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PETITIONER: UNION OF INDIA

       Vs.

RESPONDENT: GURBAKSH SINGH & ANOTHER

DATE OF JUDGMENT05/02/1975

BENCH: BHAGWATI, P.N. BENCH: BHAGWATI, P.N. MATHEW, KUTTYIL KURIEN UNTWALIA, N.L.

CITATION:  1975 AIR  641            1975 SCR  (3) 444  1975 SCC  (3) 638

ACT: Displaced  Persons  (Compensation and  Rehabilitation)  Act, 1954  and  General  Clauses  Act (10 of  1897)  S.  16,  and Constitution  of  India 1950, Art.  310(1)--Post  of  Asstt. Commissioner  under 1954 Act--Whether services of  Incumbent could be terminated by State Government.

HEADNOTE: Under  s.  3(1) of the Displaced Persons  (Compensation  and Rehabilitation) Act, 1954, the post of Assistant  Settlement Commissioner is a post under the Union of India to which the appointment is to be made by the Central Government. In  exercise of this power the Central Government  appointed the  first  respondent  to  the  post  by  order  dated  3rd September,  1955.   Since  the  post  was  created  by   the President  of  India  only  for a period  of  6  months  the sanction for the post came to an end on 29th February  1956. The first respondent, how-ever, continued to function on the basis  of  sanction to its continuance given  by  the  State Government.  Thereafter, by an order dated 17th April, 1956, the State Government purported to terminate the services  of the  first  respondent with immediate  effect.   After  some correspondence, on February 18, 1959, the Central Government issued a memorandum that on the expiry of the period of  one month  given in the earlier memorandum of January  18,  1959 his services stood terminated with effect from February  18, 1959.   The respondent filed a suit against the Central  and the  State  Governments contending that  both  their  orders terminating  his services were illegal and invalid  and  for recovery  of arrears of salary, and allowances.   The  trial court  dismissed the suit.  In appeal to the High Court,  he contended  that his service was validly terminated  only  by the  memorandum  dated  18th January  1959,  issued  by  the Central  Government, and that he was therefore  entitled  to arrears  of  Wary and allowances upto 18th  February,  1959. This contention was accepted by the High Court. Dismissing the appeal to this Court, HELD  : The Central.  Government alone could  terminate  the appointment, both as the appointing authority as also  under Art. 310(1) of the Constitution. [451 H] (a)  The   State  Government  had  no  power  to  make   the

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appointment to the post unless such power was conferred upon it by virtue of a direction given by the Central  Government under s. 34, but there was no such direction, in the present case.   The  Central  Government only  empowered  the  State Government  to  nominate the person to be appointed  to  the post  but the appointment of the person so  nominated  could only  be  made  and,  in  fact,  was  made  by  the  Central Government by its order dated 3rd September, 1955. [450 D-F] (b)  The  State Government’s order dated 1st December,  1955 purporting  to appoint the first   dent was merely a  formal appointment letter pursuant to the suggestion       of   the Central  Government.  It had-no legal consequence  since  by that   the  first respondent was already  appointed  to  the post. [450 G] (c)  Moreover,  the post was sanctioned by the President  of India and created by the Central Government and the whole of the expenditure in connection with it was to be home out  of funds  allocated  by  the Central  Government.   The  State. Government’s.  order  purporting to accord sanction  to  the creation   of  the  post  was  only  for  the   purpose   of regularizing  its own accounts procedure in  disbursing  the amount allocated by the Central Government. [450 H-451 B] (d)  When  the question regarding the issue of pay  clip  in favour of the first respondent for the period subsequent  to 29th  February, 1950, arose, the Accountant General  of  the State pointed out that the sanction to the continuance                             445 of  the post given by the State Government  was  meaningless and ineffective and it could not be acted upon until receipt of sanction to its continuancy from the Central  Government. [451 C-D] Therefore, the Central Government, which was the  appointing authority,  could  terminate  the  service  of  the   first- respondent, under s. 6, General Clauses Act, 1897. [451 G] (e)  There is no provision under which the State  Government could  have  the  power  to  determine  the  appointment  as Assistant  Settlement  Commissioner  made  by  the   Central Government  under s. 3. The person appointed would hold  the post  during  the  pleasure of the President  and  only  the Central  Government would be entitled to terminate it.  [451 G-H] The High Court was, therefore, right in taking the view that the, order of the State Government dated April 17, 1956, was ineffectual  and invalid and that the service of  the  first respondent was validly terminated only on February 18, 1959, by the Central Government. [452 A-B] S.  R.  Tiwari  v.  Dt.  Board, Agra  [1964]  3  S.C.R.  55, referred to.

