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PETITIONER: M.   D. SHUKLA & ORS.

       Vs.

RESPONDENT: STATE OF GUJARAT & ORS.

DATE OF JUDGMENT: 06/02/1970

BENCH: SHAH, J.C. BENCH: SHAH, J.C. HEGDE, K.S.

CITATION:  1971 AIR  117            1970 SCR  (3) 515  1970 SCC  (1) 419  CITATOR INFO :  R          1977 SC 747  (6)

ACT: States  Reorganisation  Act 37 of 1956 ss.  115,  116,  117- Bombay  Re-organisation  Act 11 of 1960, ss. 81,  82  &  83- Permanent employees of Saurashtra and Kutch States  allotted to  Bombay State after passing of Act 37 of 1956 but  posted in  districts  of Saurashtra and Kutch-Allotted  to  Gujarat State  after  passing  of  Act  11  of  1960-Transferred  to Secretariat--Government order regularising their services in Secretariat      and      fixing     their      pay      and seniority--Regularisation  whether amounted to  ’absorption’ within meaning of Bombay Allocated Government Servants’ (Ab- sorption.   Seniority, Pay and Allowances) Rules,,  1957,-R. 138 of Bombay Civil Services Classification and  Recruitment Rules,  1939  as amended’ in 1957 whether violated  by  such regularisation.

HEADNOTE: Prior  to  November  1, 1956  the  appellants  were  holding permanent   posts   in  the  ministerial  service   of   the Secretariats of the Part B State of Saurashtra and the  Part C  State  of  Kutch.   By  virtue of  s.  8  of  the  States Reorganisation Act 37 of 1956 the new State of Bombay  which included  the  territories of the States of  Saurashtra  and Kutch was formed.  Under s. 115(1) of the Act the appellants were allotted to serve in connection with the affairs of the new  State of Bombay.  BY the proviso to, s. 115(7)  it  was provided that ’conditions of service applicable  immediately before the appointed day to the case of any person  allotted to  another  State shall not be varied to  his  disadvantage except   with   the  previous  approval   of   the   Central Government’.   Section 116 provided for the  continuance  of officers in equivalent posts.  By s. 117 power was conferred upon  the  Central Government to give  directions  to  State Governments  for the purposes of ss. 114, 115 and 116.   The Act  authorised the Central Government to establish  one  or more  Advisory  Committees to advise the Government  on  the division  and integration of the services in the new  States and for ensuring fair and equitable treatment to all persons affected  by  the  provisions  of  s.  115  and  for  proper

