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PETITIONER: JACOB M. PUTHUPARAMBIL AND ORS. ETC. ETC.

       Vs.

RESPONDENT: KERALA WATER AUTHORITY AND ORS. ETC. ETC.

DATE OF JUDGMENT19/09/1990

BENCH: AHMADI, A.M. (J) BENCH: AHMADI, A.M. (J) REDDY, K. JAYACHANDRA (J)

CITATION:  1990 AIR 2228            1990 SCR  Supl. (1) 562  1991 SCC  (1)  28        JT 1990 (4)    27  1990 SCALE  (2)588  CITATOR INFO :  D          1992 SC2070  (15,20,22)  RF         1992 SC2130  (10,11)

ACT:     Kerala Water Supply and Sewerage Act, 1986/Kerala  State Subordinate   Service  Rules,    1958--Section    19(1)/Rule 9(a)(i)--Kerala Water Authority-- Transfer of employees  and regularisation of service.

HEADNOTE:     Consequent  upon the establishment of Kerala  Water  Au- thority  under  the Kerala Water Supply  and  Sewerage  Act, 1986,  all the functions which were till then carried on  by the Public Health Engineering Department (PHED) were  trans- ferred  to the said Authority. Contemporaneously  with  that every person working in the PHED became the employee of  the Kerala  Water  Authority by virtue of Section 19(1)  of  the Act.  Though the said Act was given retrospective  operation w.e.f.  1st March 1984, Section 69 thereof came  into  force from  the  date of publication of the Act  in  the  Gazettee viz.,  4.8.1986; actual effect could be given  w.e.f.  30.7. 1988  on  which date the necessary notification  was  issued where by the rule was amended and the Authority came  within the  purview  of  the Public Service  Commission.  Thus  the employees  of the Authority fell into four different  groups viz.,  (i) those who were in the employment of  PHED  before the  constitution of the Authority and were  transferred  to the  Authority, (ii) those whom the Authority  employed  be- tween  1st April, 1984 and 4th August 1986, (iii) those  who were  appointed between 4th August 1986 and 30th July  1988, and (iv) those who were appointed after 30th July 1988.  The Authority  it seems terminated the services of  various  em- ployees.     The petitioners apprehending termination of their  serv- ices by the Authority filed petitions contending inter  alia that they were recruited through the Employment Exchange and till  the  issuance  of the  notification  dated  30.7.1988, amending  the concerned PSC rule, there was no  question  of the Authority consulting the PSC and therefore, appointments made prior to that date could not be termed as irregular  or unauthorised and could not be determined on that ground.  It

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is  asserted  by them that the High Court refused  to  grant relief to those employees whose services were threatened and despite favourable orders passed by this Court in cases that came  before  it, the Authority continued to  terminate  the services of employees similarly placed treating those 563 orders  as having been passed in respect of only  those  em- ployees  who were before the Court. It is, therefore,  urged by  them  that  this Court should pass  orders  laying  down guidelines  for  the regularisation of the services  of  not only the petitioners but also all others similarly placed so that  the low income employees are not required to knock  at the  doors  of different courts for protection  against  the threatened  arbitrary  action of the  Authority  terminating their services. The Authority has contested the cases on the plea that all the appointments made before or after April 1, 1984 were governed by Rule 9(a)(i) of the Rules till Section 69 came into force w.e.f. 4.8.1986 and 30.7.1988 when it was amended.  Appointments made after 4.8.1986 are clearly  sub- ject  to  the requirement of Section 69 of the Act  and  the Authority  cannot act in contravention thereof. Services  of all those who were governed by Rule 9(a)(i) will have to  be determinated on the expiry of 180 days. Allowing the appeals as also writ petitions, this Court,     HELD:  Interpreting Rule 9(a)(i) consistently  with  the spirit  and  philosophy  of the Constitution,  which  it  is permissible  to do without doing violence to the said  rule, it follows that employees who are serving on the  establish- ment  for long spells and have the requisite  qualifications for  the  job, should not be thrown out but  their  services should  be  regularised as far as  possible.  Since  workers belonging  to  this  batch have worked on  their  posts  for reasonably  long spells they are entitled to  regularisation in service. [388A-B]     P.K. Narayani & Ors. v. State of Kerala and Ors., [1984] Suppl.  SCC 212; Dr. A.K. Jain & Ors. v. Union of India  and Ors.,  [1987]  Suppl.  SCC 497;  Daily-rated  Casual  Labour employed  under  P & T Department through Bhartiya  Dak  Tar Mazdoor Manch v. Union of India and Ors., [1988] 1 SCC  122, referred to.

