Gujarat High Court
Ashmi Mehul Thaker & 2 vs Gujarat National Law University (Gnlu) on 6 February, 2017
Author: Sonia Gokani
Bench: Sonia Gokani
C/SCA/6296/2016 CAV JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 6296 of 2016
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS JUSTICE SONIA GOKANI
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1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of
the judgment ?
4 Whether this case involves a substantial question of
law as to the interpretation of the Constitution of
India or any order made thereunder ?
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ASHMI MEHUL THAKER & 2....Petitioner(s)
Versus
GUJARAT NATIONAL LAW UNIVERSITY (GNLU)....Respondent(s)
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Appearance:
MR KB PUJARA, ADVOCATE for the Petitioner(s) No. 1 - 3
MS M O NARSINGHANI, ADVOCATE for the Respondent(s) No. 1
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CORAM: HONOURABLE MS JUSTICE SONIA GOKANI
Date : 06/02/2017
CAV JUDGMENT
1.0 The petitioners are the employees of the Respondent No.1-Gujarat National Law University (for short, 'the GNLU'), which is established under the Gujarat National Law University Act, 2003. The GNLU came to be established on the land allotted by the State of Gujarat at Koba, Page 1 of 62 HC-NIC Page 1 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Gandhinagar. The appointment of the petitioners in the GNLU was pursuant to the regular process of selection by inviting applications through the public advertisement from all eligible candidates. Interviews were conducted by the Selection Committee and the selection was made on the basis of merits.
2.0 The appointment order of Petitioner No.1 on the post of Asst. Administrative Officer was issued on 17.04.2006, whereas, the order of modification of terms of appointment and salary was issued on 31.10.2006. Thereafter, the orders of extension of appointment came to be passed on 16.04.2007, 26.04.2008 and 05.04.2010 in case of Petitioner No.1.
2.1 So far as the petitioner No.2 is concerned, he was appointed on the post of Secretary to the Director on 08.06.2004 and the re-designation of the said post as Sr. Administrative Assistant came to be done on 07.08.2004. Thereafter, the letter of completion of probation came to be issued on 05.07.2005 and the last letter of extension of appointment on the post of Administrative Coordinator came to be issued on 05.04.2010.
2.2 The petitioner No.3 came to be appointed Page 2 of 62 HC-NIC Page 2 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT on the post of Administrative / Estate Assistant by order dated 01.07.2004. The said post was re- designated as Sr. Assistant Stores and Campus Development and his salary was re-fixed vide letter dated 01.03.2005. He was issued the letter of completion of probation on 01.07.2005, whereas, the last letter of extension of appointment was given on 08.12.2009.
2.3 In short, the initial appointment of all the petitioners was for one year, as a part of five years' contract, which was to be extended at the discretion of the Executive Council. The appointment, as per the contract, at the end of the period of contract may be extended for further period or up to the age of superannuation. Other terms and conditions of service were at par with the comparable practices prevailing at National Law Schools, but, subject to review / variation as the Executive Council may, at its discretion, determine from time to time. The initial appointment of the petitioners were approved by the Executive Council and the Governing Council of the GNLU, which is the apex body of the of the university.
2.4 On 18.04.2015, the Registrar of the GNLU through e-mail informed the petitioners that with reference to their five years' contract as per Page 3 of 62 HC-NIC Page 3 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT the letters issued in the years 2009 and 2010, as the matter of permanent appointment was under
consideration, their contract be construed to be extended till further notice. It was also stated, therein, that this would not create any right to renewal or further extension or conversion of the contract in the permanent appointment and the GNLU would inform them as and when the final decision is taken by the General Council. The petitioners' grievance is that no such final decision has been communicated to the petitioner until the date of filing of the present petition.
2.5 The Government of Gujarat sanctioned the pay-scale of 6th Pay Commission for employees of the GNLU vide government Resolution dated 07.10.2009 and the GNLU also issued administrative directions in that regard on 30.09.2015. Accordingly, Petitioner Nos. 1 and 2 are re-designated as Section Officers and Petitioner No.3 as Dy. Section Officer since December, 2015. The first two petitioners were placed in the pay-band of Rs.9300-34,800 with grade-pay of Rs.4600/- and the petitioner No.3 was placed in the pay-band of Rs.9300-34800 with the grade-pay of Rs.4200/-.
2.6 It is the case of the petitioners that, at the time of their initial appointment, they Page 4 of 62 HC-NIC Page 4 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT were employed elsewhere and had good experience and were looking for better carrier prospects, and therefore, they joined the GNLU, since, it was a newly established law school at Gandhinagar. Their appointment was initially, though, on probation for one year as a part of five years' contract, at the end of the said period, the appointment was to be extended upto the age of superannuation. The age of superannuation is 62 years for academic staff and 58 years for the rest, as prevailing in other law schools. All the three petitioners, respectively, joined the duties with the GNLU on 18.04.2006, 05.07.2004 and 01.07.2004, expecting that they shall be continued until they reach the age of superannuation.