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consideration  of any representation made by those  persons. A large majority of the members of the ministerial branch of the  Secretariats of the State of Saurashtra and Kutch  were unwilling  to be posted in the Secretariat of the new  State of  Bombay.   A  large majority out of  them  including  the appellants were accordingly posted in the districts of  the- former  States  of Saurashtra and Kutch.  Under  the  Bombay Reorganisation  Act  11 of 1960 the States  of  Gujarat  and Maharashtra  were  carved out of the territory  of  the  new State  of  Bombay.  Sections 81, 82 and 83 of the  1960  Act were  substantially the same as Ss. 115, 116 and 117 of  the 1956  Act.  The services of the appellants were under s.  81 of  the  Act  allotted to the  newly  constituted  State  of Gujarat.   The State of Gujarat transferred  the  appellants from the districts to the Secretariat.  After consulting the Public  Service Commission it issued on August 19,  1966  an order  "regularising"  the services of  the  appellants  and fixing  their  pay  and  seniority.   The  officers  of  the Secretariat  who  before  the, passing  of  the  said  order constituted the ministerial service filed a petition in  the High Court challenging its validity.  The High Court allowed the  petition mainly on two grounds, namely : (i)  that  the appellants were not absorbed-in the ministerial services  of the Secretariat within the meaning 516 of  the Bombay Allocated Servants’  (Absorption,  Seniority, Pay  and  Allowances) Rules, 1957; (ii) that r. 138  of  the Bombay Civil Services Classification and Recruitment  Rules, 1939   as  amended  in  1957  allowed  recruitment  to   the Ministerial Staff of the Secretariat by nomination after  an examination  or by promotion from the Lower Division and  it was  not open to the Government to adopt any  other  method. The High Court’s ,,decision was challenged in appeal  before this  Court.  The Court noted that no equivalence  had  been established  between the ,posts in the Secretariats  of  the States  of  Saurashtra and Kutch and the posts  in  the  new State of Bombay or later in Gujarat and that there had  been no  integration of the services by the  Central  Government. It  was  conceded before the Court that the  State  had  the authority to -transfer, subject to the Constitution and  the rules  made  under Art. 309, -any public servant  to  render service which by his training and aptitude he was  competent to do. HELD : (i) The fact that the expression ’absorption’ had not been  used  in  the impugned order  would  not  justify  the inference  that there was no intention to absorb the  former Saurashtra  and  Kutch State personnel in  the  Secretariat. [521 F] In  the absence of determination of equivalent  posts  under the  orders of the Central Government, the State of  Gujarat was  competent,  as a matter of provisional  arrangement  to absorb  the former Saurashtra and Kutch States personnel  in the  ministerial establishment of the Gujarat  State  Secre- tariat.   In  terms the order said that  the  persons  named therein "should be treated to have been regularly  appointed in  the posts shown against their names in column 4  of  the statement" appended to the order.  That clearly amounted  to absorption. [521 G-H] (ii) The  High Court was wrong in holding that the  impugned order  was  bad  because  it  contravened  r.  138  of   the Recruitment Rules. Assuming that r. 138 requires the State to follow a  certain method for recruitment to the ministerial service, that rule made under Art. 309 of the Constitution cannot take away the statutory  right  vested  in the  personnel  of  the  former

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Saurashtra  and  Kutch States which they acquired  under  s. 115(7) of the States Reorganisation Act, 1956 to hold  posts in  the new State which we-re equivalent and on terms  which were not, unless previous approval of the Central Government was obtained, disadvantageous.  Since the arrangement  which was  made  by  the Gujarat Government must  be  regarded  as provisional and to ensure so long as the Central  Government did  not  make  a final decision, it was  not  open  to  the officers  of "the Secretariat to challenge the authority  of the  Government of Gujarat either to transfer officers  from the  Districts  and to post and assign them  duties  in  the Secretariat  or  to fix their pay and  seniority  among  the officer  of the Secretariat performing ministerial  duties.’ [523 G-524 B] N.   Raghavendra  Rao v. Deputy Commissioner, South  Kanara, Mangalore,     [1964] 7 S.C.R. 549 and Union of India & Anr. v. P. K. Roy & Ors. [1968]    2 S.C.R. 186, applied.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 458 of 1969. Appeal from the judgment and order dated July 1, 1968 of the Gujarat, High Court in Special Civil Application No. 1499 of 1966. 517 M.   C. Chagla, S. K. Dholakia, Vineet Kumar and J. R. Nana- vati, for the appellants. S.   T. Desai, B. D. Sharma and S. P. Nayar, foe  respondent No. 1. S. S. Shukla, for respondents Nos. 2 to 148. The Judgment of the Court was delivered by Shah,  J. Certain officers in the ministerial branch of  the Secretariat Service of the State of Gujarat moved a petition in  the  High Court of Gujarat for an  order  directing  the State Government to treat its order dated August 19, 1966 as "illegal,  void  and  of  no effect"  and  to  forbear  from enforcing  its order treating the persons whose  names  were specified  in the annexure to the order as servants  of  the "Secretariat cadre".  The High Court of Gujarat granted  the petition  and  declared  the order dated  August  19,  1966, invalid.   With certificate granted by the High  Court  this appeal has been filed. Prior  to  November  1, 1956, the  appellants  were  holding permanent   posts   in  the  ministerial  service   of   the Secretariats of the Part B State of Saurashtra and the  Part C  State  of  Kutch.   By  virtue of  s.  8  of  the  States Reorganization Act 37 of 1956 the new State of Bombay, which included  the  territories of the States of  Saurashtra  and Kutch, was formed.  Section 115 of the States Reorganisation Act  made  provisions relating to services other  than  All- India  Services.   By sub-s. (1) of s. 115 it  was  enacted, inter  alia,  that every person who immediately  before  the appointed day was serving in connection, with the affairs of any of the existing States specified therein shall, as  from that  day,  be  deemed to have been  allotted  to  serve  in connection  with the affairs of the successor State to  that existing  State.   By  the  proviso to  sub-s.  (7)  it  was provided  that conditions of service applicable  immediately before the appointed day to the case of any person  allotted to  another  State shall not be varied to  his  disadvantage except with the previous approval of the Central Government. Section 116 provided for the continuance of officers in  the same posts.  By s. 117 power was conferred upon the  Central Government  to give directions to Any State Government  that

