REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO .2442   OF 2009 (Arising out of SLP (C) No.25505 of 2007)

M.P. State Co-op. Dairy Fedn. Ltd. & Anr. … Appellants

Versus

Rajnesh Kumar Jamindar & Ors. … Respondents

WITH

CIVIL APPEAL NOs. 2443,2446, 2447, 2449,  2452, 2454, 2456, 2458, 2460, 2462, 2464, 2467, 2469, 2471, 2472,  2473, 2474, 2475, 2477, 2478, 2480, 2481, 2482, 2483, 2484, 2485,  2486, 2487, 2489, 2494, 2495, 2496, 2497, 2498, 2499, 2500, 2502,  2503, 2504, 2505, 2506, 2507, 2508-2525, 2526, 2527, 2528, 2529,  

2530-2531, 2532, 2533   OF  2009   (Arising out of SLP (C) Nos.9, 11, 12, 20, 26, 52, 87, 184, 185, 202,  205, 249, 342, 345, 351, 353, 357, 386, 389, 396, 462, 585, 586,624,  692, 770, 779, 784, 804, 806, 816, 817, 825, 1360, 1716, 1772, 2205,  2208, 2211, 2235, 5123, 2249, 2478, 5102-5119, 6418, 6477, 6995,  7502, 4879-4880 of 2008, 24873 of 2007 and 17705 of 2008)

J U D G M E N T

S.B. Sinha, J.

1. Leave granted.

2. Whether  Madhya  Pradesh  State  Co-operative  Dairy  Federation  

Limited  (for  short  “the  Federation”)  is  a  ‘State’  within  the  meaning  of

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Article  12  of  the  Constitution  of  India  is  the  question  involved  in  these  

appeals.

3. Before us, there are 52 matters.  Out of 52 concerned employees, 16  

Writ Petitions were allowed by a learned Single Judge.  Writ appeals filed  

there against by the Federation were dismissed but only 50% back wages  

had been granted to the employees.  Respondents have not questioned the  

correctness  of  the  said  judgment.   Remaining  36  writ  petitions  were  

dismissed  by  a  learned Single  Judge.   However,  writ  appeals  filed  there  

against  have  been  allowed  directing  reinstatement  of  the  concerned  

respondents with only 20% back wages.   

4. Federation  is  a  society  registered  and  incorporated  under  the  

provisions  of  the  Madhya  Pradesh  Cooperative  Societies  Act,  1960  (for  

short “the Act”).  It is an apex society classified as a Central Society.  It is  

registered under Section 9 of the Act.  The Government of Madhya Pradesh  

through its Veterinary Department had been carrying out in certain areas of  

the State activities of supply of milk through its offices established for the  

said  purpose.  A  company  known  as  Madhya  Pradesh  State  Dairy  

Development Corporation Limited was incorporated on or about 22.03.1975  

for  carrying  out  the  business  of  sale  of  milk  and  its  products.  It  was

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registered  under  the  Indian  Companies  Act,  1956.  Its  object  was  

development  and  procurement  of  milk  and  for  bringing  out  a  ‘white  

revolution’.

5. Federation was constituted to promote sale of milk and its products  

inter  alia  with  a  view  to  providing  employment  to  agriculturists,  milk  

suppliers so as to enable it to implement a World Bank scheme effectively.  

The said company underwent voluntary winding up.  Its assets both movable  

and immovable were transferred to the Federation as part of shareholdings of  

the State Government.   

6. Federation is a federal society within the meaning of Section 2(k) of  

the Act.  It is also an apex society within the meaning of Section 2(a-1) of  

the Act.  It has its own bye-laws.  Bye-law No. 3 provides for betterment of  

the economic conditions of agriculturists and milk producers by monitoring  

the activities as also different programmes relating to production, collection,  

Processing,  distribution and marketing of  milk and milk products.   From  

time  to  time,  it  helps  and  provides  technical  assistance  to  the  primary  

societies, independent bodies which are engaged in the production of milk  

and its  proper  distribution in  urban areas.   It  also  issues  guidelines.   Its  

functions are enumerated in Bye-law Nos. 3.2.1 to 3.2.26.

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7. In terms of Section 55 of the Act, the Registrar framed regulations  

known  as  the  M.P.  State  Cooperative  Dairy  Federation  Ltd.  Employees  

Recruitment,  Classification  and  Conditions  of  Service  Regulations,  1985  

(for  short  “the  Regulations”).   Indisputably,  terms  and  conditions  of  

employment of the employees of the Federation are governed by the said  

Regulations; Regulation 13 whereof provides for compulsory retirement of  

an employee on attaining the age of 55 years or on completion of 25 years of  

service.  Regulation 13 was amended with effect from 24.12.2001 providing  

for compulsory retirement of an employee of the Federation on attaining the  

age of 50 years or completion of 20 years of service.  It reads as under:

“13. Compulsory Retirement

1. The appointing officer has the powers that  he  can  without  giving  any  reason  compulsory  retire  any  employee  on  completion  of  twenty  years  of  his  service  and  on  this  ground  any  claim  for  special  compensation  would  not  be  rejected,  however, this power would be exercised in  those  circumstances  when  the  appointing  officer is of the view that it is in the interest  of  the  Federation  and  it  can  be  done  by  giving 3 months prior intimation otherwise  not.

2. Any employee who has completed 20 years  of service at any time would be able to retire  from  the  Federation,  however,  before

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retiring  at  least  three  months  notice  in  writing  has  to  be  given  to  the  concerned  officer in this regard.  If he wants to retire  before  the  completion  of  the  period  of  notice,  then  he  would  be  paid  the  amount  equivalent  to  the  salary  and  allowances  which is less than three months.”

8. The said provision is at par with Rule 42(b) of the Madhya Pradesh  

Civil Service (Pension) Rules, 1976 applicable to the government servants.  

The said provision is also at par with the circular letter issued by the State  

Government on 22.08.2000.

9.   Indisputably,  pursuant  to or  in furtherance of  Regulation 13 of  the  

Regulations,  a  Scrutiny  Committee  as  also  a  Review  Committee  were  

constituted for the purpose of finding out as to how many employees can be  

compulsorily retired in terms thereof.

10. It  is  also  not  in  dispute  that  during  the  period  1975  to  1981,  no  

guideline  had  been  laid  down  in  regard  to  the  mode  and  manner  for  

recording of annual confidential reports.  Such parameters, however, were  

introduced in the year 1986-87.

