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CASE NO.: Appeal (civil)  1120 of 2007

PETITIONER: GURBACHAN LAL

RESPONDENT: REGIONAL ENGINEERING COLLEGE, KURUKSHETRA & ORS

DATE OF JUDGMENT: 01/03/2007

BENCH: DR. AR. LAKSHMANAN & TARUN CHATTERJEE

JUDGMENT: JUDGMENT (Arising out of SLP (CIVIL) NO. 14579-80/2005)

TARUN CHATTERJEE, J.

       Leave granted.                  The present dispute arises out of termination of services  of Gurbachan Lal (the appellant herein) by the Regional  Engineering College, Kurukshetra (the respondent herein).                  In 1986, the Department of Science and Technology,  Government of India established National Science and  Technology Entrepreneurship Development Board (hereinafter  called "NSTEDB") to encourage and promote entrepreneurship  amongst the science and technology persons. NSTEDB, with  the same objective, set up Establishment Development Cells (in  short EDC) in various educational institutions. The Scheme as  framed by NSTEDB stated that Department of Science and  Technology (in short DST) would provide financial assistance  for a period of three years or till the end of the 7th Five Year  Plan, whichever would be earlier after which the educational  institution would be under the responsibility to continue its  functioning and that the EDC should merge into the  mainstream of the Institution for continuous running along  with its faculty and staff. The Institution established the EDC  in it and invited applications for the post of Chief Project  Coordinator for which the minimum qualifications included  that the candidate must be at least a graduate in engineering/  technology or a post graduate in any branch of Science,  Mathematics, Economics or Business Administration with ten  years’ of experience in industries or entrepreneurship  development of which minimum five years in a position of  responsibility.                  In pursuance of this scheme, on 12th April 1989, the  Institution advertised for the said post in the EDC for which the  appellant applied. However, he was appointed in the post of  Senior Project Leader by an appointment letter dated      9th  August 1989 which categorically stated as follows:

"1.Appointment:         Temporary[emphasis added] 2. Scale of Pay:        Rs. 1200-50-1300-60-1900  (unrevised) 3. Initial Pay: You are allowed a basic pay of  Rs.1600 in the unrevised scale  of pay of Rs.1200-1900. Total  emoluments shall be Rs. 4630  excluding HRA. This is

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equivalent to the stage of Rs.  3700 in the revised scale Rs.  3700-125-4950-150-5700. The  total emoluments are Rs. 4715  excluding HRA. The approval of the revised  pay scale is awaited from the  State Government. This is  likely to be received shortly.  You will be placed at the basic  pay of Rs. 3700 in the revised  pay scale of Rs. 3700-5700  from the date of your joining.  The arrears will be put to you  on implementation of the  revised pay scale.  

4. Allowances:  You will receive any  allowances admissible under  the Rules of the College from  time to time.  

5. Date of Next Increment:      One year after from the date of  your joining the post.

6\005   x       x       x       x       x        

7\005   x       x       x       x       x

8\005   x       x       x       x       x

9. Leave:       You will be governed by the  leave rules of the college from  time to time.  

10. Conduct & Discipline:       You will be governed by the  conduct and disciplinary rules  of the college from time to time.

11. Termination of service: Your service is liable to be  terminated by either side  without assigning any reason  of one month’s notice in  writing or on payment of on  month’s pay and allowance in  lieu thereof.  However, you will  not be allowed to leave the  service during semester  studies." [emphasis added]

       We have examined the terms and conditions of the  appointment letter of the appellant, as quoted herein above.  Condition no.1 clearly indicates that the appointment of the  appellant was purely temporary which can be terminated  without assigning any reason by giving one month’s notice in  writing or on payment of one month’s salary and allowances in  lieu thereof. It was stipulated in the letter of appointment that  the appellant would be entitled to revised pay scale which was  awaited from the State Government for the employees of the  Institution. However, the appointment letter indicated that he  would also receive allowances admissible under the rules of the  Institution from time to time. Clause 5 of the appointment letter  also indicated that the date of next increment would be one  year after the date of joining the post. From a close scrutiny of

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the letter of appointment, it is evident that the appointment of  the appellant in the above post was temporary which could be  terminated by either of the parties without assigning any  reason by giving one month’s notice or payment of one month’s  pay and allowances in lieu thereof.           However, condition no. 10 of the appointment letter says  that allowances payable to the employee of the Institution  under its rules, as applicable from time to time shall also be  payable to the appellant.  