JUDGMENT:     ORIGINAL JURISDICTION: Writ Petition (Civil) No. 112  of 1990 etc. etc. (Under Article 32 of the Constitution of India.)     P.S. Poti. E.M.S. Anam, V.J. Francis and M.N. PopIi  for the Petitioners.     T.S. Krishnamurthy Iyer, G. Viswanatha Iyer, A.S. Nambi- ar.  K.R. Kurup. S. Balakrishanan, Vijay Kumar,  T.T.  Kunhi Kannan. Smt. S. Vasudevan and P.K. Manohar for the  Respond- ents. 564 The Judgment of the Court was delivered by AHMADI, J. In special leave petitions, leave granted.     An  autonomous  body called the Kerala Water  and  Waste Water Authority was constituted with effect from 1st  April, 1984 under Section 3(1) of the Kerala Water and Waste  Water Ordinance, 1984 (No, 14 of 1984) which Ordinance was brought into  force w.e.f. 1st March, 1984. This ordinance  was  re- placed  by similar Ordinances issued from time to time,  the last  being Ordinance No. 27 of 1986 which was in  turn  re- placed  by  the Kerala Water Supply and Sewerage  Act,  1986 (Act  No. 14 of 1986), (hereinafter called ’the Act’);  Sec-

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tion  1(3) whereof provides that it shall be deemed to  have come  into force on 1st March, 1984. This Act, besides  pro- viding  for the establishment of an autonomous authority  to be  called the Kerala Water Authority, makes  provision  for the  development  and regulation of water supply  and  waste water  collection  and disposal and  for  matters  connected therewith. There is no dispute that the functions which were carried  on  by  the Public  Health  Engineering  Department (PHED) were transferred to the autonomous body on the enact- ment of the Ordinance No. 14 of 1984. After the enactment of the Act, every person working in the PHED became the employ- ee of the Kerala Water Authority (for short ’the Authority’) by virtue of Section 19(1) of the Act, which reads as under: "Transfer  of employees to the Authority--Save as  otherwise provided  in this section, every person who was employed  in the  Public Health Engineering Department of the  Government shall,  on and from the appointed day become an employee  of the  Authority and shall hold his office or service  therein by  the same tenure, at the same remuneration and  upon  the same  terms  and conditions, and with the  same  rights  and privileges  as to pension, gratuity and other matters as  he would  have held the same on the appointed day if  this  Act had  not come into force and shall continue to do  so  until his  employment in the Authority is terminated or until  his remuneration  or other terms and conditions of  service  are revised or altered by the Authority under or in pursuance of any  law or in accordance with any provision which  for  the time being governs his service: Provided  that nothing contained in this  sub-section  shall apply to an employee in the cadres of the Administrative ? 565 Officers, Financial Assistants Divisional Accounts,  Typists and  Stenographers, who, by notice in writing given  to  the Government and the Authority within such time as the Govern- ment  may, by general or special order,  specify,  intimates his intention of not becoming an employee of the Authority: Provided further than an employee referred to in the preced- ing  proviso  shall  continue to be an  employee  under  the Government  and shall be provided elsewhere in any  post  or other service under the Government." Sub-sections  (3) and (6) of Section 19 make it  clear  that such  transfer of service shall not entitle the employee  to claim  any compensation under the Industrial  Disputes  Act, 1947  nor  shall it amount to retrenchment or  abolition  of post  under any extant rule, regulation or order  applicable to  Government  servants. Thus, the erstwhile staff  of  the PHED  was by the thrust of Section 19(1) transferred on  the establishment of the Authority. This would naturally concern those  persons only who were in the employment of  the  PHED before the establishment of the Authority w.e.f. 1st  April, 1984.     The  staff members employed by the Authority  after  its constitution  were naturally appointed under the  provisions of  the concerned statute. Since the Act  has  retrospective effect,  reference  may be made to Section 8(1) of  the  Act which reads thus: "Appointment  of officers and staff--Subject to  the  provi- sions of sub-section (2), the Authority may appoint for  the purpose  of enabling it to carry out its powers, duties  and functions  under this Act, a Secretary and such other  offi- cers  and staff as may be required against posts duly  sanc- tioned by it: Provided  that the-Authority shall obtain the  previous  ap- proval of the Government for the creation of post above  the