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may appear to be necessary for the purpose of giving  effect to -the provisions of ss.  114,115 and 116 of the Act. Under  the States Reorganisation Act, 1956,  the  appellants were allotted to serve in connection with the affairs of the new  State of Bombay.  In exercise of the powers under  Art. 309 of the Constitution, the Government of Bombay sanctioned certain  rules  called "The Allocated  Government  Servants’ (Absorption,  Seniority,  Pay &  Allowances)  Rules,  1957". Those  rules governed the servants who were allotted to  the State of Bombay on reorganisa- 518 tion.   A large majority of the members of  the  ministerial branch  of the Secretariat of the States of  Saurashtra  and Kutch  were,  it  appears, unwilling to  be  posted  in  the Secretariat   of  the  new  State  of  Bombay.   They   were accordingly posted in the districts of the former States  of Saurashtra and Kutch. Under Act 11 of 1960 called "The Bombay Reorganisation  Act" the States of Gujarat and Maharashtra were carved out of the territory  of  the  new  State  of  Bombay.   Under  s.   81 provisions  relating   to  services  other  than   All-India Services  were  made  and  by S. 82  provisions  as  to  the continuance  of officers in the same posts was made.  By  s. 83  power  was  given  to the  Central  Government  to  give directions  to the States.  Those provisions  were  substan- tially the same as the provisions of ss. 115, 116 and 117 of the  States Reorganisation Act, 1956.  The  appellants  were allotted  to  serve in connection with the  affairs  of  the State of Gujarat under s.     81      of     the      Bombay Reorganisation Act. The newly constituted State of Gujarat finding a dearth of experienced  officers  in the  Secretariat  transferred  the appellants  at ,diverse times between the years  1961,  1962 and  1963  to the Secretariat of the State  of  Gujarat  and ’assigned  them  duties in connection with  the  Secretariat Service.  Orders were issued from time to time fixing  their scales of pay and seniority.  Apparently the Public  Service Commission   raised  some  objections  about  an   attempted integration between the officers who were originally serving in  the Secretariat Service, and those who were posted  from the  districts.   Ultimately on August 19, 1966,  the  State Government issued the order to the following effect : "The  question  of regularising the appointment  to  various posts  in  the Secretariat Department on and after  1st  May 1960  of the drafted persons was under the consideration  of Government  for  some time.  Government is  now  pleased  to direct,  in  consultation with the  Gujarat  Public  Service Commission,  that  the  persons shown  in  the  accompanying statement should be treated to have been regularly appointed in  the posts shown against their names in column-4  of  the statement with effect from the date shown in column-5 in the Departments mentioned in column-3 of the statement. 2.   As  regards fixation of their pay and seniority  orders have  already been  issued in Government Resolution  General               Administration  Department  No.  SCT-  1161-F,               dated  25th April, 1961 and  Government  Reso-               lution  General Administration Department  No.               SCT1162-KH,   dated  14th  March  1964.    The               Departments are requested to fix their pay and               seniority accordingly." 519 Appended  to the order was a list of 90 persons  designating the  departments in which they were posted, posts  to  which appointed and the dates from which they were appointed. The  officers of the Secretariat who before the date of  the