The Board of Governors of the Institution had approved  the creation of the EDC in it on the basis of grant-in-aid  released by the Government of India, Ministry of Human  Resource Development.  It was noted in the Scheme that the  fund for EDC was sanctioned up to the end of the 7th Five Year  Plan but was likely to continue in the 8th Plan also as a central  scheme.  It was further resolved that the staff salary and  miscellaneous operational expenses shall be met from the  grants in aid received under the Scheme of the EDC but  ultimately the Institution will have to generate its own  resources to continue with it.   Before we proceed further, we may state that the  appellant in the writ petition alleged mala fide on the part of the  Principal of the Institution. In order to show that the Principal  of the Institution had acted in a mala fide manner against him,  the appellant alleged the following facts:-  

The appellant applied for Ph.D. registration under the  Principal of the Institution (herein Respondent No. 5) as the  main guide but withdrew because work was not satisfactory  and applied for Ph.D. under the guidance of the next senior  most professor. The appellant claimed that this upset the  Principal of the Institution and he became prejudiced against  him which was evident in many instances such as the one on  16th August 1999 when the Principal of the Institution allotted  official accommodation in the Institution campus to a junior  staff, ignoring the claim of the appellant who was a member of  the senior staff. However, we need not proceed further on the  question of mala fides on the part of the Principal of the  Institution as we find that such ground was not agitated by the  appellant either before the Learned Single Judge or the Division  Bench of the High Court.  

The appellant also stated that on 5th November 1999, a  notification was issued by Haryana Government revising the  pay scales of teachers working in the Institution. According to  the appellant, he was eligible for the revised pay scale but was  denied the benefits of it. He made representations in this regard  but was not heard.  

A writ petition being W.P. No. No. 15371 of 2000 was filed  by the appellant on 9th November 2000 before the High Court of  the State of Punjab and Haryana at Chandigarh praying for  issuing an appropriate writ directing the respondents to pay the  revised pay scale with pay fixation and to confirm the appellant  as Assistant professor and grant any other relief as may be  appropriate.  

The Institution stopped the salary of the appellant from  May 2001 to which he made representations and prayed for  release of his pay. The Principal of the Institution released the  salary to the appellant but asked him to arrange for it in future  from the concerned authority. It was asserted that owing to the

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mental harassment, the appellant suffered heart attack and  had to undergo an open heart bye-pass surgery. He claimed  reimbursement of Rs. 74,492 towards medical claim but it was  stopped by the Principal of the Institution. Representations for  release of his salary and reimbursement of medical bill were  made by the appellant.

On 31st November 2001, the appellant received            6  months’ salary from June, 2001 to November 2001. However,  medical reimbursement was not released. The salary of the  appellant was stopped from January 2002 for which he filed a  representation for its release. The Institution instead of  releasing the salary, asked the appellant to approach the  funding agency for release of funds.

On 28th February 2002, the appellant received notice for  termination of service and no salary was paid to him for the  notice period. Another writ petition was filed by the appellant  before the High Court being WP no. 4579 of 2002 challenging  his termination order.

On 2nd April, 2004, both the Writ Petitions filed by the  appellant were allowed by the Learned Single Judge of the High  Court by a common judgment. The Learned Single Judge was of  the opinion that from the perusal of the documents brought on  record, it was evident that there was an obligation on the part  of the Institution to absorb the faculty members and other staff  of the EDC and that it could not shun its responsibilities after  enjoying financial benefits for twelve years and thus was  estopped from going back from its obligations. The Learned  Single Judge further held that it was the obligation of the  Institution to merge the members of EDC in its mainstream.  The Learned Single Judge also held that the appellant must be  paid his salary in accordance with the revised pay scale.

Aggrieved by the orders in the aforesaid writ petitions, the  Institution filed a Letter Patent Appeal being LPA          No.138/2004. In this LPA, it was pointed out by the Principal of  the Institution that it was the decision of the Board of  Governors not to merge EDC with the regular establishment of  the Institution. Since the appellant was never appointed in the  regular establishment, there was no question of allotment of a  quarter. It was also pointed out that since the salaries of the  staff of the EDC were being paid out of the financial assistance  received from the DST, which was eventually withdrawn, the  appellant could not be an employee of the Institution.  