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11.  Respondents  indisputably  have  completed  20  years  of  service.   A  

Scrutiny Committee constituted therefor scrutinized the service records of  

the respondents for about 20 years.  The formula for determination of the  

fitness  of  the  concerned  employees  to  continue  in  the  service  of  the  

Federation  was  the  same  which  is  made  applicable  to  the  case  of  the  

government  servants;  in  terms  whereof  the  entire  service  records  of  the  

employees  were  required  to  be  considered  wherefor  the  grading  in  the  

confidential reports was to be made on the following basis:

“For “Outstanding” category four marks, for “Very  Good” category three marks, for “Good” category  two marks, for “Average” category one mark, and  for “Poor” category zero marks has been allotted.  The total marks are to be divided by the number of  years  for  which  the  confidential  reports  are  available and which have been considered.   It  is  further  stated that  in case the average marks are  two or  more than two then the employee should  not be compulsorily retired and on the other hand  if he gets less than two average marks he should be  compulsorily retired.”

12. The  circular  letter  issued  by  the  Government  of  Madhya  Pradesh  

dated 22.08.2000 inter alia provides:

“(d) An evaluation  of  complete  service  records  should not be below ‘good’ Cagetory – B.  Simultaneously,  it  will  be  seen  whether

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there  is  any  decline  in  the  working  efficiency of the Government servant.  It is  to be seen whether the working efficiency,  especially  in  preceding  five  years  has  declined or not.”

Yet again, by a circular letter dated 20.03.2003, it was directed:

“Under  above  mentioned  subject  State  Government has decided accordingly :

(1) referred  memorandum  dated  12.12.2001  issued by this Department which was having  directions for drawing average marks on the  basis  of  service  period  by  showing  the  classification  marks  of  the  confidential  reports  of  the  government  employee  on  average basis for the purpose of screening, is  being hereby cancelled.

(2) The standards for screening that were fixed  by  the  referred  memorandum  dated  22.03.2000 in its para 2(1), now deleting its  standard No.4 following standards are now  being prescribed :

Standard No. (4)

(one) though at the time of screening whole record  of the employee should be checked, even then any  government  employee should not  be held retired  on the basis of normal disability, if his previous 5  years of service has been found satisfactory, or if  he has been promoted on some higher grade in last  5 years and his services on the higher grade have  been found satisfactory.

(two) any of the Government Employee, shall not  be retired from the service on the ground of normal

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disability,  if  within  one  year  of  the  date  of  screening he is going to be retired after completing  his  age  of  superannuation.   Abovesaid  condition  shall  not  be  applicable  in  cases  of  employees  having doubtful integrity.”

13. The report of the Scrutiny Committee was placed before the Review  

Committee, which in its report recorded:

“…During the course of examination, it  has also  been  observed  on  perusal  of  the  Confidential  Reports  that  in  some  Confidential  Reports  for  certain  years,  the  group/category  have  not  been  marked  but  the  marks  have  been awarded.   The  Confidential  Report  has  the  categories  of  ‘poor’  and ‘very poor’ while on the circular for evaluation  issued by the State, there being no category ‘very  poor’, the ‘very poor’ category has been treated as  ‘poor’,  ‘poor’  has  been  treated  as  ‘average’,  ‘average’  has  been  considered  as  ‘good’  and  ‘good’ has been considered as ‘very good’ for the  purpose of evaluation.

On making a review, following criteria have  been  prescribed  by  the  Government  for  the  purpose of compulsory retirement:-

1. Recommendations  may  be  made  after  considering  complete  records  of  the  employee for the purpose of his honesty and  integrity being in doubt.

2. Depletion in physical capacities.

3. An evaluation of the goodwill and working  efficiency of a Government servant may be  carried out on the basis of complete service  records of the Government servant.  It is not

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necessary  that  every  adverse  comment  and/or  such  comment  which  can  be  given  the nomenclature of adverse comment must  be communicated to the employees.

4. An all round evaluation of records of total  period of service :  must not below “good”  category.   Simultaneously,  it  may  also  be  seen that is there any decline in the working  efficiency  of  the  Government  servant.  Especially,  whether  there is  any decline in  the  working  efficiency  in  preceding  five  years,”

14. The  question  as  to  whether  the  Federation  is  a  ‘State’  within  the  

meaning  of  Article  12  of  the  Constitution  of  India  or  not  came  up  for  

consideration before a Full  Bench of the Madhya Pradesh High Court  in  

Dinesh Kumar Sharma v. M.P. Dugdh Mahasangh Sahakari Samiti Maryadit  

[1993 MPLJ 786].  Inter alia relying on or on the basis of the decisions of  

this Court in  Ajay Hasia v.  Khalid Mujib  Sehravardi [(1981) 1 SCC 722],  

Ramana Dayaram Shetty v. International Airport Authority of India [(1979)  

3 SCC 489] and Chander Mohan Khanna v. National Council of Educational  

Research and Training [(1991) 4 SCC 578 : AIR 1992 SC 76], it was held  

that the Federation is not a ‘State’, opining:

(i) The entire share capital is not held by the State Government.

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(ii) The entire expenditure of the cooperative societies is not met by  

the State Government.

(iii) It does not enjoy a monopoly status.

(iv) The State Government does not have any deep and pervasive  

control over the societies.   

It was, however, noticed that the Managing Director is appointed by  

the  State  Government but  the  Chairman of  the  Federation  has a  right  to  

contest election; its functions inter alia being to encourage the villagers, the  

persons  engaged  in  the  sale  of  milk  and  milk  products,  to  give  them  

employment, primarily resting on the cooperative principles which are not  

carried  out  pursuant  to  the  State  requirements  in  discharge  of  State’s  

obligations for health, safety or general welfare of public generally.

15. The matter, however, was referred to a Special Bench in  M.P. State  

Co-operative Dairy Federation and Others v. Madan Lal Chourasia [2007 (2)  

M.P.L.J.  594] for  reconsideration  of  the  said decision.   Speaking for  the  

Special Bench, consisting of five Hon’ble Judges, the Chief Justice of the  

High Court noticed that the six authoritative tests culled out in the case of  

Ajay Hasia (supra) having been reconsidered in  Pradeep Kumar Biswas v.

