of 1988, dated 4-5-1988 contained in Annexure Nos. 4 and 5 to the writ petition and orders of termination of services of the petitioners of Writ Petition No. 3145 of 1988, dated 11-5-1988 contained in Annexure Nos. A-7 and A-8 to the petition are hereby quashed. The opposite parties will consider the case of the petitioners to all these writ petitions along with those who were appointed along with them or subsequent to their appointments, that is, those whose services have not been terminated and some of whom have been regularised or directly appointed on regular basis in the same manner as the petitioners to these writ petitions were appointed and only thereafter if it is considered necessary and the petitioners are found to be juniors, their services will be terminated, in accordance with law.

15. There will be no order as to costs.

16. Petition Allowed.