It was observed by the High Court that in the present  case, the post advertised was that of a Chief Project Coordinator  whereas the appellant was appointed as Senior Project Leader  on temporary basis in the EDC. The High Court in the LPA had  further observed that the appointment of the appellant could  not confer any right on him as Assistant Professor, which is a  regular post and could be filled only after giving an opportunity  to all eligible candidates to apply for the post and after following  the relevant rules of the Institution.

In the LPA it was also observed that the appellant could  not seek merger of the EDC with the Institution but considering  the fact that he had worked for more than ten years with the  Institution, it directed that the appellant be granted relaxation  in age for the post of Assistant Professor as and when the post  is advertised so that he is able to compete with other eligible  candidates to seek appointment on regular basis.     

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Aggrieved by the said order, the appellant filed the special  leave petitions in respect of which leave has been granted.

We have heard the learned senior counsel appearing for  the parties.  Mr. P.P. Rao, learned senior counsel appearing on  behalf of the appellant made mainly two-fold submissions.  First, Mr. Rao contended that in view of the guidelines framed  by the Government of India, as noted herein earlier, the EDC  was to be merged with the main stream of the Institution after  the financial assistance was withdrawn by the Central  Government.  Accordingly, Mr. Rao submitted that it could not  be said that the scheme came to an end as soon as the financial  assistance by the Central Government was withdrawn.  Mr. Rao  further submitted that it would be evident from the guidelines  that it was the duty of the Institution to continue with the  scheme after the financial assistance was withdrawn and  accordingly the appellant, with the merger of the EDC with the  main stream of the Institution, became an employee of the  Institution itself.  Mr. Rao further submitted that in view of the  fact that an undertaking was also filed at the time the scheme  was approved by the Central Government, that after the  financial assistance was withdrawn by it, the Institution ought  to have taken over the liability and continued to run the  scheme, it was not open to the Institution to say that it was not  in a position to continue with the scheme for financial  stringency.  Accordingly, Mr. Rao contended that the services of  the appellant could not be terminated without following the  procedure for termination or dismissal from service like that of  the regular employees of the Institution.  In support of this  contention, Mr. Rao relied on a decision of this Court in the  case of State of Maharashtra and Ors. v. Association of  Maharashtra Education Services Class II Officers and Ors.  [ 1974 [4] SCC 706].  Mr. Rao had drawn our attention to  paragraph 7 of the said decision and contended that it was not  open to the Board of Governors of the Institution to depart from  the rudiments of the scheme and to device a new mechanism  entailing the imposition of fresh conditions as a pre-requisite to  eligibility for the higher pay scale.  

Secondly, it was contended by Mr. Rao that assuming  that the EDC could not be merged with the Institution even  then the appellant could not be said to be a temporary  employee of the Institution as he acted as Assistant Professor  for more than ten years in the same and, therefore, he became  a permanent employee of the Institution. Accordingly, it was  argued that the procedure for termination of services relating to  the employees of the Institution should be followed and as the  Board of Governors of the Institution not having followed such  procedure of termination in the case of the appellant, the order  of termination cannot be sustained.  

Mr. Mahabir Singh, learned senior counsel for the  respondents refuted the aforesaid two submissions put forth by  Mr. Rao.  According to Mr. Singh, the EDC came to an end on  the stoppage of grant by the Central Government to the  Institution.  Therefore, the order of termination of service of the  appellant who was appointed purely on temporary basis under  a Scheme which came to an end on stoppage of grant by the  Central Government it could not be said to be bad, illegal and  invalid in law and that being the position, it was not open for  the appellant to contend that he became a permanent employee  of the Institution as he served it for more than ten years.     Mr. Singh, in support of his contention, relying on a  Constitution Bench decision of this Court in State of

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Karnataka v. Uma Devi [2006 [4] SCC 1] contended that the  appointment of the appellant being temporary in nature, as  would be evident from Clauses 1 and 11 of the appointment  letter, as noted herein earlier would clearly show that the  service of the appellant could be terminated by either of the  parties by giving one month’s notice with pay and allowances  and in view of the fact that the appellant was appointed on the  basis of a scheme namely the EDC, which had come to an end,  the Division Bench of the High Court was fully justified in  observing that no occasion could arise for the Learned Single  Judge to hold that the appellant had automatically become  permanent in the Institution.  He further contended that on a  plain reading of the guidelines relating to the EDC it could not  be said that the Board of Governors of the Institution had no  right to direct that in view of the financial difficulties it would  not continue with the EDC.