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Indian  Institute  of  Chemical  Biology [(2002)  5  SCC 111],  the  tests  laid  

down therein only were required to be considered, holding:

“…The  Federation  was  registered  as  a  Co- operative  Society  under  the  M.P.  Co-operative  Societies Act, 1960 on or about 13-5-1980. Bye- law 3.1 of  the Bye-laws of  the Federation states  that the main object of the Federation comprised of  conducting  various  programmes  of  manufacture,  collection, processing, distribution and sale of milk  and milk products for the economic development  of the farmers and for developing and safeguarding  the milk business, milk producing animals and for  the economic development of the groups engaged  in milk production and spreading and developing  other  joint  activities…the  main  object  of  the  Federation discussed above clearly show that the  work  of  the  Federation  relates  to  economic  development  of  farmers,  who  are  engaged  in  production and sale of milk in the State of Madhya  Pradesh and this work has been taken up by the  State  Government  through  the  agency  of  the  Federation because development of milk and milk  products  and  economic  development  of  farmers  carrying  the  business  of  sale  of  milk  and  milk  products  are  part  of  the  functions  of  a  welfare  State.”

It was found that the State Government and the Central Government  

were having more than 91% of shares in terms of Bye-laws 4.0, 4.9 and  

4.9.1.  It was noticed:

“17. Bye-law 2.2 of the bye-laws of the Federation  defines the Board of Directors of the Federation to

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mean the Board constituted, elected and nominated  under  the  bye-laws.  Bye-law  22  provides  for  composition  of  the  Board  of  Directors  and  the  Council for Federation.”

It noticed the composition of the Board of Directors of the Federation  

to hold:  

“It will be clear from the aforesaid composition of  the Board of Directors of the Federation that out of  13 members of the Board of Directors as many as  8  members  are  the  nominees  of  the  State  Government,  Central  Government  and  their  agencies. 18.  Under  bye-law  27  of  the  bye-laws  of  the  Federation,  vast  powers  have  been vested  in  the  Board of Directors of the Federation including the  power to appoint, dismiss, suspend and regularize  the  services  of  the  employees  of  the  Federation  such  as  Managers,  Secretaries,  Officers,  Clerks  and  to  fix  their  powers,  duties,  wages  and  allowances.  The  Board  of  Directors  of  the  Federation appear to have under the bye-laws of  the Federation over all administrative powers and  since  the  majority  of  the  Board of  Directors  are  nominees of the State Government and the Central  Government as representatives of their respective  departments  and not  as  experts  as  contended  by  Mr. Singh, we hold that the administrative control  of the Federation is with the Government. 19. Bye law 30 of the bye-laws of the Federation is  titled 'Managing Director' and bye-law 30.1 states  that for managing the business of the Federation,  Managing Director shall be appointed by the State  Government.  Bye  law  30.2  states  that  the  Managing  Director  of  the  Federation  shall  be  a  Chief Executive and will work under the control,  direction and guidance of the Board of Directors.

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Bye  law  30.3  of  the  bye-laws  states  that  the  Managing Director shall execute the business and  work  as  per  powers  given  to  him,  from time to  time,  by  the  Board  of  Directors  and  he  can  delegate  his  powers  given  by  the  Board  of  Directors  to  his  subordinate  officers  and he  will  place the information of delegation of his powers  to subordinate officers in the next meeting of the  Board of  Directors.  It  will  thus be clear that the  Managing  Director  is  not  only  appointed  by  the  State  Government  but  is  also  under  the  control,  direction and guidance of the Board of Directors,  which is dominated by the Government nominee.  Hence, day to day functioning of the Federation is  also  controlled  by  the  Government  though  the  Managing Director and the Board of Directors of  the Federation…”

It was furthermore noticed:

“20. Bye law 17 of the bye-laws is titled 'General  Assembly' and bye law 17.1 states that the General  Assembly  of  the  Federation  will  have  the  supremacy  under  the  Act,  Rules  and  Bye-laws.  Bye  law 17.2  deals  with  the  composition  of  the  General Assembly and says that it will comprise of  elected  members  of  the  Milk  Union  and  all  the  nominated  members  of  Board  of  Directors.  Bye  law  17.3  states  that  the  Federation  will  call  a  General  Assembly  every  year,  which  will  be  before three months of  the end of financial  year  and bye law 17.4 states that the Federation can at  any  time  call  a  General  Assembly  to  discuss  emergency  work.  Bye  law  18  states  that  the  General  Assembly  will  consider  the  subjects  mentioned therein and these are mainly the budget  and  programme  presented  by  the  Board  of  Directors, the annual financial report placed by the

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Board  of  Directors  of  the  Federation,  the  distribution  of  profits  and  decision  on  the  audit  application and audit removal report of the Board  of  Directors.  These  provisions  relating  to  the  General Assembly of the Federation show that the  General  Assembly  was  also  dominated  by  the  Board of Directors.  As the Board of Directors is  dominated by the nominees of the Government, the  General  Assembly  will  also take decisions in  its  meeting  in  the  manner  as  desired  by  the  Government.  Hence,  the  Federation  is  also  dominated  and  controlled  by  the  Government  administratively and functionally as in the cases of  Pradeep  Kumar  Biswas  and  Virendra  Kumar  Srivastava (supra).”

On the aforementioned  findings,  the  decision of  the Full  Bench in  

Dinesh Kumar Sharma (supra) was overruled.

16. Mr.  C.N.  Sreekumar,  learned  counsel  appearing  on  behalf  of  the  

Federation, in support of the appeals, would contend:

(i) The Special Bench of the High Court committed a serious error in  

refusing to consider the authoritative pronouncement of this Court  

in Ajay Hasia (supra) as also its earlier decision in Dinesh Kumar  

Sharma (supra) to hold that the Federation is a ‘State’ within the  

meaning of Article 12 of the Constitution of India.

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(ii) The  Federation  having  been  running  into  huge  losses,  the  

conditions  precedent  for  retirement  of  the  employees  of  the  

Federation as contained in Regulation 13 of the Regulations having  

been satisfied, the impugned judgment cannot be sustained.   

17. Mr. Vivek K. Tankha, learned senior counsel appearing on behalf of  

contesting respondents and Ms. Pragati Neekhra, learned counsel appearing  

on behalf of the appellant in Civil Appeal arising out of SLP (C) No. 17705  

of 2008, on the other hand, would urge:

(i) The share capital, functional control and the administrative control  

being completely in the hands of the Government of the State, the  

Federation  is  a  ‘State’  within  the  meaning of  Article  12  of  the  

Constitution of India.

(ii) As the decision of this  Court in  Pradeep Kumar Biswas (supra)  

governs the field and the criteria laid down therein being satisfied,  

no exception can be taken to the impugned judgment.