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order  constituted  the ministerial service then  filed  the petition  out  of which this appeal arises  challenging  the validity  of the order of the Government.  The petition  was ,founded  on three grounds : (1) that the order violated  r. 138  of  the Recruitment Rules framed by the  Government  of Bombay  in 1957; (2) that the order violated the proviso  to cl.  (6)  of  s. 81 in that it  altered  the  conditions  of service  of  the applicants; and (3) that  it  violated  the provisions    of   the   Allocated   Government    Servants’ (Absorption, Seniority, Pay & Allowances) Rules, 1957. Counsel  for the applicants conceded before the  High  Court that the transfer of the former Saurashtra and Kutch  States Secretariat personnel to the Gujarat Secretariat per se  was not  open  to objection.  The High Court  did  not  consider whether   the  Saurashtra  and  Kutch   States   secretariat personnel  had "any rights flowing on account of  absorption and  integration of service under the States  Reorganisation Act,  1956  or the Allocated  Government  Servants’  Rules,, 1957." But the High Court held that since the impugned order purported  to  amalgamate the former  Saurashtra  and  Kutch States  personnel  with  the  Gujarat  Secretariat   Service contrary  to the terms of r. 138 of the  Recruitment  Rules, and  the Government had no authority to vary the  method  of recruitment  provided  by  the  statutory  r.  138  of   the Recruitment  Rules  which  was  mandatory,  the  orders   of transfer  to  the  Secretariat which was  not  made  in  the process of integration could not operate as absorption under the  Allocated Government Servants’ (Absorption,  Seniority, Pay & Allowances) Rules, 1957.  The High Court also observed that  when the ministerial service employees of  the  former Saurashtra  and Kutch States Secretariats were  absorbed  in the districts, integration of the services was complete  and any transfer thereafter to the Secretariat could not and did not -amount to absorption in equivalent posts. It is necessary first to examine the scheme of ss. 115 & 116 of  the  States Reorganisation Act, 1956.  Section  115  was intended  to  provide  for  the  conditions  of  service  of employees  who  immediately  before November  1,  1956  were serving  in connection with the affairs of a State and  were allotted to serve in connection with the affairs of  another State.  Power to fix the conditions of service was  reserved exclusively to the Central Government.  For that purpose the Central  Government was authorised to establish one or  more Advisory  Committees  to  ’advise  the  Government  on   the division  and integration of the services in the new  States and for ensuring fair and equitable treatment to all persons affected by the 520 provisions  of  S. 115 and for proper consideration  of  any representation  made  by those persons.  By the  proviso  to sub-s.  (7) S. 115 a guarantee was given to  every  allotted public  servant that his conditions of service shall not  be varied to his disadvantage except with the previous approval of  the  Central Government.  Section 116 provided  for  the continuance of officers in equivalent posts. This  Court  in N. Raghavendra Rao v.  Deputy  Commissioner, South  Kanara, -Mangalore(1) held that the effect of  sub-s. (7) of s. 115 is to preserve the power of the State to  make rules  under Art. 309 of the Constitution, but  the  proviso imposes  -a  limitation on the exercise of that  power;  the limitation  is that the State cannot vary the conditions  of service  applicable immediately before November 1, 1956,  to the  disadvantage of persons mentioned in sub-ss. (1) &  (2) of  s.  115.   In the view of the Court  the  broad  purpose underlying  the  proviso  to s. 115 (7) of the  Act  was  to