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal No. 11 of 1968. From  the judgment and order dated the January 16,  1967  of the  Punjab  &  Haryana High Court in  Civil  Regular  First Appeal No. 324 of 1961. R. N. Sachthey, for the appellant. Harbans Singh, for respondent No. 1. The Judgment of the Court was delivered by BHAGWATI,  J. The question that arises for determination  in this  appeal  is  as  to which  authority  was  entitled  to terminate  the service of the first respondent  the  Central Government or the Government of Punjab. The  first  respondent was, prior to his appointment  as  an Assistant  Settlement  Commissioner,  holding  the  post  of

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Deputy Registrar, Land Record in a temporary capacity  under the  State of Punjab.  The  first respondent had no lien  on arty  permanent  post  and was a temporary  servant  of  the Punjab  Government.   On  the  coming  into  force  of   the Displaced  Persons  (Compensation and  Rehabilitation)  Act, 1954  (hereinafter  referred  to  as  the  Act)  it   became necessary  to  appoint officers and stiff in  the  State  of Punjab for the purpose of carrying but various functions and duties under the Act.  One of such functions and duties  was grant of proprietory rights to quasi permanent allottees  of agricultural land and houses in the rural areas in the State of  Punjab.  The President of India,  therefore,  sanctioned the  creation of certain posts-which included two  posts  of Assistant Director to be designated as Assistant  Settlement Commissioner under the Actor a period of six months from the date of promulgation of the Rules framed under the Act  "for the  work connected with the conversion  of  quasi-permanent allotees into permanent ones" and the Central Government, by its letter dated 18th April, 1955 conveyed. his sanction  to the  State Government.  ’This letter contained  a  direction the over-all expenditure in connection with these posts CI/175 446 sanctioned  by the President of India should not exceed  Rs. 6.50  lacs  and  it  would be  shared  between  the  Central Government  and the State Government in the ratio of  50-50. It  was  also  suggested in this letter  Oat  the  names  of officers   appointed   as  Assistant  Directors   and   Naib Tehsildars  should be intimated in due course for  issue  of necessary  notifications  under the provisions of  the  Act. The  State Government, by its letter dated 3rd  July,  1955, pointed out to the Central Government that having regard  to the  large  magnitude  of the work  involved,  it  would  be necessary  to  have  two  whole-time  officers   exclusively devoted  to this work and suggested that two  posts  should, therefore,  be  permitted  to be created, one  of  a  Deputy Secretary  "who would have administrative control  over  all the managing officers and settlement officers and the  staff appointed  in  connection with the conferment  of  permanent rights"   and   the  other  of   an   Assistant   Settlement Commissioner.  It appears that the Central Government in the meantime   reconsidered  its  earlier  decision   that   the expenditure  on  the posts in connection with the  grant  of proprietary  rights to quasi-permanent allottees  should  be borne  50-50  between the Central Government and  the  State Government and by its letter dated 20th July, 1955 intimated to  the state Government that the Central  Government  would bear the entire expenditure on the staff appointed to  these posts  on  condition  that "the staff in  question  will  be engaged  for  a  period of six months  only".   The  Central Government  thereafter, by its letter dated 23rd July,  1955 conveyed  the  sanction  of the President of  India  to  the creation of one post of Additional Settlement     Commissioner and  one  post of Assistant Settlement commissioner  "for  a period  of  six  months  for the  work  connected  with  the conversion     of quasi-permanent allotments into  permanent ones on the scale of     pay  noted against each plus  usual allowances  admissible to the State Government employees  of their  status".   We are concerned in this appeal  with  the post of Assistant Settlement Commissioner sanctioned by  the President  of India as mentioned in this letter  dated  23rd July, 1955. Though  the order of appointment of the first respondent  to the  post of Assistant Settlement Commissioner was  not  yet passed, the first respondent relinquished charge of his post