(iii) Regulations governing the conditions of service being statutory in  

character  and  the  Federation,  having  adopted  the  government  

circulars and rules for the purpose of implementation of its policy

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to retire compulsorily a large number of employees, were bound to  

follow the same.

(iv) The Scrutiny Committee  and the Review Committee  having not  

only consisted of the officers of the State but also the Registrar of  

the Cooperative Societies, it was futile to move to the Registrar of  

the Cooperative Societies for setting aside the impugned circulars  

issued with regard to compulsory retirement.

(v) Having  regard  to  the  Regulations  governing  payment  of  back  

wages,  as contained in Regulation 49(2) of the Regulations,  the  

entire back wages should be directed to be paid.

18. An additional contention has been raised in the Civil Appeal arising  

out of SLP (C) No. 17705 of 2008 that the appellant therein having been  

suffering from disability within the meaning of the provisions of the Persons  

with  Disabilities  (Equal  Opportunities,  Protection  of  Rights  and  Full  

Participation) Act, 1995 (for short “the 1995 Act”), Section 47 thereof would  

be attracted and, thus, the appellant was entitled to entire back wages.

19. Article 12 of the Constitution of India reads as under:

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“12. Definition.—In this part, unless the context  otherwise  requires,  ‘the  State’  includes  the  Government  and  Parliament  of  India  and  the  Government  and  the  legislature  of  each  of  the  States and all local or other authorities within the  territory  of  India  or  under  the  control  of  the  Government of India.”

20. The  development  of  law  in  this  regard  in  view  of  the  decisions  

rendered by this Court beginning from the Rajasthan State Electricity Board  

v.  Mohan Lal [(1967) 3 SCR 377],  Ajay Hasia (supra) and other decisions  

including a Seven – Judge Bench decision of this Court in Pradeep Kumar  

Biswas (supra), is to say the least phenomenal.

21. We may also notice that P.K.   Ramachandra Iyer and Others   v. Union  

of  India  and  Others [(1984)  2  SCC  141]  wherein  Indian  Council  for  

Agricultural Research (ICAR) was held to be a ‘State’ within the meaning of  

Article 12 of the Constitution of India, was distinguished in Chander Mohan  

Khanna (supra).  However,  Chander Mohan Khanna (supra) was overruled  

in  Pradeep Kumar Biswas (supra) to the extent it followed the decision in  

Sabhajit Tewary v. Union of India [(1975) 1 SCC 485].

22. In  Mysore  Paper  Mills  Ltd. v.  Mysore  Paper  Mills  Officers’  

Association and Another [(2002) 2 SCC 167] Mysore Paper Mills Ltd. was

18

held to be a ‘State’ within the meaning of Article 12 of the Constitution of  

India as  it  was substantially  financed and controlled by the  Government,  

managed by the Board of Directors nominated and removable at the instance  

of  the Government  and carrying on functions of  public  interest  under its  

control.

23.  In Pradeep Kumar Biswas (supra), the following tests have been laid  

down by a Seven-Judge Bench of this Court:

(i) Formation of the body

(ii) Objects and functions

(iii) Management and control

(iv) Financial aid, etc.

The dicta of Mathew, J. in Sukhdev Singh v. Bhagatram Sardar Singh  

Raghuvanshi [(1975) 1 SCC 421] was quoted with approval therein is in the  

following terms:

“17.  For  identifying  such  an  agency  or  instrumentality he propounded four indicia: (1) “A finding of the State financial support plus  an unusual degree of control over the management  and  policies  might  lead  one  to  characterize  an  operation as State action.” (SCC p. 454, para 96)

19

(2) “Another factor which might be considered is  whether  the  operation  is  an  important  public  function.” (SCC p. 454, para 97) (3)  “The  combination  of  State  aid  and  the  furnishing  of  an  important  public  service  may  result in a conclusion that the operation should be  classified as a State agency. If a given function is  of such public importance and so closely related to  governmental  functions  as  to  be  classified  as  a  governmental  agency,  then  even  the  presence  or  absence of State financial aid might be irrelevant  in making a finding of State action. If the function  does not fall within such a description, then mere  addition of State money would not influence the  conclusion.” (SCC p. 454, para 97) (4)  “The ultimate  question  which is  relevant  for  our  purpose  is  whether  such  a  corporation  is  an  agency or  instrumentality of the Government for  carrying on a business for the benefit of the public.  In other words, the question is, for whose benefit  was  the  corporation  carrying  on  the  business?”  (SCC p. 458, para 111)”

This Court referred to  Ajay  Hasia (supra) wherein the tests gathered  

from the decision of this  Court  in  Ramana Dayaram Shetty (supra)  were  

stated in the following terms:

“(1)  One  thing  is  clear  that  if  the  entire  share  capital of the corporation is held by Government, it  would go a long way towards indicating that the  corporation  is  an  instrumentality  or  agency  of  Government. (SCC p. 507, para 14) (2) Where the financial assistance of the State is so  much as to meet almost entire expenditure of the  corporation, it would afford some indication of the

20

corporation being impregnated with Governmental  character. (SCC p. 508, para 15) (3) It may also be a relevant factor ... whether the  corporation enjoys monopoly status which is State  conferred or State protected. (SCC p. 508, para 15) (4) Existence of deep and pervasive State control  may afford an indication that the corporation is a  State agency or instrumentality. (SCC p. 508, para  15) (5) If the functions of the corporation are of public  importance  and  closely  related  to  Governmental  functions,  it  would  be  a  relevant  factor  in  classifying the corporation as an instrumentality or  agency of Government. (SCC p. 509, para 16) (6) ‘Specifically, if a department of Government is  transferred to a corporation, it would be a strong  factor  supportive  of  this  inference’  of  the  corporation being an instrumentality or agency of  Government.” (SCC p. 510, para 18)”

It was held in Pradeep Kumar Biswas (supra):

“40. The picture that ultimately emerges is that the  tests formulated in Ajay Hasia are not a rigid set of  principles so that if a body falls within any one of  them it must, ex hypothesi, be considered to be a  State  within  the  meaning  of  Article  12.  The  question in each case would be — whether in the  light  of  the  cumulative  facts  as  established,  the  body  is  financially,  functionally  and  administratively dominated by or under the control  of  the  Government.  Such  control  must  be  particular  to  the  body  in  question  and  must  be  pervasive. If this is found then the body is a State  within  Article  12.  On  the  other  hand,  when  the  control is merely regulatory whether under statute  or otherwise, it would not serve to make the body a  State.”