We have considered the arguments advanced by the  learned counsel for the parties in depth and in detail. Let us  first deal with the submission of Mr. Rao that the Scheme could  not come to an end in view of the conditions to the proposal for  establishment of the EDC and on stoppage of funds from the  Central Government to run the EDC. We are unable to accept  this submission of Mr. Rao.

It is true that Clause 4 of the proposal of the  establishment of EDC says that it was the responsibility of the  Institution to absorb the EDC established along with its faculty  and staff, in usual academic stream of the Institution, after  expiry of the period of assistance from DST was provided.  However, if we read this clause more minutely along with other  clauses of the proposal for establishment of EDC, it would be  difficult for us to hold that clause 4 of the said proposal can at  all be said to be mandatory in nature.  

Keeping in mind that the guidelines relating to the  proposal of establishment of the EDC was not mandatory in  nature, we need to proceed to consider the factual aspects  relating to this question. It is true that initially a resolution was  taken to continue with the Scheme, but on reconsideration of  the same, finally a resolution was taken on 19th November  2001 to the effect that merger with the Institution was not  possible in view of financial stringency. However, the Board of  Governors of the Institution in that resolution advised that  efforts may be made to introduce a Scheme or project such as  Industrial Institute Partnership Cell sponsored for the  Institution by the All India Council of Technical Education.   

However, as argued by Mr. Rao, it was the responsibility  of the Institution to take over the EDC and run and merge the  same with it. It is an admitted position that the EDC was  constituted by the Central Government for which necessary  funds were allocated year after year till 31st March 2002. It is  also an admitted position that after 31st March 2002 it was  made known to the Institution that financial assistance would  not be given and it would be for the Institution to merge the  EDC with it. The initial recommendation of the advisory  committee of the Institution which was formed to find the  feasibility of the scheme to continue was considered by the  Board of Governors of the Institution and thereafter the Board  of Governors decided not to merge the EDC with it. It is in  pursuance of this resolution of the Board of Governors that the  scheme of EDC could not continue and had come to an end.  It  can also be said in this connection that the Board of Governors  of the Institution were within their jurisdiction to take a

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decision whether the EDC, i.e. the scheme was to be merged  with the Institution or not. Such a decision had to be taken by  the Board of Governors on the basis of the requirement of the  Institution by taking into consideration its financial conditions  and other relevant factors. It cannot also be denied that the  appellant could not claim any vested or enforceable legal right  to claim absorption in the Institution as even a regular post in  the Institution can be abolished on account of non-availability  of work or funds. As noted herein earlier, it was upon the Board  of Governors to decide whether to merge the EDC with the  Institution or not. It was not for the appellant to approach the  High Court under Article 226 of the Constitution claiming any  declaration that he was entitled to be absorbed in the  Institution in the regular scale of pay even though the  Institution had not appointed the appellant on any of the  regular posts but such appointment was solely on basis of the  scheme. For the reasons aforesaid the order of termination  issued to the appellant cannot be said to be bad in law and  accordingly we are in agreement with the Division Bench of the  High Court which held that the scheme had come to an end  with the stoppage of the grant by the Central Government. That  being the position the appellant was not entitled to claim  absorption in the end with the main stream, i.e. with the  Institution nor he would be entitled to say that he became a  permanent employee of it.  

Reliance can be placed in the case of Managing Director  of UP Land Development Corporation v. Amar Singh [ 2003  (5) SCC 388] in which this court clearly observed as follows:  

"In clear and certain terms it is stated that when  the project comes to a close, the employees who are  working in a project will not get any vested right. In  other words, once a project comes to an end,  services of the employees also come to an end. The  other decisions cited by the Learned Counsel more  or less are to the same effect."