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of  Deputy Registrar, Land Record and assumed charge of  the post of Assistant Settlement Commissioner on the forenoon of 1st  August, 1955 as appears from the certificate dated  1st August,   1955   (EX.    D-1).    The   Central   Government thereafter,  in  exercise  of the powers  conferred  by  sub Section  (1) of section 3 of the Act, issued a  notification dated 3rd September, 1955 appointing the first respondent to the  post  of  Assistant Settlement  Commissioner  "for  the purpose of performing the functions assigned to an Assistant Settlement Commissioner  by or under the Act".  The  Central Government also issued another notification of the same date in  exercise of the powers conferred by sub-section  (1)  of section  3 of the Act directing inter alia that the   ’first respondent, who has been appointed under that sub-section to the  post of Assistant Settlement Commissioner,  sW  perform the  assigned to an Assistant Settlement Commissioner by  or under the 447 Act  only  in respect of agricultural land situated  in  the State  of Punjab in rular area as defined in clause  (f)  of rule  2  of  the  Displaced  Persons  (Compensation)  ’  and Rehabilitation)  Rules, 1955, including houses, if  any,  in any  such area allotted along with such lands".  A  copy  of the  notification dated 3rd September, 1955  appointing  the first respondent to the post of Assistant Settlement Commis- sioner was forwarded by the Central Government to the  State Government  along  with its letter  dated  3/7th  September, 1955.  The Central Government also addressed a letter  dated 21st  September  1955 to the State Government  pointing  out that  since the 1st Respondent was to work as a  whole  time Assistant  Settlement Commissioner, it was presumed that  he had  relinquished charge of his previous office  and  adding that the first respondent having already been notified as an Assistant Settlement Commissioner and a copy of the relevant notification  having been forwarded to the State  Government along with the letter dated 3rd/7th September, 1955, "formal I appointment letter" may be issued by the State  Government and copies endorsed to this Ministry". It  appears  that the Governor of Punjab also, by  an  order dated  30th  November,  1955,  sanctioned  the  creation  of certain   posts  which  included  one  post   of   Assistant Settlement  Commissioner "for six months connected with  the conferment of permanent ownership rights on  quasi-permanent allottees of the land in the Rehabilitation Department  with effect from forenoon of 1st August, 1955".  There-after,  an 1st  December. 1955 the Governor of Punjab issued  an  order appointing  the  first respondent  as  Assistant  Settlement Commissioner  against  the  temporary post  created  in  the Rehabilitation.  Department for the work connected with  the conferment  of  permanent  ownership rights  on  the  quasi- permanent are allottees    of evacuee lands for a period  of six  months with effect from the 1st of August, 1955".   The State  Government, by its letter dated 15th  December,  1955 intimated.   to  the  Central  Government  that  the   first respondent, appointed as Assistant Settlement  Commissioner, had been given the scale of pay as sanctioned by the Central Government  and  confirmed  that the  first  respondent  was working as a whole ’time Assistant Settlement Commissioner. The first respondent accordingly held the post of  Assistant Settlement  Commissioner and carried out the  functions  and duties  attached to that post.  Since the post of  Assistant Settlement  Commissioner  was created by  the  President  of India  only  for  a  period of  six  months  and  the  first respondent  was  appointed  to  that  post  by  the  Central Government  on  September 1955. the sanction  for  the  post