2.7 It is also the case of the petitioners that they have been continued in the employment of the GNLU on the basis of Management Peformance Appraisal System (in brief, 'MPAS'), which is part and parcel of the system of appraisal and their performance has been regularly rated as, 'Good', 'Very Good' or 'Distinguishing'. Their annual increments have also been regularly released, and therefore, they have excellent track record of highly meritorious services in the GNLU. So far no occasion has arisen for issuance of any notice for any in-action or Page 5 of 62 HC-NIC Page 5 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT action on the part of any of the petitioners.
2.8 The petitioners needed to approach this Court as a notice came to be issued on 01.03.2016 termed as 'End of Contract Notice'. No reason for such an abrupt end of their contract of service is stated in the said order. The extension of the current contract of the petitioners was at the end of 31.05.2016, and therefore, 31.05.2016 was construed as the last working day. Such a notice came to be issued to total 24 employees, viz. 7 members of Academic Staff and 17 members of Administrative Staff including the present petitioners for ending their contract or termination of their services.
2.9 The petitioners, therefore, along with others made a representation on 03.03.2016 to the Director of the GNLU, requesting for withdrawal of the said notice. One more representation was given by them on 05.03.2016 for regularization of the services of the existing employees. However, the same also had not bore any fruit. Instead the petitioners were orally informed by the Director that their employment status was decided by the GNLU in its meeting dated 27.02.2016, on the basis of Permanency Committee Resolution. Therefore, the third representation dated 15.03.2016 was given to the Visitor of the GNLU Page 6 of 62 HC-NIC Page 6 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT and the Hon'ble Judge of the Supreme Court of India (His Lordship, Hon'ble Mr. Justice Abhay Manohar Sapre) and a request was made to put on hold the said resolution of the Permanency Committee.
2.10 Pursuant thereto, an advertisement came to be issued by the GNLU on 16.03.2016, where, the petitioners were also advised to apply in response to the said posts for getting permanent appointment. It was, thereby, suggested that the GNLU thus offered an opportunity to get the petitioners regularized in the selection. It is the case of the petitioners that the advertisement in question is for the posts and pay-scales, which are different from the current posts and the pay-scales.
2.11 Therefore, another representation was made on 19.03.2016 to the Members of the General Council, which is the apex body of the GNLU.
2.12 Thereafter, yet another representation along with substantiating documents was given to the Members of the General Council of the GNLU on 22.03.2016. Relying on the report of one member Commission of the GNLU Review Commission prepared by Prof. Bakul Dholakia in the month of November, 2013, wherein, he had expressed categorically Page 7 of 62 HC-NIC Page 7 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT that there was a danger that the GNLU might lose well qualified and well experienced faculty and other staff members if no regularisation is done.
It was opined that based on their performance and qualifications, they can be offered permanent appointments. It is also stated therein that the UGC and BCI on various occasions have made recommendations to convert contractual appointments into regular appointment. However, the GNLU has not yet implemented the same so far. As more and more five years degree institutions are being created in the State of Gujarat and in India as a whole, any delay in implementation in this regard as expressed in the report may prove irreparably detrimental to the bright future of the GNLU.
2.13 Here, it may be noted that the National Assessment and Accreditation Council ('NAAC', for short), which is an institution of the UGC visited the GNLU from 02.02.2016 to 04.02.2016 and accredited it with the grade 'A'. However, it has made certain recommendations to maintain quality enhancement of the institution, and one of such recommendations was to regularize the faculty and administrative staff at the earliest.
2.14 Again UGC submitted the report of the Expert committee of the UGC for declaring it fit Page 8 of 62 HC-NIC Page 8 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT to receive central assistance in terms of rules framed under Section 12(B) of the UGC Act, 1956, wherein, it is clearly suggested that the service conditions, revision of pay, payment of arrears as well as service regulations, which are to be put in place at the earliest to retain the academic and administrative staff at the GNLU, wherein, it is clearly suggested to streamline and regularize all the appointments to posts after an initial contract of employment for a period of five years.
2.15 No response has been received by the petitioners in that regard either from the Director or the Governing Council or the Visitor of the GNLU. The petitioners are, therefore, before this Court challenging the inaction on the part of the GNLU.