In State of Himachal Pradesh v. Nodha Ram, AIR  1997 SC 1445, this court while dealing with the case of a  temporary employee appointed on the basis of a project which  had been closed down observed as under :

"It is seen that when the project is completed  and closed due to non-availability of funds, the  employees have to go along with its closure. The  High Court was not right in giving the direction to  regularize them or to continue them in other  places. No vested right is created in temporary  employment. Directions cannot be given to  regularize their services in the absence of any  existing vacancies nor can directions be given to  the State to create posts in a non-existent  establishment. The Court would adopt pragmatic  approach in giving directions. The directions would  amount to creating of posts and continuing them  despite non-availability of the work. We are of the  considered view that the directions issued by the  High Court are absolutely illegal warranting our  interference. The order of the High Court is,  therefore, set aside. "  (Emphasis supplied)  

Similarly in the case of Mahendra L. Jain v. Indore  Development Authority & Others, [2005 (1) 639] it has also  been held that the employees employed for the purpose of a

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Scheme which has been subsequently closed down do not  acquire any vested right or enforceable legal right to continue  with the scheme nor could such employees approach the court  for a declaration to continue with the scheme after the project  was over.  

That apart, the appellant was not appointed in the post  which was advertised, but was appointed as a Senior Project  Leader, therefore, the Division Bench was justified in holding  that the appellant was not appointed in a sanctioned post. In  view of the discussions made hereinabove, the question of  regularization of the appellant in the main stream of the  Institution could not arise at all nor it could be said that the  appellant became a permanent employee of the Institution as  the scheme came to an end.   Therefore, it may safely be  concluded that since the scheme had come to an end as soon  as the financial assistance to the Institution was withdrawn  and as the Board of Governors of the Institution had decided  not to continue with the scheme and not to merge the same  with the Institution, it cannot be said that merely because there  was a clause in the advertisement that the post of the appellant  was likely to continue, the appellant had acquired any right  whatsoever to become a permanent employee of the Institution,  nor had he acquired any vested right to continue in his  position. In any view of the matter, as he was appointed purely  on temporary basis and the scheme had already come to an  end, the appellant was not entitled to any relief to the extent  that he had become a permanent employee of the Institution  itself.

One more fact needs our attention which is borne out  from the record.   It appears that during the pendency of the  writ petition before the High Court, a new scheme, namely,  Industry Institute Partnership Cell came into existence and  under the said Scheme the appellant was offered a fresh  assignment which he had already accepted and he is presently  associated with the same.  Such being the state of affairs now,  it would not be open to the appellant to allege that the scheme  under which he was appointed initially  continued to run even  after his accepting the offer under a new Scheme with which he  is now associated.   

Before parting with this part of the submissions of    Mr.  Rao, we may also take note of the fact that in the appointment  letter of the appellant, it would not be evident that the services  of the appellant shall be absorbed in the Institution. At the risk  of repetition, we also observed, as noted herein earlier, that the  Board of Governors had inherent right to consider the  justifiability of continuation of the Scheme or any post or work  keeping in mind the requirement of the Institution. In this  connection we add that the Board of Governors of the  Institution had considered all the relevant factors and  thereafter had taken a resolution not to merge the Scheme with  the Institution or continue with it. It is always open to the  Board of Governors to create a post and also to abolish any  post which would not be required to be continued in their  opinion.  

For the reasons aforesaid, we do not agree with       Mr.  Rao’s arguments on the first submission.

Coming back to the discussions of this Court in the case  of State of Maharashtra v. Association of Maharashtra  Education Services Class II Officers (supra) and considering  minutely para 7 of the same on which strong reliance was

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placed by Mr. Rao, we are of the view that this decision would  not be helpful to the appellant. In that decision, this Court was  dealing with the true nature of the scheme envisaged in the  Report of the University Grants Commission for the year 1966- 67 relating to the pay scales of lecturers and professors in the  affiliated colleges accepted by the Government of Maharashtra.  In that context, this Court in para 7 held that even though the  lecturers who held second-class masters degree and approved  by the university as postgraduate teachers since 1st April 1966  were entitled to the higher pay scale under the report of the  University Grant Commission accepted by the Government of  India. In that context, this court held that it was not right for  the State Government to depart from the rudiments of that  scheme and to device a new mechanism entailing the  imposition of fresh conditions as a pre-requisite to eligibility for  the higher pay scale.

In the present case, the situation is quite different. As  noted herein earlier, the EDC was constituted on the guidelines  in respect of which reference has been made earlier. In view of  our interpretation of Clause 4 and other clauses of the proposal  to establish the EDC, we have already come to a conclusion  that the guidelines for vesting of the EDC with the Institution  was not mandatory in nature and the scheme came to an end.  The question of absorption of the appellant in the end after the  closure of the scheme cannot therefore arise at all.  