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obviously came to an end on 20th February, 1956.  The  first respondent,  however,  continued to  function  as  Assistant Settlement  Commissioner  on the basis of  sanction  to  the continuance  of the post given by the Government of  Punjab. The  Accountant General, Punjab took the view that the  post of  Assistant  Settlement  Commissioner held  by  the  first respondent  haveing been created by the Central  Government, the  sanction  to  the  continuance  of  the  psot  received from the Punjab Government was futile and could not be acted upon until receipt of 448 sanction  from  the Central Government. and  by  his  letter dated 21st April, 1956, pointed out to the State  Government that the pay slip in favour of the first respondent for  the period  from 18th January, 1956 to 29th February,  1956  was being  issued,  but  so far as the pay  for  the  subsequent period upto 30th April, 1956 was concerned, "the sanction to the continuance of the post of Assistant Settlement  Commis- sioner upto 30.4.1956 which has been received in this office from  the Assistant Secretary to the Government  of  Punjab, Finance  Department  will  be  acted  upon  on  receipt   of "Sanction"  from  the Government of India as  the  post  was created  by  them"  and an attested copy  of  the  same,  if received, "may please be sent to enable this office to issue a pay slip to the officer upto 30-4-1956".  In the meantime, however,  the Government of Punjab, by an order  dated  17th April, 1956, purported to terminate the service of the first respondent  with  immediate effect and  directed  that  the, first respondent would be paid one month’s salary in lieu of notice.   The  first  respondent  thereafter  made   several representations to the Central Government as well as to  the State  Government  contending  inter alia  that  he  was  an employee of the Central Government and the State  Government was  not entitled to terminate his service and the order  of termination  of his service passed by the  State  Government was,  therefore,  invalid.  There was no response  to  these representations  for  a  long time.  It  was  only  on  10th January,   1959  that  the  Central  Government   issued   a memorandum informing the first respondent that "he was not a servant of the Government of India and that, even in case he considered  himself  to be such, this memorandum  should  be treated  as  a  notice  terminating  his  services  "without prejudice  to the contention that he was not the  Government of  India’s  servant." The Central  Government  also  issued another memorandum on 18th February, 1959 intimating to  the first  respondent  that on the expiry of the period  of  one month  given in the earlier memorandum dated  10th  January, 1959,  his  service stood terminated with effect  from  18th February 1959. The  first respondent thereupon gave notices to the  Central Government as well as the State Government under section  80 of the Code of Civil Procedure and filed a suit against  the Union  of India and the State of Punjab in the Court of  the Senior Sub-Judge, Jullundur claiming a declaration that  the order of the State Government dated 17th April, 1956 as also the order of the Central Government dated 10th January, 1959 terminating  the  services  of  the  first  respondent  were illegal and invalid and the first respondent continued as an Assistant  Settlement  Commissioner in the  service  of  the Central  Government and praying for recovery of  arrears  of salary  and allowances from 21st April, 1956 being the  date on  which  he  was  relieved  of  the  office  of  Assistant Settlement Commissioner.  Both the Union of India as well as the  State of Punjab resisted the suit.  The common  defence put  forward  by them was that the first  respondent  was  a

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servant  of the Government of Punjab and being  a  temporary servant, the Government of Punjab was entitled to  terminate his  service on giving one month’s notice of salary in  lieu of-notice and his service was, therefore, rightly terminated by  the order of the Government of Punjab dated 17th  April, 1956.  The Trial Court accepted this defence of the Union of India 449 and  the  State of Punjab and dismissed suit  of  the  first respondent with costs. The  first respondent preferred an appeal to the High  Court of  Punjab and Haryana.  The only contention put forward  on behalf of the first respondent at the hearing of the  appeal was  that the first respondent was servant of the  Union  of India  and  not of the State of Punjab and the  order  dated 17th  April,  1956  passed  by  the  State  of  Punjab  was, therefore, ineffectual to terminate the service of the first respondent  and it was only on 18th February, 1959 that  his service was validly terminated by the Central Government  by its   memorandum  dated  10th  January,  1959  and  he   was accordingly  entitled  to arrears of salary  and  allowances from  21st  April,  1956  to  10th  February,  1959.    This contention  found favour with the High Court and taking  the view that the first respondent was a servant of the Union of India  and not of the State of Punjab, the High  Court  held that  his  service  was validly terminated  only  from  10th February,   1959  under  the  memorandum  of   the   Central Government dated 10th January, 1959 and accordingly passed a decree  in favour of the first respondent against the  Union of India for Rs. 22,927.34P. representing arrears of  salary and  allowances from 4th August, 1956, being the date  three years  prior  to  the  institution of  the  suit  upto  10th February,  1959.  The Union of India being aggrieved by  the decree passed against it preferred the present appeal in the Court  on certificate obtained under Article 133(1)  (a)  of the Constitution as it stood at the material time. As  in the High Court, so also before us the  only  question debated  was as to whether it was the Central Government  or the  State  Government  or the State  Government  which  was entitled  to terminate the service of the first  respondent. The first respondent did not contend that the termination of his  service  was  by  way of  penalty  and  though  it  was disguised as termination simpliciter, it was in reality  and substance dismissal and hence violative of Article 311(2) of the Constitution.  He conceded that if the State  Government was entitled to terminate his service, the order dated  17th April,  1956, passed by the Government of Punjab,  would  be valid.   But his contention was that the Central  Government alone  was competent to terminate his service and  he  was,, therefore, continued as an Assistant Settlement Commissioner until  10 February, 1959 when his service was terminated  by the Central Government by the memorandum dated 10th January, 1959.  The Union of India, on the other hand, contended that the  first respondent was a servant of the State  of  Punjab and hence the Government of Punjab was entitled to terminate his service as it did by passing the order dated 17th April, 1956. Now,  if we look at the provisions of the Act, it  is  clear that  it is the Central Government which is constituted  the ultimate authority responsible for the administration of the provisions  of  the Act.  There is a hierarchy  of  officers constituted  under  the Act for the purpose  of  discharging various functions and duties and the final revisional autho- rity  in respect of these functions and duties is vested  in the Central Government.  Section 3, sub-section (1)  confers

