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PETITIONER: C.MUNIYAPPA NAIDU ETC.

       Vs.

RESPONDENT: STATE OF KARNATAKA AND ORS.

DATE OF JUDGMENT13/10/1976

BENCH: BHAGWATI, P.N. BENCH: BHAGWATI, P.N. KRISHNAIYER, V.R. FAZALALI, SYED MURTAZA

CITATION:  1976 AIR 2377            1977 SCR  (1) 791  1976 SCC  (4) 543

ACT:             City   of  Bangalore  Municipal   Corporation   Services         (General)   Cadre  and Recruitment Regulations,  1971,  Reg.         3--Absorption  of  Senior Health inspectors  by  Corporation         contrary to provision in Reg. 3--Effect of.

HEADNOTE:         The   City  of  Bangalore  Municipal  Corporation   Services         (General)  Cadre and Recruitment Regulations,  1971,  framed         under  the  City  of  Bangalore Municipal  Corporation  Act,         1949, came into force on 3rd March,1971. In accordance  with         the’  practice  of the Corporation prevailing   before  that         date to have one half of the cadre of Senior Health  Inspec-         tors  manned  by deputation of Senior Health Inspectors from         the Karnataka State Civil Service, the appellants were taken         on  deputation by the Corporation from the  Karnataka  State         Civil Service.  In 1974, the Corporation passed a resolution         that the appellants would be absorbed by the Corporation  if         they were willing to accept their ranking as juniors to  the         Senior  Health Inspectors of the Corporation, and the  State         Government  accorded its sanction to the resolution  of  the         Corporation as required by the Act.  But coming to know that         the  chances of promotion of the permanent officials of  the         Corporation would be prejudicially affected by such  absorp-         tion,  the State Government withdrew its  sanction  accorded         earlier.   The  appellants  preferred  writ  petitions   for         quashing  the withdrawn  but the High  Court dismissed   the         petitions.             In  appeal  to  this Court, it was  contended  that  the         appellants became permanent employees of the Corporation and         ceased  to be Government servants as soon as the State  Gov-         ernment accorded sanction to the Resolution of the  Corpora-         tion  and  that therefore, the State Government  could  not,         thereafter,  by its unilateral action, reverse  the  process         and  annihilate  the relationship of employer  and  employee         between  the  Corporation and the.  appellants  and  restore         their status as Government servants.         Dismissing the appeals,             HELD   :  (1) The Resolution read  with  the  Government         sanction did  not operate to put an end to the status of the         appellants  as  government servant and to create  the  rela-

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       tionship  of master and servant between the Corporation  and         the appellants, and therefore, it was competent to the State         Government  to withdraw the sanction accorded  earlier;  and         this  would  be so irrespective of  whether  the  appellants         expressed their willingness to be absorbed as SeniOr  Health         Inspectors by the Corporation or not. [797 BC]             (a) Regulation 3 of the Regulations which were in  force         when the Resolution was passed by the Corporation recognised         only  two modes of recruitment to the post of Senior  Health         Inspectors  namely,  by promotion from the cadre  of  Junior         Health  Inspectors and by deputation.  Therefore, to  absorb         Senior  Health  Inspectors  from the  State  Directorate  of         Health  Services as  permanent employees of the  Corporation         would  be  plainly contrary to the express mandate  of  this         statutory provision. [796 C & F]             (b) It could not be urged that because they were already         on deputation in the cadre of Senior Health Inspectors under         the Corporation, their absorption as permanent Senior Health         Inspectors did not constitute fresh entry into the cadre  so         as to require compliance with the Regulations.  Not only         792         their  entry  but  also their continuance in  the  cadre  of         Senior  Health Inspectors on the  Corporation  establishment         depended  on their being on deputation, because, it is  only         by way of deputation that Senior Health Inspectors from  the         State Directorate of Health Services can  find place in  the         cadre  of Senior Health Inspectors on the  establishment  of         the  Corporation  Since absorption is  appointment,  without         amendment  of  the Regulations   permitting  appointment  of         Senior Health Inspectors drawn from  the  State  Directorate         of  Health  Services as permanent Senior  Health  Inspectors         under the Corporation, the appellants could not be  absorbed         on the Corporation Establishment. [796 G-H]