Coming to the question whether the service conditions  could be amended to the disadvantage of the employee, as per  the facts presented before us it is clear that there existed a  contract of employment between the appellant and the  Institution. Moreover, the nature of employment was explicitly  laid down in the appointment letter, as noted herein earlier, to  which the appellant had communicated his acceptance, as  temporary. Therefore, it is valid in law for the Institution to  terminate the appellant from service in a manner, which did not  favour him.  

The constitution bench of this court in Secretary, State  of Karnataka v. Uma Devi (supra), specifically held that  mainly because a temporary employee had continued beyond  the term of employment for which he was employed such  employee would not be entitled to any right to be made  permanent in service if the original appointment was not made  by following due process. It was further held that it was not  open to the court to prevent regular recruitment at the instance  of such employees.  

Accordingly, the decisions of this court directing  regularization and permanent continuation of temporary  employee recruited under a scheme on issuance of direction by  court were overruled.  

However, the learned senior counsel appearing for the  appellant relied on para 53 of the said decision and contended  that the appellant had acted as an assistant professor for more  than ten years and therefore would be entitled to be absorbed  or regularized in the mainstream of the Institution.  

In Para 53 of the said decision, this Court observed as  follows:  "One aspect needs to be clarified. There may  be cases where irregular appointments (not illegal  appointments) as explained in S.V. Narayanappa  (supra), R.N. Nanjundappa (supra), and B.N.

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Nagarajan (supra), and referred to in paragraph 15  above, of duly qualified persons in duly sanctioned  vacant posts might have been made and the  employees have continued to work for ten years or  more but without the intervention of orders of  courts or of tribunals. The question of  regularization of the services of such employees  may have to be considered on merits in the light of  the principles settled by this Court in the cases  above referred to and in the light of this judgment.  In that context, the Union of India, the State  Governments and their instrumentalities should  take steps to regularize as a one time measure, the  services of such irregularly appointed, who have  worked for ten years or more in duly sanctioned  posts but not under cover of orders of courts or of  tribunals and should further ensure that regular  recruitments are undertaken to fill those vacant  sanctioned posts that require to be filled up, in  cases where temporary employees or daily wagers  are being now employed. The process must be set  in motion within six months from this date. We  also clarify that regularization, if any already made,  but not subjudice, need not be reopened based on  this judgment, but there should be no further by- passing of the constitutional requirement and  regularizing or making permanent, those not duly  appointed as per the constitutional scheme." (Underlining is ours) Having carefully examined para 53 of the Uma Devi’s  case and also the other relevant paras of the same relating to  the absorption/regularization of temporary employees, we are  unable to accept the contention of the learned senior counsel  appearing on behalf of the appellant.  

In para 52 of the Uma Devi’s case, this court has made it  clear that a mandamus cannot be issued in favour of the  employees directing the Government, either State or Central  Government, to make those employees permanent since the  employees cannot show that they have an enforceable legal  right to be absorbed or the Central Government or the State  Government, as the case may be, is duty bound to make them  permanent.

This is the general observation of this court subject to  para 53 of the same, but we are of the view that para 53 which  makes a distinction of employees who have been continuously  working for more than ten years in a sanctioned post stand on  a different footing.  

In our view para 53 will not help the appellant although  the appellant in the present case continued to work in the EDC  for more than ten years. It is true that in that para, this court  observed that although the appointment was irregular and not  illegal, the State Government or the Central Government, as the  case may be, should take steps to regularize the employees who  had continued to work for more than ten years. The observation  made by the Constitution Bench in para 53 of the Uma Devi  case may not be helpful to the appellant because

1.      He was appointed on the basis of a scheme which from  the appointment letter clearly proves that his appointment was  temporary in nature and would come to an end with the closure  of the EDC.

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2.      Since the appellant was not appointed in a duly  sanctioned vacant post, we do not think that the observation  made by this Court in para 53 would come to his aid at all.

We may also note that observations made by the  Constitution Bench in the case of Uma Devi (supra) to the  effect that the sovereign government after considering the  economic situation in the country and work to be got done,  cannot be precluded from making temporary appointments or  engaging temporary workers or daily wagers which clearly  indicates that the power of the authority to appoint temporary  employees was accepted by this Court but the fact remains that  such appointment shall remain temporary in nature which can  be terminated at any point of time.