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rank of the Executive Engineer." By  virtue of Section 8(3), except as provided  by  sub-sec- tions  (1) & (2), the appointment and conditions of  service of  the  officers and employees of the Authority are  to  be governed by rules made by the Government from time to  time. Although  the Act is deemed to have come into  force  w.e.f. 1st March. 1984, Section 69 became effective 566 from the date of publication of the Act in the Gazette  i.e. 4th August, 1986. That section reads as follows: "Amendment  of Act 19 of 1970--With effect from the date  of publication  of this Act in the Gazette, the  Kerala  Public Service Commission (Additional functions as respects certain Corporations  and  Companies) Act, 1970 (19 of  1970)  shall have effect subject to the following amendment, namely:-- in  clause (a) of Section 2, the words and figures  "or  the Kerala  Water Authority" established under section 3 of  the Kerala Water Supply and Sewerage Act 1986;", shall be  added at the end." Even though Act 19 of 1970 stood so amended by the force  of Section  69, actual effect could be given after issuance  of Notification  No.  G.O. (MS) No. 38/88/P &  ARD  dated  30th July, 1988 on which date item (LIII) was added to the  rele- vant rules as "Amendment  of the Rules--In the Kerala Public Service  Com- mission  (consultation by Corporation and Companies)  Rules, 1971, in Clause (d) of rule 2, after item (LII), the follow- ing item shall be added, namely:-- (LIII)--The Kerala Water Authority." This  amendment  was  considered necessary with  a  view  to bringing the Authority within the purview of PSC so that  it may seek the advice of that body on matters relating to  the methods of recruitment of its employees, etc.     From  the  above discussion it becomes  clear  that  the employees of the Authority can be divided into four distinct groups,  viz., (i) those who were in the employment of  PHED before  the  constitution of the Authority and  were  trans- ferred  to the Authority (ii) those whom the  Authority  em- ployed  between 1st April. 1984 and 4th August,  1986  (iii) those  who were appointed between 4th August, 1986 and  30th July,  1988  and (iv) those who were  appointed  after  30th July, 1988.     The petitioners in this batch of matters are serving  in different  capacities,  such as, cleaners,  pump  operators, draftsmen, drivers, etc. They claim that they were appointed through the Employment Ex- 567 change  between 1981 and 1988. They contend that  they  have been compelled to approach this Court as their services  are likely  to be terminated as has been done in the case  of  a few of their colleagues. They contend that till the issuance of  the  notification  dated 30th July.  1988  amending  the concerned PSC rule (amendment  extracted earlier) there  was no  question of the Authority consulting the PSC and  there- fore, appointments made prior to that date cannot be  termed as  irregular  or unauthorised and cannot be  determined  on that  ground. They contend that as in a few cases  the  High Court  of Kerala failed to appreciate this true legal  posi- tion and refused to grant relief to employees whose services were  threatened,  the Managing Director  of  the  Authority issued  instructions  to his subordinates to  terminate  the services  of similarly placed employees, thereby  compelling the  present petitioners to approach this Court so that  all such employees are uniformly governed by this Court’s order. They point out that in Civil Appeals Nos. 472 to 478 of 1988

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arising  from  the High Court decision. and  Writ  Petitions (Civil)  Nos.  857 and 1135 of 1987, this Court  passed  the following order on 1st February, 1988: "Special leave granted. Heard counsel for the parties. We  are of the view that in the facts and  circumstances  of these  cases the services of such of the appellants as  pos- sess  the  requisite qualifications should be  regulated  in accordance with the Kerala Public Service Commission  (Addi- tional functions as respects certain Corporations and Compa- nies)  Act, 1970 and until such regularisation is  made,  no appointment on similar posts from outside be made. If  there be  any excess employees now in service employment, it  will be  open  to the Authority to terminate  their  services  on condition that as and when vacancies arise, they shall first be considered for appointment keeping the direction indicat- ed above in view. Recruitments in future will, however, be in accordance  with the  Kerala Public Service Commission (Additional  functions as  respects certain Corporations and Companies)  Act,  1970 and the Kerala Water Supply and Sewerage Act, 1986." Thereafter in another batch of special leave petitions  Nos. 4385  to 4387 of 1988 this Court passed the following  order on 24th March, 1988: 568 "Heard learned counsel for parties. The only direction which we can give in the facts and circumstances of the case  will be in case after all those who have been regularly  selected by the Public Service Commission are appointed and  thereaf- ter  any  vacancies are left, the same should  be  given  to those who, like the petitioners, have already been in  serv- ice  taking into consideration their seniority.  Every  step should  be taken by the Water Authorities to regularise  the services  of  such  people who can be  appointed  under  our direction  as  indicated  above. There will  be  no  further direction  in this case. The other person who may be  thrown out  of employment on account of the direction of the  Water Authority which is impugned before us, may appear before the Public Service Commission in the next examination, The State of Kerala has informed us that age bar would be waived.  The petitions are disposed of accordingly." The Authority treated these orders as confined to the  work- men  who  had filed the proceedings and did not  extend  the ratio to others similarly placed. Not only that, the Author- ity,  contend the petitioners, placed different  interpreta- tions on the aforesaid orders and continued to terminate the services  of the employees. Another group of writ  petitions Nos. 525,527,528, and 503 of 1988 came up before this  Court on 28th November, 1988 when this Court passed the  following Order: "Mr.  Krishna  Murthy Iyer appearing for  the  Kerala  Water Authority  states that the claims of the petitioners can  be divided into three categories, namely (1) those who had been employed by Public Health Engineering Department before  the Kerala  Water Authority was constituted, (2) those  who  get employed  between  1.4.1984  and 1986 and  (3)  the  persons appointed  after 1986. The Kerala Water Authority  is  given three months’ time to examine the individual cases of  these groups  and  take its decision accordingly.  We  direct  the Authority  to place its conclusions before the Court  before giving effect to them. Status quo as on today will  continue until further orders." The grievance of the petitioners is that no action was taken by  the Authority within the time allowed nor has  it  taken any  action  till  today to implement the  said  order.  The petitioners also contend that the employees are compelled to