JUDGMENT:         CIVIL APPELLATE JURISDICTION: Civil Appeal No. 761 of 1976.             (Appeal  by  Special Leave from the Judgment  and  Order         dated  28-5-1976 of the Karnataka High Court in Writ  Appeal         No. 665/75 ).         CIVIL APPEAL No’s. 845-854 of 1976.             (Appeals  by Special Leave from the Judgment  and  Order         dated  28-6-1976 of the Karnataka High Court in Writ  Appeal         Nos. 247, 237, 241,243-246, 248 and 250/76 respectively.)              S.V.  Gupte, S.B. Wad, A.K. Ganguli and Mrs.  Jayashree         wad, for the Appellants in all the Appeals.             M.P. Chandrakantraj Urs and B.R.G.K. Achar, for Respond-         ents 1 to 3 in CA 761/76.         Narayan Nettar, for Respondent 4 in CA. No. 761/76.             A.K.  Sen, M.P. Chandrakantraj Urs and  Narayan  Nettar,         for the respondents in CA. No. 845/76.              M.P.  Chandrakantaraj Urs and Narayan Nettar,  for  Re-         spondents 1-3 in CAs 846-849/76.         B.R.G.K. Achar for Respondent 1 in CAs. 850-854/76.             M.P.  Chandrakantaraj  Urs and Narayan Nettar,  for  Re-         spondents 1-3 in CAs. 850-854/76.         Narayan Nettar for Respondent 7 in CAs. 845-846/76.         The Judgment of the Court was delivered by             BHAGWATI,  J.--This  group of appeals  raises  a  common         question  of  law  affecting  Senior  Health  Inspectors  on         deputation   with  the Municipal Corporation of the City  of         Bangalore (hereinafter referred to as the Corporation).  The         facts  giving rise to the appeals are identical and  may  be         briefly stated as follows.

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        The  appellants  are  Senior  Health  Inspectors   in   the         Karnataka  State Civil Service.  It seems that prior to  3rd         March, 1971, when the City of Bangalore  Municipal  Corpora-         tion  Services (General) Cadre and Recruitment  Regulations,         1971  (hereinafter referred to as the Cadre and  Recruitment         Regulations) came into force, the practice         793         of  the  Corporation was to have one half of  the  cadre  of         Senior  Health  inspectors manned by  deputation  of  Senior         Health Inspectors from the Karnataka State Civil Service and         in accordance with this practice, the appellants were  taken         on  deputation by the Corporation from the  Karnataka  State         Civil Service.  While the appellants were working as  Senior         Health  Inspectors on deputation, the  Corporation passed  a         resolution  dated 30th December, 1974- approving the  report         of  the Commissioner that sixteen Senior Health  Inspectors,         including the appellants, who were working under the  Corpo-         ration on  deputation should "be absorbed in the interest of         work if they are :willing on then’ own pay and accept  their         seniority as Juniors to the Senior Health Inspectors of  the         Corporation."  It is the case of the appellants that on  the         same day, immediately :after the passing of this Resolution,         they addressed a communication to the Mayor of the  Corpora-         tion  intimating     to  him that they were  willing  to  be         absorbed  as Senior Health Inspectors under the  Corporation         on their own pay and with ranking below   the Senior  Health         Inspectors of the Corporation.  The factum of this  communi-         cation  was  disputed by the Corporation as well as  by  the         State Government, but in the view we are taking, it will not         be necessary for us to examine this question.  To.  continue         further  with the narration of facts, the  Corporation  sent         the  Resolution dated 30th December, 1974 to the State  Gov-         ernment for according its  sanction and the State Government         by  an order dated 6th May, 1975 accorded sanction  "to  the         Corporation’s resolution dated 30th December, 1974 regarding         the  absorption of the Senior Health  Inspectors"  mentioned         the  Resolution  under section 89 of the City  of  Bangalore         Municipal Corporation Act, 1949 (hereinafter referred  to as         the Act).  The term of the Corporation in the meantime  came         to  an end and since fresh elections were not held to  elect         the  members  of the Corporation, an administrator  was  ap-         pointed’  by  the Government to manage the  affairs  of  the         Corporation.   The  administrator   requested   the    State         Government to defer implementation of the proposal contained         in the Resolution dated 30th December, 1974 since the perma-         nent  officials  of the Corporation were  considerably  dis-         turbed  by this proposal as it prejudicially affected  their         chances of promotion by reason of the absorption of  sixteen         deputationist  Senior Health Inspectors from  the  Karnataka         State  Civil Service.  The State Government on the basis  of         the  communication  addressed by the Administrator  in  this         behalf  passed another order dated 25th August,  1976  with-         drawing the sanction accorded under the earlier order  dated         6th  May, 1975. The appellants being prejudicially  affected         by the withdrawal of the sanction. preferred writ  petitions         in the High Court of Karnataka contending that    as soon as         the  State Government gave its sanction on 6th May, 1975  to         the Resolution of the Corporation dated 30th December, 1974,         they were absorbed as permanent employees of the Corporation         and  they  ceased to be Government servants  and  the  State         Government  thereafter  had  no authority  to  withdraw  the         sanction  granted  by it under the earlier order  dated  6th         May,  1975 and the subsequent order dated 25th  August  1975         was  invalid and inoperative. These writ petitions  came  up         for  hearing  before a Single Judge of the  High  Court  who