21

24. In  Virendra  Kumar  Srivastava v.  U.P.  Rajya  Karmachari  Kalyan  

Nigam and Another [(2005)  1  SCC 149],  this  Court  held the respondent  

therein to be a ‘State’ within the meaning of Article 12 of the Constitution of  

India,  applying  the  tests  of  administrative  control,  financial  control  and  

functional control.

25. The question as to whether the Board of Control for Cricket in India  

(BCCI) which is a private body but had a control over the sport of cricket in  

India is a ‘State’ within the meaning of Article 12 of the Constitution of  

India came up for consideration before a Constitution Bench of this Court in  

Zee Telefilms Ltd. and Another v. Union of India and Others [(2005) 4 SCC  

649]  wherein  the  majority  felt  bound by the  dicta  laid  down in  Pradeep  

Kumar Biswas (supra) to opine that it was not a ‘State’ within the meaning  

of Article 12 of the Constitution of India.

However, the minority noticed:

“70.  Broadly,  there  are  three  different  concepts  which  exist  for  determining  the  questions  which  fall within the expression “other authorities”: (i)  The corporations  and the societies  created by  the  State  for  carrying  on its  trading activities  in  terms of Article 298 of the Constitution wherefor  the  capital,  infrastructure,  initial  investment  and

22

financial aid, etc. are provided by the State and it  also exercises regulation and control thereover.  (ii)  Bodies  created  for  research  and  other  developmental  works  which  are  otherwise  governmental functions but may or may not be a  part of the sovereign function. (iii) A private body is allowed to discharge public  duty  or  positive  obligation  of  public  nature  and  furthermore is allowed to perform regulatory and  controlling  functions  and  activities  which  were  otherwise the job of the Government.

71. There cannot be same standard or yardstick for  judging  different  bodies  for  the  purpose  of  ascertaining as to whether any of them fulfils the  requirements of law therefor or not.

80. The concept that all public sector undertakings  incorporated  under  the  Companies  Act  or  the  Societies  Registration  Act  or  any  other  Act  for  answering  the  description  of  State  must  be  financed by the Central Government and be under  its deep and pervasive control has in the past three  decades undergone a sea change. The thrust now is  not  upon  the  composition  of  the  body  but  the  duties and functions performed by it. The primary  question which is required to be posed is whether  the body in question exercises public function.

110. Tests evolved by the courts have, thus, been  expanded  from time  to  time  and  applied  having  regard to the factual matrix obtaining in each case.  Development in this branch of law as in others has  always found differences. Development of law had  never been an easy task and probably would never  be.”

The majority  despite  holding that BCCI is  not a ‘State’  within the  

meaning of Article 12 of the Constitution of India opined that a writ petition

23

under Article 226 of the Constitution of India would be maintainable against  

it.

26. In  State of U.P. v.  Neeraj Awasthi and Others [(2006) 1 SCC 667],  

U.P. State Agricultural Produce Market Board has been held to be a ‘State’,  

holding:

“33. The Board is “State” within the meaning of  Article 12 of the Constitution. It was constituted in  terms  of  the  provisions  of  the  said  Act.  As  the  powers and functions of the Board as also the State  in  terms  of  the  provisions  of  the  statute  having  been  delineated,  they  must  act  strictly  in  terms  thereof.  It  is  a  statutory  authority.  Its  powers,  duties and functions are governed by the statute. It  is  responsible  for  constitution  of  the  Market  Committees  for  the  purpose  of  overseeing  that  agriculturists  while  selling  their  agricultural  produce receive the just price therefor. It not only  regulates  sale  and  purchase  of  the  agricultural  produce but also controls the markets where such  agricultural  produces  are  bought  and  sold.  The  Board is entitled to levy market fee and recover the  same from the buyers and sellers through Market  Committees. Indisputably, the Market Committees  and the Board have power to appoint officers and  servants. Although the power of the Board in this  respect  is  not  circumscribed,  that  of  the  Market  Committees  is.  The  Market  Committees  can  appoint only such number of secretaries and other  officers as may be necessary for efficient discharge  of  its  functions.  Terms  and  conditions  of  such  services are to be provided by it. Section 19 of the  Act,  however,  imposes  further  restriction  on  the  power  of  the  Market  Committee  by  limiting  the

24

annual  expenditure  made  in  this  regard  not  exceeding 10% of the total  annual receipt  of the  Committee.”

27. In  S.S.  Rana v.  Registrar,  Coop. Societies  and Another [(2006) 11  

SCC 634], Pradeep Kumar Biswas (supra) has been followed.

28. We have noticed the history of the Federation.  It was a part of the  

Department of the Government.  It not only carries on commercial activities,  

it works for achieving the better economic development of a section of the  

people.  It  seeks to achieve the principles laid down in Article 47 of the  

Constitution  of  India,  viz.,  nutritional  value  and health.   It  undertakes  a  

training  and  research  work.   Guidelines  issued  by  it  are  binding  on  the  

societies.  It monitors the functioning of the societies under it.  It is an apex  

body.

29. We, therefore, are of the opinion that the appellant herein would come  

within the purview of the definition of ‘State’ as contained in Article 12 of  

the Constitution of India.

30. The learned Single Judge called for the records.  It was found that the  

Regulations were amended in conformity with the government circulars and,

25

thus, the said amendment was valid.  It was noticed that at least in cases of  

16 employees, the average grading being “good”, their services could not  

have been dispensed with.   

31. The  Division  Bench  of  the  High  Court,  furthermore,  noticed  that  

although in many cases, the ACRs were not available but an attempt had  

been made to grant “average” on the basis of the year.  It was furthermore  

found that although the Scrutiny Committee was required to lay emphasis on  

the grading of last five years, there was no justification why the last two  

years’ grading had not been taken into consideration.  It was furthermore  

held  that  the  process  of  weeding  out  does  not  satisfy  the  test  of  

rationalization, stating:

“(a) There has been no rationalization of marking  system  when  conversion  has  taken  place  from  grading  to  award  of  marks  by  the  Screening Committee.

(b) The  principle  of  average  that  has  been  applied by the Screening Committee is not  an  acceptable  one  as  the  best  average  principle  should  have  ordinarily  been  applied in the absence of non-availability of  the ACR, for the ACRs are maintained and  kept by the employer.

26

(c) There  was no justification  to  fix  a  cut  off  date when the Screening Committee met at a  later stage.