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knock  at  the doors of different courts  as  the  Authority continues to terminate the services of the employees 569 not  with  standing the aforequoted orders  passed  by  this Court. Mr. P.S. Poti, the learned counsel for the  petition- ers, therefore, made a fervent appeal that this Court should pass an order laying down guidelines for the  regularisation of  the  services of not only the petitioners but  also  all others  similarly  placed  so that these  low  income  group employees are not required to knock at the doors of  differ- ent  courts to protect themselves from the threatened  arbi- trary action of the Authority terminating their services. In other  words he wants this Court to formulate a  scheme  for the  regularisation of the services of all similarly  placed employees  which would put an end to all pending  cases  and future  cases  which  are bound to arise  if  the  Authority continues its present policy.     The claims made by the employees in this group of  cases is contested mainly on the plea that their tenure and  serv- ice conditions were regulated by Rule 9(a)(i) of the  Kerala State  and  Subordinate  Service  Rules,  1958  (hereinafter called  ‘the Rules’) which were statutory in  character  and were,  therefore,  binding on the Authority as well  as  the employees.  It is contended that the employees belonging  to different  categories were appointed on different  dates  by the  PHED  prior  to 1st April, 1984 under  this  rule  and, therefore,  their services could only be regulated  thereun- der.  After the autonomous Authority was constituted  w.e.f. 1st  April, 1984 on the enactment of Ordinance 14  of  1984, the Authority passed a Resolution No. 8 on 25th April,  1984 adopting the aforesaid Rules and hence all appointments made after 1st April, 1984 also came to governed by Rule  9(a)(i) of  the  Rules till Section 69 of the Act  came  into  force w.e.f.  4th  August, 1986 and not 30th July, 1988  when  the relevant rule was amended by the introduction of item (LIII) referred  to  earlier. Appointments made after  4th  August, 1986 are clearly subject to the requirement of Section 69 of the Act and the Authority cannot act in contravention there- of. Had it not been for Court orders restraining the Author- ity  from  terminating their services, the services  of  all those  who  were governed by Rule 9(a)(i)  would  have  been terminated on the expiry of 180 days. The text of that  rule may be noticed at this stage: "Where  it is necessary in the public interest, owing to  an emergency which has arisen to fill immediately a vacancy  in a  post borne on the cadre of a service, class  or  category and there would be undue delay in making such appointment in accordance  with  these  rules and the  Special  Rules,  the appointing authority may appoint a person, otherwise than in accordance with the said rules, temporarily." 570 The first proviso is not relevant for our purpose but  reli- ance was placed on the second proviso which reads as under: "Provided further that a person appointed under this  clause by direct recruitment to a post other than teaching post and a post covered by the proviso to clause (iii) of rule 10(b)] shall  not be allowed to continue in such post for a  period exceeding three months." (i.e. one hundred eighty days) The  rule  further requires that a  person  appointed  under clause  (i)  should  be replaced as soon as  possible  by  a member of the service or an approved candidate qualified  to hold  the post under the said rules. Such  replacement  must take  place  in the order of seniority based  on  length  of temporary service in the unit. It is, therefore, the case of

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the  Authority that appointments made under this  rule  were purely temporary, not to exceed three months, and had to  be terminated  on the expiry of the said period and it was  not open  to  the Authority to continue their services  even  by reappointment unless fresh candidates were not available for reappointment through employment exchange. Therefore, had it not  been  for  the restraint  orders  issued  by  different Courts, the Authority contends it was under an obligation to act in conformity with the above rules. However, as  regards those  who  had joined service prior to 1st April.  1984  in different  categories, the Authority passed a resolution  on 30th January, 1987 to the following effect: "Resolved to recommend the Government the regularisation  of the service of the employees recruited in the erstwhile PHED and still working in the Kerala Water Authority." The Government, it seems, has not taken any decision in this behalf  as  yet. Since the counter filed on  behalf  of  the State Government is silent on this point we inquired of  the learned  counsel for the State to clarify the  position.  We were told that since the Authority was an autonomous body it was free to regularise the services of such employees, if it so desired, without the concurrence of the State Government. While  admitting the fact that appointments were  made  from the lists submitted by various District Employment Officers, the  Authority contends that as the appointments  were  gov- erned  by  Rule 9(a)(i) they could not ensure  beyond  three months and the termination of their employment did not  fall within the ambit of ‘retrenchment’ as understood under the 571 Industrial  Disputes Act, 1947. In any case  even  otherwise the  application  of that law is  specifically  excluded  by Section  19(3) of the Act and hence the benefit of that  law cannot  be extended to the employees of the  Authority.  The contention that the action of the Authority to terminate the services is violative of Article 14 is repelled on the  plea that acting in conformity with a statutory Rule 9(a)(i)  can never  be branded as arbitrary. Lastly it is contended  that the Authority was not directed to apply this Court’s  orders passed in some of the proceedings referred to earlier to all similarly  situated  employees as the  Court’s  orders  were based  on  ‘the fact and circumstances of these  cases’  and were not intended to be of general application. With  refer- ence  to the order of 24th March, 1988 it is said  that  the Authority  has moved a review application which is  pending. The  Authority contends that as there is no infringement  of any  fundamental  right, the writ  petitions  brought  under Article  32  of the Constitution cannot  be  sustained.  The above is the stand taken by the Authority. The State Govern- ment  has by and large supported this stand and,  therefore, we need not restate the contentions raised in their counter. The  respondents, therefore, contend that the employees  are not entitled to any relief whatsoever and the  appeals/peti- tions deserve to be dismissed with costs.     The question of regularisation in service must be  exam- ined keeping in mind the historical as well as the constitu- tional  perspectives.  During the colonial  rule  industrial growth in the country was tardy and most of the  large-sized industries were controlled by British interests. These  establishments  employed Indian labour on  wages  far below  the sustenance levels. Men, women and  even  children were required to work for long hours in thoroughly unhygien- ic conditions. Because of large-scale unemployment there was a  surplus labour market which the employers could  and  did exploit. This virtually forced the labour to accept  employ- ment  on terms unilaterally dictated by the  employers.  The