In the present case the appellant continued to work for  ten years or more but such continuous temporary employment  of the appellant cannot vest any legal right in him to continue  when the scheme itself on the basis of which he was appointed  and was working itself came to an end. It is also incorrect to  say that the court would direct continuity of the scheme for the  purpose of keeping the appellant in service and in any view of  the matter he could not be treated as a permanent employee of  the Institution as he was appointed under a scheme and not in  the mainstream of the Institution.  

At this juncture we may observe that the Constitution  Bench held that the recruitment could only be made through a  prescribed procedure. In the case of State of Haryana v.  Piyara Singh, [(1992) 5 JT 179], a bench of three Hon’ble  Judges pointed out that some exigencies of administration may  call for temporary appointment to be made and further held  that in such a situation efforts should be made to replace such  an ad hoc or temporary employee by a regularly selected  employee as early as possible. In that situation it would be open  to the said employees to compete with others for regular  selection or appointment. The decision of this court in the  Piyara Singh case (supra) had given reasons when  regularization could be made although it was kept in mind that  the normal rule was to recruit persons as a regular employee  through a prescribed procedure.

Let us trace back to the year 1987 when this Court in the  case of Daily Rated Casual Labour Employed under P&T  Department V.  Union of India, [AIR 1987 SC 2342], in para 6  observed as follows:  

"It may be true that the petitioners have not been  regularly recruited but many of them have been  working continuously for more than a, year in the  Department and some of them have been engaged  as casual labourers for nearly ten years. They are  rendering the same kind of service, which is being  rendered by the regular employees doing the same  type of work. Clause (2) of Article 38 of the  Constitution of India which contains one of the  Directive Principles of State Policy provides that  "the State shall, in particular, strive to minimize  the inequalities in income, and endeavor to  eliminate inequalities in status, facilities and  opportunities, not only amongst individuals but  also amongst groups of people residing indifferent  areas or engaged in different vocations." Even  though the above Directive Principle may not be  enforceable as such by virtue of Article 37 of the

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Constitution of India, it may be relied upon by the  petitioners to show that in the instant case they  have been subjected to hostile discrimination. It is  urged that the State cannot deny at least the  minimum pay in the pay scales of regularly  employed workmen even though the Government  may not be compelled to extend all the benefits  enjoyed by regularly recruited employees. We are of  the view that such denial amounts to exploitation  of labour. The Government cannot take advantage  of its dominant position, and compel any worker to  work even as a casual labourer on starving wages.  It may be that the casual labourer has agreed to  work on such low wages. That he has done because  he has no other choice. It is poverty that has driven  him to that State. The Government should be a  model employer. We are of the view that on the  facts and in the circumstances of this case the  classification of employees into regularly recruited  employees and casual employees for the purpose of  paying less than the minimum pay payable to  employee in the corresponding regular cadres  particularly in the lowest rungs of the department  where the pay scales are the lowest is not tenable.  The further classification of casual labourers into  three categories namely (i) those who have not  completed 720 days of service; (ii) those who have  completed 720 days of service and not completed  1200 days of service and (iii) those who have  completed more than 1200 days of service for  purpose of payment of different rates of wages is  equally untenable. There is clearly no justification  for doing so. Such a classification is violative of  Articles 14 and 16 of the Constitution. It is also  opposed to the spirit of Article 7 of the  International Covenant on Economic, Social and  Cultural Rights, 1966 which exhorts all States  parties to ensure fair wages and equal wages for  equal work. We feel that there is substance in the  contention of the petitioners."  (Underlining is ours) In para 8 of this decision, the Supreme Court held  "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 would 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 maximization of production.  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."  (underlining is ours)

From the above observation of this Court in Daily Rated  Casual Labour Employed under P&T Department Vs.  Union

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of India (supra), it was made clear that regularization or  absorption can be made of temporary employee because unless  a sense of belonging arises, the employee will not give his best  and consequently production will suffer which in turn will  result in economic loss to the nation. Keeping this in mind, this  Court directed the government to prepare a scheme on a  rational basis for absorbing those who have worked for a  continuous period of one year. This court in this decision  further observed that non-regularization of temporary  employees for a long time was not a wise policy and direction  was given to the Central Government to prepare a scheme for  the absorption of the casual labourers as far as possible who  had been continuously working for more than a year in the  department.