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ensure  that the conditions of service shall not be  changed except  with the prior approval of the  Central  Government, that  is,  before  embarking on varying  the  conditions  of service, the State Governments should obtain the concurrence of the Central Government. In Union of India & Anr. v. P. K. Roy & Ors. (2) this  Court held  that  it  is the duty of  the  Central  Government  to integrate  the  services,  but the State  may  be  asked  to prepare  a provisional gradation list provided. the  Central Government maintains its control over it. It  is  clear  that the  conditions  of  service  applicable immediately  before  the appointed day in the  case  of  any person who is allotted to another State cannot be varied  to his  disadvantage except with the previous approval  of  the Central Government.  This protection could not be removed by the rules made by the State subsequent to November -1, 1956, unless  the previous approval of the Central Government  was obtained thereto. It  is  true that the ministerial service personnel  in  the States of Saurashtra and Kutch, after they were allotted  to the  State  of  Bombay were posted and  assigned  duties  in various  districts  in  Saurashtra and Kutch.   But  in  the absence  of evidence to show that the previous  approval  of the  Central  Government  was obtained, their  right  to  be absorbed in equivalent posts in the new State of Bombay  and later in the State of Gujarat was not thereby affected.   It appears that there has riot been any equivalence established between  the  posts in the Secretariats. of  the  States  of Saurashtra  and  Kutch  and the posts in the  new  State  of Bombay  and:  later  in the State of Gujarat  to  which  the members  of the ministerial service of the  Secretariats  of former Saurashtra and Kutch States were allotted.  The  mere fact that they were posted (1) [1964] 7 S.C. R. 549. (2) [1968] 2 S. C. R. 186. 521 and  continued to render service in the Districts will  not, in  our  judgment, affect the right of the personnel  to  be absorbed  in the equivalent posts in the Secretariat and  on terms  not  disadvanta-geous  to  those  they  were  already entitled  except with the previous, approval of the  Central Government. It  was  conceded,  and  rightly, that  the  State  has  the authority  to transfer, subject to the Constitution and  the rules  made  under  Art. 309 any public  servant  to  render service which by his training and aptitude he was  competent to  do.   Transfer  of  the personnel  from  the  States  of Saurashtra  and  Kutch to the Secretariat in  the  State  of Gujarat   and  assignment  of  duties  performable  by   the ministerial  staff in the Secretariat cannot be  challenged, and  that because they were posted between 1956 and 1960  in the  Districts they will not be deprived of their  statutory right under s. 115(7) proviso.  Posting in the districts was and must remain purely provisional, until final  integration is made by the Central Government.  It is common ground that no  such  final  integration had been made  by  the  Central Government. Two grounds appealed to the High Court in deciding the case- against  the  appellants  : (1)  that  the  appellants  were transferred to the Secretariat of the State of Gujarat,  but they  were  not absorbed in the ministerial service  of  the Secretariat  of  the State of Gujarat.  In the view  of  the High   Court  there  was  merely  "regularisation"  of   the appointment  of those persons for the purpose of  performing service  in  the Secretariat; and (2) that the  order  dated