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relationship  between  the employer and the  employee  being purely  contractual, the hire and fire rule governed.  Those were the days of laissez faire when contractual rights  were placed above human rights. The concepts of dignity of labour and  fair remuneration for work done were wholly alien.  The workers had to work in appalling conditions and at low wages with no job security.     After  we attained independence the pace  of  industrial growth  accelerated. Our Constitution makers were  aware  of the  hardships and insecurity faced by the working  classes. The  Preamble  of our Constitution obligates  the  State  to secure  to  all its citizens social  and  economic  justice, besides political justice. By the 42nd Amendment, the Pream- 572 ble of the Constitution was amended to say that ours will be a  socialistic democracy. In furtherance of  these  promises certain fundamental rights were engrafted in Part 111 of the Constitution. The Constitution guarantees ‘equality’, abhors discrimination, prohibits and penalises forced labour in any form whatsoever and extends protection against  exploitation of  labour  including child labour.  After  extending  these guarantees, amongst others, the Constitution makers proceed- ed to chart out the course for the governance of the country in  Part IV of the Constitution entitled ‘Directive  Princi- ples  of State Policy’. These principles reflect  the  hopes and  aspirations of the people. Although the  provisions  of this  part are not enforceable by any court, the  principles laid down therein are nevertheless fundamental in the gover- nance Of the country and the State is under an obligation to apply them in making laws. The principles laid down therein. therefore,  define the Objectives and goals which the  State must endeavour to achieve over a period of time.  Therefore, whenever  the State is required to make laws     It must  do so consistently with these principles with a view to  secur- ing social and economic freedom so essential for the  estab- lishment  of an egalitarian society. This  part,  therefore, mandates that the State shall strive to promote the  welfare of the people by minimising the  inequalities in income  and eliminating inequalities in status, facilities and  opportu- nities;  by directing its policy towards  securing,  amongst others,  the distribution of the material resources  of  the community  to subserve the common good; by so operating  the economic system as not to result in concentration of wealth; and by making effective provision for securing the right  to work as also to public assistance in cases of  unemployment, albeit  within the limits of its economic capacities.  There are  certain  other  provisions which enjoin  on  the  State certain duties, e.g. securing to all workers work, a  living wage, just and humane conditions of work, a decent  standard of life. participation in management, etc., which are  aimed at improving the lot of the working classes. Thus the Pream- ble promises socio-economic justice, the fundamental  rights confer  certain  justiciable socio-economic rights  and  the Directive Principles fix the socio-economic goals which  the State must strive to attain. These three together constitute the core and conscience of the Constitution.     India  is  a developing country. It has a  vast  surplus labour  market. Large-scale unemployment offers  a  matching opportunity to the employer to exploit the needy. Under such market conditions the employer can dictate... I his terms of employment taking advantage of the absence of the bargaining power in the other. The unorganised job seeker is left  with no option but to accept employment on take-it-or- 573 leave-it  terms offered by the employer. Such terms  of  em-