(d) Though the Circular postulates that last five  years  ACRs  have  to  be  taken  into  consideration for the purpose of finding out  whether there has been declining of progress  in the performance of the employee the last  two years ACRs were not considered.

(e) In certain cases benefit  of  promotion were  conferred  by  the  said  facet  has  not  been  taken into consideration at all which reflects  non-application of mind.”

It was, however, opined that back wages to the employees should be  

confined to 20%.

32. The  law relating  to  compulsory  retirement  in  public  interest  is  no  

longer res integra.  The provisions had been made principally for weeding  

out dead wood.  An order of compulsory retirement being not penal in nature  

can be subject to judicial review inter alia:

(i) When it is based on no material;

(ii) When it is arbitrary;

(iii) When it is without application of mind; and  

(iv) When there is no evidence in support of the case.

27

In Baikuntha Nath Das and Another v. Chief District Medical Officer,  

Baripada and Another [(1992) 2 SCC 299], this Court held:

“34.  The  following  principles  emerge  from  the  above discussion:

(i) An order of compulsory retirement is  not  a  punishment.  It  implies  no  stigma  nor  any  suggestion of misbehaviour.

(ii) The  order  has  to  be  passed  by  the  government on forming the opinion that it is in the  public  interest  to  retire  a  government  servant  compulsorily. The order is passed on the subjective  satisfaction of the government.

(iii) Principles  of  natural  justice  have  no  place  in  the  context  of  an  order  of  compulsory  retirement.  This  does  not  mean  that  judicial  scrutiny  is  excluded  altogether.  While  the  High  Court or this Court would not examine the matter  as an appellate court, they may interfere if they are  satisfied that the order is passed (a) mala fide or  (b) that it is based on no evidence or (c) that it is  arbitrary — in the sense that no reasonable person  would  form  the  requisite  opinion  on  the  given  material;  in short,  if  it  is found to be a perverse  order.

(iv) The  government  (or  the  Review  Committee,  as  the  case  may  be)  shall  have  to  consider the entire record of service before taking  a  decision  in  the  matter  —  of  course  attaching  more  importance  to  record  of  and  performance  during  the  later  years.  The  record  to  be  so  considered would naturally  include the entries in  the  confidential  records/character  rolls,  both  favourable and adverse. If a government servant is  promoted  to  a  higher  post  notwithstanding  the  adverse  remarks,  such  remarks  lose  their  sting,  more  so,  if  the  promotion  is  based  upon  merit  (selection) and not upon seniority.

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(v) An order of compulsory retirement is  not liable to be quashed by a Court merely on the  showing  that  while  passing  it  uncommunicated  adverse  remarks  were  also  taken  into  consideration.  That circumstance by itself  cannot  be a basis for interference.”

In  State of Gujarat v.  Umedbhai M. Patel [(2001) 3 SCC 314], this  

Court held:

“11. The law relating to compulsory retirement has  now  crystallised  into  definite  principles,  which  could be broadly summarised thus: (i) Whenever the services of a public servant are  no longer useful to the general administration, the  officer can be compulsorily retired for the sake of  public interest. (ii) Ordinarily, the order of compulsory retirement  is not to be treated as a punishment coming under  Article 311 of the Constitution. (iii)  For  better  administration,  it  is  necessary  to  chop off dead wood, but the order of compulsory  retirement can be passed after having due regard to  the entire service record of the officer. (iv) Any adverse entries made in the confidential  record  shall  be  taken  note  of  and  be  given  due  weightage in passing such order. (v)  Even  uncommunicated  entries  in  the  confidential  record  can  also  be  taken  into  consideration. (vi) The order of compulsory retirement shall not  be  passed  as  a  short  cut  to  avoid  departmental  enquiry when such course is more desirable. (vii) If the officer was given a promotion despite  adverse  entries  made  in  the  confidential  record,  that is a fact in favour of the officer.

29

(viii) Compulsory retirement shall not be imposed  as a punitive measure.”

In  Pritam Singh v.  Union of India & Ors. [(2005) 9 SCC 748], this  

Court held:

“13. In our opinion, the High Court has committed  an error in not interfering with the punishment of  compulsory retirement  even though the appellant  submitted that the misconduct alleged against him  was not at all an offence or even a serious mistake.  The act of misconduct alleged against him was that  he supplied a list of absentee details to one of the  employees,  who  was  fighting  a  case  before  the  Tribunal against the Railways. This list contained  the ticket numbers of the workers of a shop, who  were  absent  on  that  date.  This  was  neither  a  confidential document nor a privileged document.  It  contained  details  to  which  the  employee  concerned  had  a  right  of  information.  The  appellant being a Superintendent Grade II and in  charge of the information acted bona fide in good  faith  while  supplying  the  information.  In  our  opinion,  this  kind  of  an  act  was  neither  a  misconduct  nor  a  serious  mistake.  When  the  charges were found proved against the appellant,  the  appellant  admitted  that  he  had  supplied  the  absentee details.

*** *** *** 16. This Court in the case of Union of India v. G.  Ganayutham while examining the scope of judicial  review  held  that  “reasonableness”,  “rationality”  and “proportionality” are the grounds on the basis  of  which  judicial  review  of  the  administrative  order  can  be  undertaken.  Considering  the  facts  extracted hereinbefore, we find that the exercise of

30

power by the respondent  falls in the category of  arbitrary exercise of power.”

33. Before  us,  like  before  the  learned  Single  Judge  and  the  Division  

Bench of the High Court, various discrepancies in the report of the Scrutiny  

Committee as approved by the Review Committee were pointed out.  The  

examples  placed  before  us  clearly  demonstrate  that  neither  the  Scrutiny  

Committee nor the Review Committee took into consideration the relevant  

factors germane for the purpose of passing such an order and in fact had  

taken into consideration irrelevant factors which were not germane therefor.  

34. Some of the employees, for a number of years, had been shown to be  

good officers; ACRs of some of whom in some of the years have been “very  

good”.  As has been noticed hereinbefore, the Scrutiny Committee as also  

the Review Committee proceeded to determine each individual case keeping  

in view the ACRs of the employees concerned from 1980, since when the  

Federation had started functioning, to the year 2000, when the decision had  

been  taken  to  compulsorily  retire  the  employees,  by  amending  the  

Regulations.  We have noticed hereinbefore that although criteria adopted by  

the State were required to be considered for the purpose of determining the  

suitability or otherwise of the employees to continue in service, the necessity

31

to give special consideration to the performance of the employees for the last  

five years before the order was passed had been given a complete go-by.  