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August  19,.  1966 was-contrary to  the  Recruitment  Rules, 1957. If  it be granted that the State was competent ’to  transfer and  did  transfer  the appellants  to  perform  service  in connection with the affairs of the State in the Secretariat, it  is difficult to hold that when the  State  "regularised" the  service of the appellants in the Secretariat  with  the consent  of  the  Public Service  Commission  there  was  no absorption under the Absorption Rules.  It is true that  the expression "absorption" has not been used in the order,  but that  will  not  justify  an inference  that  there  was  no intention  to absorb the former Saurashtra and Kutch  States personnel   in   the  Secretariat.   In   the   absence   of determination  of equivalent posts under the orders  of  the Central Government, the State of Gujarat was competent, as a matter  of  provisional  arrangement to  absorb  the  former Saurashtra  and  Kutch States personnel in  the  ministerial establishment  of the Gujarat State  Secretariat.   In-terms the  order  says that the persons named therein  "should  be treated to have been regularly appointed in the posts  shown against  their names in column-4 of the statement"  appended to   the  order.   That,  in  our  judgment,   amounted   to absorption. 522 Original r. 138 of the Bombay Civil Services  Classification and  Recruitment Rules, 1939, was deleted and the  following rule was substituted on May 22, 1957.  The relevant part  of the rule reads "138.  The ministerial staff in the Secretariat and attached offices is divided into two Divisions. (a)  Upper; and (b) Lower. (i)  Superintendents  :  Appointments  shall  be  made   by- promotion from among Senior Assistants. (ii) Senior  Assistants  :  Appointments shall  be  made  by promotion from among Junior Assistants. (iii)     Junior  Assistants  : Appointments shall  be  made either : - (a)  by   nomination  on  the  results  of   a   competitive examination held by the Bombay Public Service Commission, or (b)  by promotion from among members of the Lower Division. Provided that ,not more than one out of every four vacancies in the posts of Junior Assistants shall ordinarily be filled by promotion. (2)  To   be  eligible  for  appointment  by  nomination   a candidate must (i)  hold  a  degree in Arts, law, science,  Agriculture  or commerce of a recognised University or possess an equivalent qualification; (ii) have attained the age of 18 years; and (iii)     not have -attained the age of 30 years in the case of   members  of  the  Lower  Division  appointed   on   the recommendation  of  the commission and  who  have  graduated while in service and in any other case 24 years on the first day  of the month immediately following month in  which  the posts are advertised by the Commission. B.   Lower Division (b)   Clerks, clerk-typists, typists : Appointments shall be made   by  nomination  on  the  results  of  a   competitive examination held by the Commission. 523 Provided  that  suitable members of Class  IV  services  who while  in  that service, have passed  the  Secondary  School Certificate  Examination  or an  examination  recognised  by Government  as  equivalent  to that  examination,  shall  be eligible   for  appointment  to  the  posts  of  clerks   by

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promotion. (2)  To  be  eligible  for  appointment  by  nomination,   a candidate must -.- (i)  have  passed  the  secondary  school  certificate  exa- mination  or  an  examination recognised  by  Government  as equivalent to that examination; (ii) have attained the age of 18 years; and (iii)     not have attained the age of 23 years on the first day  of the month immediately following the month  in  which the posts are advertised by the Commission. A  candidate  for the post of clerk-typist or  typist  must, also  be  able to type neatly and accurately  at  a  minimum speed of 40 words per minute. The  High  Court held that recruitment  to  the  ministerial staff  in the Secretariat could only be by nomination or  by promotion   from  among  members  of  the  Lower   Division, nomination being on the result of a competitive  examination held  by the Public Service Commission and  promotion  being from the subordinate staff.  In view of this rule, according to  the High Court, it was not open to the State  Government to  adopt any other method of recruitment of the members  of the ministerial staff. Counsel for the appellants contended that r. 138 only  dealt with   the  existing  servants  and  did  not  prevent   any additional members from being amalgamated in the ministerial staff  in  the  Secretariat.  He  also  contended  that  the recruitment  did not amount to admission of an  officer  for the  first time in the service.  It is unnecessary  for  the purpose of this appeal to consider these arguments.   Assum- ing  that  r.  138 requires the State to  follow  a  certain method for recruitment to the ministerial service, that rule made under Art. 309 of the Constitution cannot take away the statutory  right  vested  in the  personnel  of  the  former Saurashtra  and Kutch States which they acquired  under  the States  Reorganisation Act, 1956, to hold posts in the  ’new State  which  were equivalent and on terms which  were  not, unless the previous approval of the Central Government was 524 obtained,  disadvantageous.  Since the arrangement which  is made  by  the  Government of the State of  Gujarat  must  be regarded as provisional and to enure so long as the  Central Government does not make a final decision, it is not open to the  officers of the Secretariat to challenge the  authority of  the  Government of Gujarat either to  transfer  officers from the Districts and to post and assign them duties in the Secretariat  or  to fix their pay and  seniority  among  the officers in the Secretariat performing ministerial duties. The appeal must therefore be allowed and the order passed by the High Court must be set aside.  The petition filed by the respondents Nos. 2 to 148 will stand dismissed.  There  will be no order as to costs throughout. G.C. Appeal allowed. 525