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ployment  offer no job security and the employee is left  to the  mercy of the employer. Employers have betrayed  an  in- creasing tendency to employ temporary hands even on  regular and permanent jobs with a view to circumventing the  protec- tion  offered  to the working classes under  the  benevolent legislations  enacted  from time to time,  One  such  device adopted is to get the work done through contract labour,  It is  in this backdrop that we must Consider the  request  for regularisation in service.     Before we deal with the case on hand it would be  advan- tageous  to  refer to some of the decision  bearing  on  the question of regularisation. In Smt. P.K. Narayani & Ors.  v. State of Kerala & Ors,, [1984] Suppl. SCC 212 the  petition- ers who had been serving as employees of the State of Kerala or  its  public sector undertakings for the past  few  years challenged  the action of the employer in terminating  their services  to  make room for the candidates selected  by  the Kerala  Public Service Commission. This Court directed  that the  petitioners and all others similarly placed  should  be allowed  to appear at the next examination that  the  Public Service  Commission  may hold without raising the  age  bar; till  then  the petitioners and others may be  continued  in service  provided there are vacancies. This,  clarified  the Court, will not confer any right on the employees to contin- ue in service or of being selected by the Commission  other- wise  than in accordance with the extant rules  and  regula- tions.  These  directions were given to  resolve  what  this Court described as ‘a human problem which has more than  one facet’,  Again in Dr. A.K. Jain & Ors. v, Union of  India  & Ors., [1987] Suppl. SCC 497 the services of ad hoc Assistant Medical Officers who were initially appointed for six months but were continued for periods ranging upto four years, were sought  to be terminated to accommodate the  candidates  se- lected by the Union Public Service Commission. The petition- ers  claimed that their services should be  regularised  and their  seniority  should  be fixed from the  date  of  their initial entry in service as ad hoc appointees. In the  coun- ter, the Union of India contended that ‘ad hoc’ appointments were  made by the General Managers of the Zonal Railways  to tide  over temporary shortages of doctors and their  tenures were  extended till regular selection was made by  the  UPSC and appointments were made by the President of India.  Since the appointing authority was the President of India such  ad hoc appointments by the General Managers of the Zonal  Rail- ways could not be regularised. It was further contended that the  ad hoc appointees were granted age relaxation and  were asked to appear at two special selections based on interview alone held by the 574 UPSC  in  1982 and 1985. The petitioners were those  ad  hoc appointees  who  had either failed to avail of  the  special benefit of selection or had appeared and failed to  qualify. In the circumstances it was contended that they could not be regularised in service. Notwithstanding the same this  Court directed regularisation of services of all doctors appointed upto October 1, 1984 in consultation with UPSC on the evalu- ation  of their work and conduct based on  the  confidential reports  in respect of the period subsequent to  October  1, 1982.  Such  regularisation was to be from  the  dates  from which they were continuously working. The services of  those not regularised were allowed to be terminated. The petitions of  those appointed after October 1, 1984 were however  dis- missed.     In the case of Daily-rated Casual Labour employed  under P  & T Department through Bhartiya Dak Tar Mazdoor Manch  v.

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Union  of India & Ors., [1988] 1 SCC 122 this  Court,  while dealing  with the question of their absorption, referred  to the  State’s  obligations (referred to  as  an  individual’s rights)  under Part IV of the Constitution and  observed  as under: "Of  those  rights the question of security of  work  is  of utmost  importance.  If a person does not have  the  feeling that he belongs to an organization engaged in production  he will  not put forward his best effort to produce more.  That sense  of belonging arises only when he feels that  he  will not be turned out of employment the next day at the whim  of the management. It is for this reason it is being repeatedly observed  by those who are in charge of economic affairs  of the countries in different parts of the world that as far as possible security of work should be assured to the employees so  that they may contribute to the maximisation of  produc- tion.  It is again for this reason that managements and  the governmental agencies in particular should not allow workers to remain as casual labourers or temporary employees for  an unreasonable long period of time." This  Court  emphasised  that unless a  sense  of  belonging arises,  the worker will not give his best and  consequently production will suffer which in turn will result in economic loss  to  the nation. This Court,  therefore,  directed  the department  to  prepare  a scheme on a  rational  basis  for absorbing  those who have worked for a continuous period  of one year. 575     Tested  on the above and keeping in mind  the  constitu- tional philosophy adverted to earlier, we may now proceed to consider  the  main plank of the contention  raised  by  the Authority.  But before we do so we may dispose of  the  non- controversial part of the case.     From  the pleadings in this case one thing that  clearly emerges  is that the Authority had taken a decision on  30th January,  1987 to regularise the services of those who  were employed  by  the erstwhile PHED and  whose  services  stood transferred  to the Authority by the thrust of the  statute. According to the resolution extracted earlier, the Authority recommended to the State Government that the services of the employees recruited in the erstwhile PHED and who  continued to  work  on the establishment of the  Authority  should  be regularised.  The learned counsel for the  State  Government contended  that since these employees were now borne on  the establishment of the Authority on the statutory transfer  of their services, it was for the Authority to regularise their services, and it was quite unnecessary to make a recommenda- tion  to  the  State Government in that behalf.  To  put  it differently,  the stand of the State Government through  its counsel is that the question of regularisation of the  serv- ices of ex-PHED employees now borne on the establishment  of the  Authority  is  exclusively within the  purview  of  the Authority and the State Government has no role to play. That means it was wholly unnecessary on the part of the Authority to make the recommendation it made by the resolution of 30th January, 1987 to the State Government for the regularisation of  the  ex-PHED employees serving on its  establishment  on that  date. To us the position, therefore,  appears  crystal clear  that it is for the Authority and the Authority  alone to regularise the services of such employees without waiting for a nod from the State Government. The sphinx-like silence on the part of the State Government for now over three years from  the  date of the resolution is indeed  disturbing  and betrays total lack of concern for this pressing human  prob- lem.