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power  on  the  Central  Government  to  appoint  "a   Chief Settlement Commissioner, a Joint 450 Chief  Settlement  Commissioner  and as  many  Deputy  Chief Settlement    Commissioners,    Settlement    Commissioners, Additional  Settlement Commissioners,  Assistant  Settlement Commissioners,  Settlement  officers,  Assistant  Settlement Officers  and managing officers as may be necessary for  the purpose of performing the functions assigned to them "by  or under  the Act and the Central Government is also given  the power  by  general  or  special order  to  provide  for  the distribution  or  allocation of work to  performed  by  them under   the   Act.   The  post   of   Assistant   Settlement Commissioner-that being the post with which we are concerned in this appeal-is, therefore, clearly a post under the Union of India to which appointment is to be made by--the  Central Government.   It Was in exercise of this power conferred  by section   3,  sub-section  (1)  that   Central,   Government appointed  the  first respondent to the  post  of  Assistant Settlement  Commissioner by its order dated  3rd  September, 1956.   The  Government  of  Punjab had  no  power  to  make appointment to the post of Assistant Settlement Commissioner by its. order dated 3rd September, 1955.  The Government  of Punjab  had  no  power to make appointment to  the  post  of Assistant  Settlement  Commissioner, unless such  power  was conferred  upon  it by virtue of a direction  given  by  the Central  Government under section 34, but  admittedly  there was  no  such direction in the present case.  In  fact,  the Central  Government,  by its letter dated 18th  April,  1955 requested  the  State Government to intimate "the  names  of officers appointed as Assistant Settlement Commissioner" for issue of necessary notification under the Act.  Ile  Central Government did empower the State Government to nominate  the person  to be appointed to the post of Assistant  Settlement Commissioner but the appointment of the person so  nominated could  only  be made and Was, in fact made  by  the  Central Government by its order dated 3rd September, 1955. Once  the appointment   of  the            respondent   as   Assistant Settlement Commissioner was made  by the  Central Government by  its  order  dated 3rd September ,  1955  there  ’was  no question  thereafter  of the State  Government  once  again, appointing  him to the same post.  The State Government,  no doubt,  by its order dated 1st December, 1955, purposed  to, appoint   the  first  respondent  as  Assistant   Settlement Commissioner.  but  that was merely  a  formal  "appointment letter" pursuant to the suggestion         contained in  the letter of the Central Government dated 21st  September 1955. It was an ineffectual and futile exercise which bad no legal consequence  since  by that time the  first  respondent  was already  appointed  to  the  post  of  Assistant  Settlement Commissioner by the Central Government legally competent  so to appoint and he was already functioning as such  Assistant Settlement  Commissioner.  Moreover. the post  of  Assistant Settlement  Commissioner, to which the first respondent  was so  appointed,  was a post sanctioned by  the  President  of India and created by the Central Government and the whole of the expenditure in connection with that post was to be borne out  of the funds allocated by the Central Government,  vide the letter of the Central Government dated 23rd July,  1955. It  is  true that the State Government also,  by  its  order dated  30th November, 1955, purported to accord sanction  to the  creation  of  one post  of  Assistant  Settlement  Com- missioner  but  that  was  obviously  for  the  purpose   of regularizing its own account procedure because the amount of Rs. 6.50,lacs for meet-