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       rejected them by a judgment dated 22nd September, 1975.  The         appellants  thereupon preferred appeals under section  4  of         the Karnataka High Court Act.         794         1961,  but  the  appeals ’were unsuccessful  and  they  were         rejected by a Division Bench of the High Court by a judgment         dated   28th  May, 1976.  Hence the present appeals  by  the         appellants with special leave obtained from this Court.             The  principal question which arises  for  determination         in   these appeals is whether the appellants who are  Senior         Health  Inspectors mentioned in the Resolution of the Corpo-         ration dated 30th December, 1974 became permanent  employees         of  the Corporation and ceased to be Government servants  as         soon as the State Government passed the order dated 6th May,         1975 according its sanction to the Resolution of the  Corpo-         ration.  There can be no doubt that if the  effect  of   the         Government order dated 6th May, 1975 was to snap the  status         of the appellants as Government servants and to absorb  them         as permanent employees of the Corporation, the State Govern-         ment  could not thereafter by its unilateral action  reverse         the process and annihilate the relationship of employer  and         employee  between  the Corporation and  the  appellants  and         restore their status as Government servants.  The main issue         which,  therefore,  falls for determination is  as  to  what         legal effect flowed from the Government order dated 6th May,         1975: did it have the effect of absorbing the appellants  as         permanent  employees  of the Corporation  with  simultaneous         termination of their employment as Government servants ?  To         answer this issue it is necessary to refer to a few relevant         provisions of the Act and the Cadre and Recruitment  Regula-         tions.             The  provisions  in regard to the establishment  of  the         Corporation are-to be found in sections 84 to 95 of the Act.         Section 84 provides for appointment of a Health Officer,  an         Engineer,  a Revenue Officer and other heads of  departments         working  under the Commissioner while section 85 deals  with         special  superior appointments.  We are not  concerned  with         either of these two sections since Senior Health  Inspectors         do not fall within the categories of officers dealt with  in         these two sections.  Section 86 provides that if a.  vacancy         occurs  in  any office specified in sections 84 and 85 or in         any  office  under  the   Corporation  the  maximum  monthly         salary  of which exceeds two hundred and fifty  rupees,  the         Corporation  shall, subject to the confirmation of the  Gov-         ernment, within two months of the date of occurrence of  the         vacancy,  appoint a duly qualified person to hold  such  of-         fice.   The office of Senior Health Inspector is undoubtedly         an  office the maximum monthly salary of which  exceeds  two         hundred  and fifty rupees and therefore, a vacancy  in  that         office is liable to be filled by the Corporation, subject to         confirmation by the Government, under this section. Sections         87  and 88 are not material for our purpose and we need  not         pause  to consider them.  Section 89 says that,  subject  to         the  provisions of sections 84, 85, 86 and 88,  appointments         to the Corporation establishment shall be made by the Corpo-         ration  if the maximum monthly salary of the office  exceeds         two  hundred  and fifty rupees.  It is clear on  a  conjoint         reading  of  sections 86 and 89 that it is  the  Corporation         which  is  entitled  to make appointment to  the  office  of         Senior  Health Inspector and such appointment is subject  to         confirmation  by   the Government.   Then comes  section  90         which provides that the Commissioner shall from time to time         lay before the Standing Committee         795         a  Schedule  setting forth the designations  and  grades  of