The  learned  Single  Judge  as  also  the  Division  Bench,  as  noticed  

hereinbefore,  clearly  held  that  for  the  purpose  of  weeding  out  the  dead  

wood, it was absolutely necessary to take into consideration the performance  

of each of the employees at least for the last two years.

35. Each case, thus, was required to be considered on its own merit.  The  

broad  criteria,  which  are  not  only  applicable  generally  for  the  

aforementioned purpose, were required to be followed but there cannot be  

any doubt or dispute that the criteria laid down by the State was imperative  

in character.  Thus, the Federation adopted the rules and circulars made or  

issued by the State Government.  The Federation itself having formulated  

the  criteria  required  to  be  applied  for  passing  orders  of  compulsory  

retirement was, thus, bound thereby.  It is now a well-settled principle of law  

that the employer would be bound by the rule of game.  It must follow the  

standard laid down by itself.  If procedures have been laid down for arriving  

at some kinds of decisions, the same should substantially be complied with  

even if the same are directory in nature.  

32

36. This  rule  was enunciated by Mr.  Justice  Frankfurter  in  Vitarelli v.  

Seaton [359 US 535],  wherein the learned Judge said:  

‘An executive agency must be rigorously held to  the standards by which it professes its action to be  judged.  …  Accordingly,  if  dismissal  from  employment is based on a defined procedure, even  though generous beyond the requirements that bind  such agency, that procedure must be scrupulously  observed.  …  This  judicially  evolved  rule  of  administrative law is now firmly established and, if  I may add, rightly so. He that takes the procedural  sword shall perish with that sword.’ ”

[See  also  H.V.  Nirmala v.  Karnataka  State  Financial  Corporation  

(2008) 7 SCC 639]

37. The power of judicial review of a superior court although a restricted  

one, has many facets.  Its jurisdiction is not only limited in the cases where  

the administrative orders are perverse or arbitrary but also in the cases where  

a statutory authority has failed to perform its statutory duty in accordance  

with law.  An order which is passed for unauthorized purpose would attract  

the principles of malice in law.  [See Managaer, Government Branch Press  

and Another v. D.B. Belliappa (1979) 1 SCC 477 : AIR 1979 SC 429, Smt.  

S.R. Venkataraman v. Union of India and Another (1979) 2 SCC 491 : AIR  

1979 SC 49 and P. Mohanan Pillai v.  State of Kerala and Others (2007) 9  

SCC 497]

33

38. It  is  a  well-settled  principle  of  law  that  an  order  of  compulsory  

retirement is found to be stigmatic inter alia, in the event the employer has  

lost  confidence  [See  Chandu  Lal v.  Management  of  M/s.  Pan  American  

World Airways Inc. (1985) 2 SCC 727 at 730, para 8], or he has concealed  

his  earlier  record  [See  Jagdish Parsad v.  Sachiv,  Zila  Ganna Committee,  

Muzaffarnagar and Another (1986) 2 SCC 338 at 342-343, para 9].

He can, however, be subjected to compulsory retirement inter alia if  

he has  outlived his  utility  [The State  of  Uttar  Pradesh v.  Madan Mohan  

Nagar, AIR 1967 SC 1260 at 1262].

In  Allahabad Bank Officers’ Association and Another v.  Allahabad  

Bank and Others [(1996) 4 SCC 504], it was held:

“17. The above discussion of case-law makes it  clear  that  if  the  order  of  compulsory  retirement  casts  a  stigma on the  government servant  in  the  sense that it contains a statement casting aspersion  on  his  conduct  or  character,  then  the  court  will  treat  that  order  as  an  order  of  punishment,  attracting  provisions  of  Article  311(2)  of  the  Constitution.  The  reason  is  that  as  a  charge  or  imputation is  made the condition for passing the  order, the court would infer therefrom that the real  intention  of  the  Government  was  to  punish  the

34

government servant on the basis of that charge or  imputation  and  not  to  exercise  the  power  of  compulsory retirement. But mere reference to the  rule, even if it  mentions grounds for compulsory  retirement,  cannot  be  regarded  as  sufficient  for  treating the order of compulsory retirement as an  order of punishment. In such a case, the order can  be said to have been passed in terms of the rule  and,  therefore,  a  different  intention  cannot  be  inferred.  So  also,  if  the  statement  in  the  order  refers only to the assessment of his work and does  not  at  the  same  time  cast  an  aspersion  on  the  conduct  or  character  of  the  government  servant,  then it will not be proper to hold that the order of  compulsory  retirement  is  in  reality  an  order  of  punishment. Whether the statement in the order is  stigmatic or not will have to be judged by adopting  the test of how a reasonable person would read or  understand it.”

The question came up for consideration before a Division Bench of  

this Court in  State of Gujarat v.  Umedbhai M. Patel [(2001) 3 SCC 314]  

wherein Balakrishnan, J., as the learned Chief Justice then was, summarized  

the law, thus:

“11. The law relating to compulsory retirement has  now  crystallised  into  definite  principles,  which  could be broadly summarised thus: (i) Whenever the services of a public servant are  no longer useful to the general administration, the  officer can be compulsorily retired for the sake of  public interest.

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(ii) Ordinarily, the order of compulsory retirement  is not to be treated as a punishment coming under  Article 311 of the Constitution. (iii)  For  better  administration,  it  is  necessary  to  chop off dead wood, but the order of compulsory  retirement can be passed after having due regard to  the entire service record of the officer. (iv) Any adverse entries made in the confidential  record  shall  be  taken  note  of  and  be  given  due  weightage in passing such order. (v)  Even  uncommunicated  entries  in  the  confidential  record  can  also  be  taken  into  consideration. (vi) The order of compulsory retirement shall not  be  passed  as  a  short  cut  to  avoid  departmental  enquiry when such course is more desirable. (vii) If the officer was given a promotion despite  adverse  entries  made  in  the  confidential  record,  that is a fact in favour of the officer. (viii) Compulsory retirement shall not be imposed  as a punitive measure.”

39. It is also a well-settled principle of law that an authority discharging a  

public function must act fairly.  It, for the aforementioned purpose, cannot  

take  into  consideration  an  irrelevant  or  extraneous  matter  which  is  not  

germane for the purpose for which the power is sought to be exercised.  The  

Scrutiny Committee  as  also the Review Committee  was required to pose  

unto themselves a correct question of law so as to enable them to find out a  

correct answer.  It was, therefore, imperative that the criteria laid down in

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the  circulars  issued  by  the  State  of  Madhya  Pradesh  should  have  been  

scrupulously followed.   