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   The  second  batch of workers comprise  those  who  were appointed  between 1st April. 1984 and 4th August,  1986  by the  Authority  itself. Under section 8(1) of  the  Act  the power to appoint the Secretary and other officers and  staff members  vests in the Authority. Only when a post above  the rank  of  an Executive Engineer is to be  created  that  the sanction of the State Government becomes necessary under the proviso. Sub-section (2) to which sub-section (1) is subject expects  the Authority to seek the previous sanction of  the Government if it desires to employ a servant of the  Central or State Government on deputation and not otherwise. It  is, therefore, clear beyond any manner of doubt 576 that the power to appoint the staff-members with whom we are concerned,  solely vests in the Authority. Since the Act  is brought  into force w.e.f. 1st March, 1984 the  question  of regularisation  of the services of  staff-members  appointed after that date must be examined with reference to the power found in section 8(1) of the Act. However, the contention of the  Authority is based on Rule 9(a)(i) of the Rules,  which it claims to have adopted under Resolution No. 8 dated  25th April.  1984. The Authority contends that by the  thrust  of this rule the appointments were limited to 180 days only and since the said rules had statutory flavour the Authority was bound to act in accordance therewith. We have extracted  the relevant part of this rule earlier.  since these rules  were framed  in  exercise of power conferred by  the  proviso  to Article 309 of the Constitution they are undoubtedly  statu- tory  in character but Mr. Poti was right in his  contention that they do not retain that character in their  application to  the staff-members of the Authority since they have  been adopted  by  the Authority under a resolution.  These  rules would undoubtedly be statutory in character in their  appli- cation to the members of the Kerala Subordinate services for whom  they were enacted but when any other authority  adopts them  by  a resolution for regulating the  services  of  its staff,  the  rules do not continue to  remain  statutory  in their  application to the staff of that Authority. They  are like any other administrative rules which do not have statu- tory force. It was not contended, as indeed it could not That  these rules derive statutory force from section 64  or 65  of the Act. Section 64 confers the rule making power  on the  State while section 65 empowers the Authority  to  make regulations with the previous approval of the Government. It is nobody’s case that these rules were adopted after obtain- ing the previous approval of the Government. If that be  so. we  must accept Mr. Poti’s submission that these rule  their application to the staff members of the Authority  appointed after 1 st. April, 1984 have no statutory flavour or  force. Now  to the text of Rule 9(a)(i) of the Rules.  It  empowers the   appointing authority to appoint a  person  temporarily otherwise  than  in accordance with the rule if  (i)  it  is necessary  in  public  interest and  (ii)          where  an emergency  has arisen to fill any particular post which  has fallen vacant, immediately. In the present case it is diffi- cult  to  say that  all appointments made after  1st  April, 1984  were required to be filled immediately because  of  an emergency of the type contemplated by the said rule. On  the contrary it seems appointments were routinely made        in purported  exercise  of power conferred by  this  rule.  The proviso on which reliance is placed , which we have extract- ed earlier. merely  states that ordinarily such appointments will be of those persons who 577 possess  the requisite qualifications for the post.  If  any

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person who does not possess the requisite qualifications  is appointed  under  the said clause, he will be liable  to  be replaced  by  a  qualified person. Clause (iii)  of  Rule  9 states  that a person appointed under clause (i)  shall,  as soon as possible, be replaced by a member of the service  or an approved candidate qualified to hold the post. Clause (e) of  Rule 9, however, provided for regularisation of  service of any person appointed under clause (i) of sub-rule (a)  if he had completed continuous service of two years on December 22,  1973, notwithstanding anything contained in the  rules. This  is a clear indication that in the past the  Government also considered it just and fair to regularise the  services of  those who had been in continuous service for  two  years prior to the cut-off date. The spirit underlying this treat- ment  clearly shows that the Government did not consider  it just, fair or reasonable to terminate the services of  those who  were  in employment for a period of two or  more  years prior to the cut-off date. This approach is quite consistent with the spirit of the rule which was intended to be invoked to  serve emergent situations which could not  brook  delay. Such  appointments  were intended to be  stop-gap  temporary appointments  to serve the stated purpose and not long  term ones.  The rule was not intended to fill a large  number  of posts in the service but only those which could not be  kept vacant  till  regular appointments were made  in  accordance with  the  rules. But once the  appointments  continued  for long,  the services had to be regularised if  the  incumbent possessed  the requisite qualifications as was done by  sub- rule  (e). Such an approach alone would be  consistent  with the  constitutional  philosophy adverted  to  earlier.  Even otherwise, the rule must be so interpreted, if the  language of the rule permits, as will advance this philosophy of  the Constitution.  If the rule is so interpreted it seems  clear to us that employees who have been working on the establish- ment  since long, and who possess the  requisite  qualifica- tions for the job as obtaining on the date of their  employ- ment,  must be allowed to continue on their jobs  and  their services should be regularised. It is unfair and  unreasona- ble  to remove people who have been rendering service  since sometime  as  such  removal has  serious  consequences.  The family  of the employee which has settled down and  accommo- dated  its  needs to the emoluments received  by  the  bread winner, will face economic ruination if the job is  suddenly taken  away.  Besides,  the precious period  of  early  life devoted  in the service of the establishment will be  wholly wasted  and the incumbent may be rendered ‘age  barred’  for securing  a job elsewhere. It is indeed unfair to  use  him, generate  hope and a feeling of security in him  attune  his family  to  live within his earnings and then  suddenly-  to throw him out of job. Such behaviour would be an 578 affront to the concept of job security and would run counter to  the constitutional philosophy, particularly the  concept of  right to work in Article 41 of the Constitution.  There- fore,  if  we interpret Rule 9(a)(i) consistently  with  the spirit  and  philosophy  of the Constitution,  which  it  is permissible  to do without doing violence to the said  rule, it follows that employees who are serving on the  establish- ment  for long spells and have the requisite  qualifications for  the  job, should not be thrown out but  their  services should  be  regularised as far as  possible.  Since  workers belonging  to  this  batch have worked on  their  posts  for reasonably  long spells they are entitled to  regularisation in service.     The  third and fourth batches concern workers  who  were