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       officers   and servants who should in his opinion constitute         the Corporation establishment and embodying his proposals in         regard to salaries, fees  and allowances payable to them and         the  Standing Committee may   either approve or  amend  such         Schedule as it thinks fit and shall lay it before the Corpo-         ration and the Corporation shall then sanction such Schedule         with or without modifications and may also from time to time         amend it at the instance of the Commissioner and the  Stand-         ing Committee. There is a proviso to this section which says         that no new office shall be created without the sanction  of         the Government, if the   maximum monthly salary exceeds  two         hundred  and  fifty rupees.  This proviso, however,  has  no         application  in the present case, since the  Schedule  sanc-         tioned  by  the  Corporation set out the  office  of  Senior         Health  Inspector  and the absorption of the  appellants  as         Senior  Health Inspectors on the  Corporation  establishment         did not involve the creation of any new office which was not         already enumerated in the Schedule. Section 91 provides that         no officer or servant shah be entertained on the Corporation         establishment unless he has been appointed under section 84,         85,  86 or 88 or unless his emoluments are included  in  the         Schedule sanctioned under section 90.  But this section also         does  not stand in the way of the absorption of  the  appel-         lants as Senior Health Inspectors on the Corporation  estab-         lishment,  since  they are purported to be absorbed  by  the         Corporation by  its  resolution dated   30th December,  1974         and  the Government Order dated 6th May, 1975 is  tantamount         to  confirmation of such absorption and hence section 86  is         complied with and the office and emoluments of Senior Health         Inspector are also included in the Schedule sanctioned under         section  90. The other sections dealing with the  establish-         ment of the Corporation   are not material except section 94         which  confers  power on the  Standing  Committee  to  frame         regulations  in respect of the Corporation establishment  in         regard  to various matters.   It will, therefore,  be   seen         that  there is nothing in the Act which debarred  absorption         of the appellants as permanent employees of the  Corporation         under  the Corporation Resolution dated 30th December,  1974         read with the Government Order dated 6th May, 1975.              But the argument of the State Government and the Corpo-         ration was, and this argument found favour with the Division         Bench  of the High Court, that until the Cadre and  Recruit-         ment  Regulations were amended, it was not competent to  the         Corporation  to  absorb  the appellants as permanent  Senior         Health  Inspectors on the establishment of  the  Corporation         and the Resolution of the Corporation dated  30th  December,         1974, though sanctioned by the Government by its order dated         6th  May, 1975, was not effective to bring about  absorption         of the appellants as permanent employees of the  Corporation         with simultaneous termination of their service as Government         servants.   This argument requires consideration of some  of         the relevant provisions of the Cadre and Recruitment Regula-         tions.   The Cadre and Recruitment Regulations  were  framed         under sections 7, 84, 85, 88 and 94 of the Act and they were         sanctioned  by the State Government under section  94(g)  of         the Act and they came into force with effect from 3rd March,         1971  being  the date on which they were  published  in  the         Government         19--1234SCI/76         796         Gazette.  Regulation 3 laid down the method of   recruitment         and minimum qualifications for recruitment to various  posts         enumerated in the Schedule.  One of the posts enumerated  in         the Schedule was the post of Senior Health Inspector and  it         was provided in Column 2  of the Schedule that the method of