40. Federation,  therefore,  in our opinion, having regard to the fact  that  

there was no material to show that the respondents – employees had become  

dead wood, inefficient or corrupt, must be held to have abused its power.

41. ‘Interest  of  the  Federation’  as  contained  in  Regulation  13  of  the  

Regulations would not mean that services of a large number of employees  

should  be  dispensed  with  only  for  the  purpose  of  cutting  administrative  

expenses.  Even such a power does not exist in terms of the Regulations nor  

any such ground had been taken in the counter-affidavit  before the High  

Court.   

42. Strong  reliance  has  been  placed  by  Mr.  Sreekumar  on  a  recent  

decision of this Court in Mundrika Dubey and Others v. State of Bihar and  

Others [(2008) 4 SCC 458] wherein orders of compulsory retirement by way  

of  an  economic  measure  had  been  found  to  be  in  the  interest  of  the  

employer.  

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43. It may be placed on record that neither there exist any such provision  

nor such a stand had been taken before the High Court.  Furthermore, it is  

well-settled that while a power is exercised by an authority, ordinarily, the  

reasons  contained  in  the  order  should  be  supported  by  the  materials  on  

records.   

44. Submission of Mr. Sreekumar, that the High Court should not have  

interfered with the order of compulsory retirement keeping in view the fact  

that no malafide has been alleged in the Scrutiny Committee nor any case of  

discrimination has been made out, cannot be accepted.  It is one thing to say  

that  a yardstick has been fixed for  the purpose of taking recourse  to the  

power of compulsory retirement but there cannot be any doubt or dispute  

that  such  yardstick  must  be  based  on  relevant  criteria.   If  the  relevant  

criteria, as has been laid down by the State, which has been adopted by the  

Federation, had not been acted upon, the order must be held to have been  

suffering from jurisdictional error.

45. It may be true that the superior courts in exercise of their power of  

judicial review ordinarily would not go into the factual findings as to which  

section  of  the  employees  should  be  brought  within  the  parameters  of

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Regulation 13 of the Regulations and which of them would not, but, in this  

case, we are concerned with a different question.

46. We, therefore, do not find any infirmity in the judgment of the High  

Court.

47. So far as the question of payment of back wages is concerned, we may  

notice Regulation 49(2) of the Regulations, which reads as under:

“49 (2) When the termination or retirement of  an employee from his service has been set  aside  by  the  court  and  the  employee  is  reinstated without any further departmental  proceeding, then the period of absence from  the period of  suspension,  will  be treated  s  the period on duty for all purposes including  the  grant  of  salary  and  allowances.   The  amount of  subsistence allowance to him if  has  been  paid  will  be  deducted  from  the  payable amount under this sub rule.”

A  bare  perusal  of  the  said  Regulation  would  clearly  show that  it  

applies in a case where an order of dismissal and/ or compulsory retirement  

by  way  of  punishment  is  set  aside.   It  is  not  a  case  where  order  of  

compulsory  retirement  had  been  passed  by  way  of  punishment.  

Respondents  – employees  herein were  not  charged with any misconduct.

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The order of compulsory retirement was issued in terms of the Regulation 13  

of the Regulations only.

48. Various decisions have been placed before us with regard to grant of  

back wages.  Even the learned Single Judge had granted 50% back wages in  

favour of 16 employees.  The Division Bench did not interfere therewith.  

We, therefore, fail to understand as to why the Division Bench thought fit to  

grant 20% back wages in respect of other employees.  The decisions placed  

before us show that this Court keeping in view the facts and circumstances  

of each case had refused to grant 75% back wages.

49. We, therefore, are of the opinion that 50% back wages should have  

been granted.

50. In Civil Appeal arising out of SLP (C) No. 17705 of 2008, as noticed  

hereinbefore,  an additional  ground has been taken that  Section 47 of the  

1995 Act would be attracted in the case of the appellant.  Section 47 of the  

1995 Act reads as under:

“47  -  Non-discrimination  in  Government  employment

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(1) No establishment shall dispense with, or reduce  in  rank,  an  employee  who  acquires  a  disability  during his service:

Provided  that,  if  an  employee,  after  acquiring  disability  is  not  suitable  for  the  post  he  was  holding, could be shifted to some other post with  the same pay scale and service benefits:

Provided further that if it is not possible to adjust  the employee against any post, he may be kept on  a  supernumerary  post  until  a  suitable  post  is  available or he attains the age of superannuation,  whichever is earlier.

(2)  No  promotion  shall  be  denied  to  a  person  merely on the ground of his disability:

Provided  that  the  appropriate  Government  may,  having regard to the type of work carried on in any  establishment, by notification and subject to such  conditions,  if  any,  as  may  be  specified  in  such  notification,  exempt  any  establishment  from  the  provisions of this section.”

51. The learned counsel submits that his client suffered disability in 1991.  

The 1995 Act,  thus,  did  not  come into  force  at  that  point  of  time.   His  

services were continued not as a disabled person within the provisions of the  

1995 Act.  He was treated equally and, thus, we see no reason as to why the  

entire  back  wages  should  be  granted  in  his  favour  whereas  all  other  

employees would be given 50% of their back wages.

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52. Furthermore,  such  a  contention  had  not  been  raised  before  the  

Division Bench.  It may be true that in a given case, this Court may allow  

the appellant to raise such a contention, as was done in the case of  Kunal  

Singh v. Union of India and Another [(2003) 4 SCC 524] whereupon strong  

reliance has been placed, but it is not automatic.   

It is evident from the record that even before the learned Single Judge  

the said contention was not raised at the first instance.  Only in the review  

petition, the said contention was raised.  But, the said review petition was  

dismissed.   As indicated  hereinbefore,  the  said  contention was again  not  

raised before the Division Bench.  We, therefore, are not inclined to agree  

with the contention that in terms of the 1995 Act, the appellant should be  

given 100% back wages.       

53. For the reasons aforementioned, the appeals filed by the Federation  

are  dismissed  and  that  of  the  employees  are  allowed  to  the  extent  

aforementioned with costs.  Counsel’s fee assessed at Rs. 10,000/- in each  

appeal.

………………………….J. [S.B. Sinha]

..…………………………J.     [Asok Kumar Ganguly]

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New Delhi; April 15, 2009