Further, in Jacob M. Puthuparambil V. Kerala Water  Authority, [(1991) 1 SCC 28], this court, while interpreting  Rule 9 of Kerala State and Subordinate Service Rules, 1958  observed as under:  

"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 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- leave-it terms offered by the employer. Such terms  of employment offer no job security and the  employee is left to the mercy of the employer.  Employers have betrayed an increasing tendency to  employ temporary hands even on regular and  permanent jobs with a view to circumventing the  protection 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." (Underlining is ours) This court, while interpreting the provisions namely Rule  9 of Kerala State and Subordinate Service Rules, 1958 and  keeping the spirit and philosophy of the Constitution to attain  socio-economic justice as quoted above, held that employees  who were serving in the establishment for long spells and had  the requisite qualifications for the job, should not be thrown  out but their services should be regularised as far as possible.  It was of the opinion that on interpreting the relevant clause, if  it was found that services, which had continued for a long time,  had to be regularized if the incumbent possessed the requisite  qualifications.

At this juncture we may observe that the aforesaid  decisions of this court which were overruled by the Constitution  Bench decision in which reasons for giving directions to absorb  temporary employees were on solid foundation which, however  was not dealt with by the constitution bench at the time of  overruling them. The reasons given in the aforesaid decisions  which stand on solid footing, need to be considered in the light  of the right of asking for absorption as permanent employees  under the government is a ground which needs to be  reconsidered. Be that as it may, the constitution bench decision  having overruled the above decisions, we need not delve any  further on this aspect of this matter.  

Therefore, since the service of the appellant was

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temporary in nature; appointed under a scheme which had  come to an end and he had joined the service in complete  recognition and acceptance of the conditions and further had  already accepted fresh assignment on the basis of a new  scheme as noted herein earlier, it cannot be said that  termination of his service was invalid in law. Therefore, the  stand of the appellant that it is not open to the Board of  Governors of the Institution to say that they were unable to  continue with the EDC and thereby terminating the services of  the appellant, does not hold good.

The appellant, as noted herein earlier, was appointed on  the basis of the appointment letter and was paid on the basis of  such appointment letter till January, 2002.  There is no dispute  that the appellant was paid his salary and other emoluments as  permissible under the rules of the Institution up to December  2001. Only the salary and other emoluments from the month of  January 2002 was not paid. The order of termination was  passed on 28th February 2002 in which one-month salary with  allowances was to be paid in lieu of the termination order which  was also not paid. As per the appointment letter, the appellant  was covered under the rules of the Institution and salary was  paid in accordance with the said rules applicable to the  employees of the Institution. Since the appointment letter  clearly indicates that the services of the appellant shall be  governed by the service rules of the employees of the  Institution, we do not find any reason why the appellant should  not be paid salary and other emoluments from January 2002 to  March 2002. We accordingly direct the authority of the  Institution to pay salary and other emoluments from January  2002 to      March 2002 with all allowances permissible under  the Rules, if not paid in the meantime.                                                                  

There is yet another aspect of this matter. A claim was  made by the appellant for reimbursement of his medical bills to  the extent of Rs. 74,492/-. Whether the appellant was entitled  to get medical benefits or not, we have to look into the  appointment letter of the appellant. From the appointment  letter it is clear that whatever benefits the employees of the  Institution are entitled to, the appellant is also entitled to such  benefits. We have not been shown by the appellant that either  the Learned Single Judge of the High Court or the Division  Bench of the High Court had dealt with the claim of  reimbursement of the medical bill. In this view of the matter, we  are unable to go into the question whether the employees of the  Institution are eligible to get medical reimbursement. We are  thus not in a position to allow the prayer. However, we leave it  open to the appellant to claim reimbursement of medical bill if  he is entitled under the rules of the Institution allowing the  employees to claim reimbursement.  

For the reasons aforesaid, we do not find any merit in  this appeal excepting that the authority shall pay to the  appellant the salary for the period January 2002 to      March  2002 with all emoluments permissible under the service rules  of the employees of the Institution within three months of the  communication of this judgment, if not paid in the meantime.  Accordingly, the judgment of the Division Bench of the High  Court is hereby affirmed subject to the modifications made  herein earlier. The appeal is accordingly disposed of with no  order as to costs.