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       recruitment to the post of Senior Health Inspector shall be:               "50%  by  promotion from the Cadre  of  Junior  Health         Inspectors of the Corporation,               50% by deputation from the State Directorate of Health         Services."             The  Cadre and Recruitment Regulations  thus  recognised         only  two modes of recruitment to the post of Senior  Health         Inspector, namely, promotion from the cadre of Junior Health         Inspectors  and  deputation from the State  Directorate   of         Health Services and one half  of  the cadre was to be  drawn         from each of these two sources. No other mode of recruitment         could  be resorted to by the Corporation  under   the  Cadre         and Recruitment Regulations.   it is difficult to see how in         the  face of this provision which has  admittedly  statutory         effect, the posts of Senior Health inspector could be filled         in  by absorption of deputationist Senior Health  Inspectors         from  the Karnataka State Civil Service. Senior  Health  In-         spectors from the State Directorate of Health Services could         only  be  on  deputation to the extent of one  half  of  the         number of posts of Senior Health Inspectors on the  Corpora-         tion establishment and they could not be absorbed as  perma-         nent Senior Health Inspectors under the Corporation  without         violating the aforesaid statutory  provision.   This  statu-         tory  provision  does  not contemplate  any   Senior  Health         Inspectors on the establishment of the  Corporation who  are         drawn  from the State Directorate of Health Services  other-         wise than on deputation and to absorb Senior Health  Inspec-         tors from the State Directorate of Health Services as perma-         nent employees of the Corporation (otherwise than on deputa-         tion),  would be plainly contrary  to its  express  mandate.         It was, however, contended on behalf of the appellants  that         when  they were absorbed as permanent Senior Health  Inspec-         tors  on  the establishment of the  Corporation,  they  were         already  in the cadre of Senior Health Inspectors under  the         Corporation,  filling 50% of the posts and their  absorption         as  permanent  Senior Health Inspectors did  not  constitute         fresh entry into the cadre so as to require compliance  with         the Cadre and Recruitment Regulations. The position, accord-         ing  to the appellants, was similar to that of  an  employee         Who  is  initially OffiCiating in a pOSt in a cadre  and  is         subsequently confirmed in the post.  This contention, we  do         not think, is well founded.  It is only by way of deputation         that Senior Health Inspectors from the State Directorate  of         Health  Services  can  find place in the  Cadre  of   Senior         Health  Inspectors on the establishment of the  Corporation.         Not only their entry but also their continuance in the cadre         of Senior Health Inspectors on the Corporation establishment         depends  on their being on deputation.   There is  no  scope         under  the Cadre and Recruitment Regulations for  their  ab-         sorption  as  permanent Senior Health Inspectors  under  the         Corporation.   In fact, it is impermissible to do  so.   The         category  of Senior Health Inspectors, who are  regular  em-         ployees  of the Corporation, can be drawn only by  promotion         from Junior Health         797         Inspectors and that too, to the extent of only one half  the         number  of  posts.  It is, therefore, obvious  that  without         amendment  of the Cadre and Recruitment Regulations  permit-         ting  appointment--and absorption    is really  nothing  but         appointment--of  Senior  Health Inspectors  drawn  from  the         State  Directorate of Health Services as  permanent   Senior         Health  Inspectors  under the  Corporation,  the  appellants         could not be absorbed as permanent Senior Health  Inspectors         on  the  Corporation  establishment.   The  conclusion  must         irresistibly  follow that the Resolution of the  Corporation

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       dated  30th  December, 1974 read with the  Government  order         dated  6th  May, 1975 did not operate to put an end  to  the         status  of the appellants as Government  servants   and   to         create  the relationship of master and servant  between  the         Corporation and the appellants and in the circumstances,  it         was  competent  to the State Government to  pass  the  Order         dated 25th August, 1975 withdrawing the sanction granted  by         it  under the earlier Order dated 6th May, 1975.  This  view         taken  by us renders it unnecessary to consider whether  the         communication dated 30th December, 1974 was addressed by the         appellants to the Mayor of the Corporation expressing  their         willingness to be absorbed as Senior Health Inspectors under         the Corporation on the terms set out in the Resolution dated         30th  December,  1974.  Even if any such  communication  was         sent,  it  could have no legal effect  because,  as  already         pointed  out by us. the appellants could not be absorbed  as         permanent Senior Health  Inspectors  under  the Corporation,         unless and until the Cadre and Recruitment Regulations  were         first amended so as to permit such absorption.             The appeals are accordingly dismissed, but in the pecul-         iar facts and circumstances of the ease, we make no order as         to costs.         V.P.S.                                               Appeals         dismissed..         798