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451 ing  the expenditure in connection with the staff  for  this work  was  made available by the Central Government  to  the State  Government and it Was the State Government which  was to disburse the expenditure out of that        amount.   The post  of  Assistant Settlement Commissioner  having  already been  created by the Central Government by the  sanction  of the  President of India as conveyed under the  letter  dated 25rd  July, 1955, did not need validation from the order  of the,  Government  of Punjab dated 30th  November,  1955.  in fact, when the question arose in regard to issue of pay slip in favour of the first respondent for the period  subsequent to  29th February, 1956, when the original sanction  of  the President  of  India for the post  of  Assistant  Settlement Commissioner expired, the Accountant General, Punjab pointed out  in his letter dated 21st April, 1956 that the  sanction to  the  continuance  of  the  post  given  by  the   Punjab Government was meaningless and ineffective and it could  not be  acted upon until receipt of sanction to the  continuance of the post from the Central Government since "the post  was created by them." It would therefore, be seen that the  post of  Assistant  Settlement Commissioner was  created  by  the Central Government and the expenditure in connection with it was  to  be  met out of the funds provided  by  the  Central Government and it was the Central Government alone which was competent  to make appointment to the post and in fact,  the first  respondent was appointed to the post by  the  Central Government by its order dated 3rd September, 1956.  It  this be  the correct position, as it undeniable is, there can  be no  doubt that the Central Government alone could  terminate the  service  of  the first respondent.  It is  now  a  well settled  rule  of  interpretation that a  power  to  appoint ordinarily  implies  a power to  determine  the  employment. That  was  pointed  out by this Court in  S.  R.  Tiwari  v. District Board, Agra(1) :               "Power  to appoint ordinarily carries with  it               the  power  to determine  appointment,  and  a               power  to  terminate  may in  the  absence  of               restrictions express or implied be  exercised,               subject  to the conditions prescribed in  that               behalf,   by   the  authority   competent   to               appoint." This  rule is also found incorporated in section 16  of  the General Clauses Act, 1897.  It is, therefore, clear that the Central  Government  which  is  given  the  power  to   make appointment to the post of Assistant Settlement Commissioner under section 3, would also have the power to determine  the appointment.  The Central Government would also be  entitled to  terminate the appointment, since the post  of  Assistant Settlement  Commissioner is a post under the Union of  India and  the  person appointed to it would hold  it  during  the pleasure  of  the President.  There is  no  provision  under which  the  Government  of Punjab could have  the  power  to determine   the   appointment   as   Assistant    Settlement Commissioner made by the Central Government under section 3. The   Central   Government   alone   could   terminate   the appointment, both as the appointing authority as also  under Art. 310(1) of the Consti- (1)  [1964] 3 S. C. R. 55. 452 tution.  The High Court was, therefore, right in taking  the view  that  the order of the Punjab  Government  dated  17th April,  1956 was ineffectual and invalid and the service  of the  first respondent as Assistant  Settlement  Commissioner

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was validly terminated only on 10th February, 1959 when  the Central  Government, by its memorandum dated  10th  January, 1959,  gave  notice  terminating the service  of  the  first respondent.,  There  was no dispute before us  that  if  the service  of  the  first respondent came to an  end  on  10th February,  1959,  and not earlier on 17th April,  1956,  the first  respondent  would  be  entitled  to  a  sum  of   Rs. 22,927.34P. as decreed by the High Court. The appeal, therefore, fails and is dismissed with costs  in favour of the first respondent. V.P.S.                             Appeal dismissed. 453