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appointed  between 4th August, 1986 and 30th July, 1988  and after  30th  July, 1988,  respectively.  Their  appointments would be governed by Section 69 which became effective  from 4th  August,  1986.  By virtue of this  section  the  Kerala Public  Service  (Additional Functions  as  respect  certain Corporations  and Companies) Act, 1970 (19 of 1970) came  to be  amended with effect from 4th August, 1968 on which  date it  came to be published in the Gazette. Thereby  in  clause (a)  of  section 2 the "Kerala Water Authority" came  to  be added.  In law, therefore, the need to consult the  PSC  had arisen.  True  it  is that  the  consequential  notification amending  the 1971 Rules was issued on 30th July, 1988.  But on that account we do not think it would be proper to  treat them  differently.  We think it advisable to treat  them  as forming a single batch since the need to consult the PSC had arisen  on  Section 69 coming into effect from  4th  August, 1986.     In the result we allow these appeals and writ  petitions and make the rule absolute as under: "(1) The Authority will with immediate effect regularise the services  of all ex-PHED employees as per its Resolution  of 30th  January,  1987 without waiting  for  State  Government approval. (2)  The services of workers employed by the  Authority  be- tween  1st April, 1984 and 4th August, 1986 will be  regula- rised  with immediate effect if they possess  the  requisite qualifications  for the post prescribed on the date  of  ap- pointment of the concerned worker. (3) The services of workers appointed after 4th August, 1984 and possessing the requisite qualifications should be  regu- lated  in accordance with Act 19 of 1970 provided they  have put in continuous service of not less than one year, artifi- cial breaks, if any, 579 to be ignored. The Kerala Service Public Service  Commission will take immediate steps to regularise their services as  a separate  block. In so doing the Kerala Public Service  Com- mission will take the age bar as waived.        (4) The Kerala Public Service Commission will consid- er the question of regularisation of the services of workers who  possess  the requisite qualifications but have  put  in less  than one year’s service, separately. In doing  so  the Kerala  Public Service Commission will take the age  bar  as waived.  If  they are found fit they will be placed  on  the list along with the newly recruited candidates in the  order of  their respective merits. The Kerala Public Service  Com- mission  will  be free to rearrange  the  list  accordingly. Thereafter  fresh appointments will issue depending  on  the total  number  of posts available. If the posts  are  inade- quate, those presently in employment will make room for  the selected candidates but their names will remain on the  list and  they will be entitled to appointment as and when  their turn arrives in regular course. The list will enure for such period as is permissible under the extant rules. (5) The Authority will be at liberty to deal with the  serv- ices of the workers who do not possess the requisite  quali- fications as may be it considered appropriate in  accordance with law. (6)  Those  workers whose services have been  terminated  in violation of this Court’s order in respect of which Contempt Petition  No. 156 of 1990 is taken out shall be entitled  to the benefit of this order as if they continue in service and the  case  of  each worker will be governed  by  the  clause applicable  to  him depending on the category  to  which  he belongs  and if he is found eligible for  regularisation  he

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will be restored to service and assigned his proper place. This  order will regulate the services not only of the  par- ties to the present petitions but also all others  similarly situated  including those who may be parties to  other  pro- ceedings pending in different Courts.     If  further  directions are required in  the  matter  of working out of the above order the High Court of Kerala  may be approached for the same. All the aforestated  proceedings are disposed of accordingly with no order as to costs. Y.  Lal                              Appeals  and  petitions allowed. 580