2.16 Thus, the central theme of the present petition is the regularization of the services of the petitioners, who have rendered nearly 10 to 12 years service without any interruption with the following prayers;
"30. The petitioners therefore humbly pray that YOUR LORDSHIP BE PLEASED to issue a writ of or in the nature of mandamus and / or certiorari and / or prohibition and / or any other appropriate writ, Page 9 of 62 HC-NIC Page 9 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT order or direction:-
(a) to quash and set aside the impugned orders / notices dated 1-3-
2016 at Annexure-I Colly.;
(b) to direct the respondent to continue the petitioners in its employment with protection of pay, allowances and designation till they reach the age of superannuation;
(c) to quash and set aside the impugned Advertisement dtd. 16-3- 2016 at Annexure-M in so far as and to the extent to which it purports to replace the petitioners by new candidates;
(d) PENDING THE HEARING AND FINAL DISPOSAL OF THIS PETITION, BE PLEASED to stay the operation of the impugned orders / notices dated 1-3- 2016 at Annexure-I Colly;
(e) PENDING THE HEARING AND FINAL DISPOSAL OF THIS PETITION, BE PLEASED to stay the recruitment process initiated by the Advertisement dtd. 16-3-2016 at Annexure-M;
(f) PENDING THE HEARING AND FINAL
DISPOSAL OF THIS PETITION, BE
PLEASED to direct the General
Council of GNLU to consider/re-
consider and decide the
representations made by the
petitioners dtd. 19-3-2016 at
Annexure-O and dtd. 22-3-2016 at Annexure-P Colly. And to communicate such decision to the petitioners and to place it on record of this petition;
Page 10 of 62HC-NIC Page 10 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT
(g) to grant any other appropriate and just relief/s including the costs of this petition;
(h) to quash and set aside the impugned communications dated 17-3- 2016 issued by the respondent University to the petitioners as per Annexure-N Colly."
3.0 This Court, while issuing notice on 18.04.2016, granted interim relief in terms of Paragraph-30(d), and thereby, stayed the operation of the impugned order / notice dated 01.03.2016.
4.0 The Director of the GNLU in his affidavit denied all the allegations made by the petitioners in this petition and contended further that in the contractual appointments the Court cannot decide, whether a more reasonable decision or course of action could have been taken in the circumstances so long as the action taken by the authority is not shown to be vitiated by the infirmities and so long as the action is not demonstrably in outrageous defiance of logic, the Court cannot interfere with the decision. Thus, it is the central theme of the defence that the tenure of contract was fixed in case of the present petitioners and renewal of contract of employment depended upon assessment of the management as to the continuance of the Page 11 of 62 HC-NIC Page 11 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT posts held by them and the need for an incumbent to such positions / posts and usefulness of the petitioners.
4.1 On 17.04.2004, the GNLU gave public advertisement in the local newspaper for different posts and the petitioners were interviewed and were offered appointment on contractual basis, which was accepted by them. In the extensions made subsequent thereto also, it had been made clear that their appointments were contractual and for a limited period and terminable by either side on notice or on payment of salary in lieu, thereof.
4.2 Further, the contractual appointment offered by the GNLU to the petitioners was limited in tenure and was terminable by notice on either side and that there was no element of any unfair treatment or unequal bargaining power between the respondent university and the petitioners to call for an over-sympathetic or protective approach towards them. Moreover, according to the Respondents, in absence of any unreasonableness, unfairness, perversity or irrationality in the action take by the Respondents, no intervention is called for. It is a matter of flexible policy, whether, the Respondents can engage teaching or non-teaching Page 12 of 62 HC-NIC Page 12 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT staff for a limited duration in the initial period of its establishment and after having acquired stability in functioning, depending on the requirements of the institute, can it not move towards the permanent appointment. It is, further their say that after the period of probation, the services of an employee can be terminated by issuing notice by either side or on payment of salary in lieu of the same. It is also their say that the extension of appointment, as per the documents, was to expire without prior notice on the expiry date. However, the extension of the fixed term appointment can be extended, which would be upon the need of the university, performance record of the employees and other criteria that may be fixed by the Executive Council from time to time.
4.3 In the 10th General Meeting held on 03.06.2013 and in the subsequent meetings, the matter was discussed by the General Council. In the 13th General Meeting held on 14.02.2015, the Council resolved that the Committee, entrusted to examine the issue of conversion of contractual appointment into permanent appointment of eligible teaching and non-teaching staff of the GNLU, shall study the systems prevalent in other law universities and frame rules that would ensure that teaching and non-teaching staff Page 13 of 62 HC-NIC Page 13 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT appointed against permanent post(s) are subject to annual performance review and provide for termination of the employment in case their performance falls below the expected or prescribed levels. To assist the Committee on the aforesaid aspect, two new members were inducted, therein.
4.4 In the e-mail dated 18.04.2015, it was specifically mentioned that as the matter of permanent appointment was under consideration, their contract be construed to be extended till further notice and that this would not create any right to renewal or further extension or conversion of the contract in the permanent appointment.
4.5 In the 14th meeting of the Council held on 27.02.2016, it deliberated and approved the report and recommendations of the committee as a whole and it was resolved that respondent university shall conduct recruitment of teaching and non-teaching staff against permanent posts through fresh advertisement and in conformity with the regulations and norms prescribed by the UGC and the Government of Gujarat for teaching and non-teaching staff, respectively.
4.6 According to the respondents, the Page 14 of 62 HC-NIC Page 14 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT petitioners were, earlier, in service of another employer before they chose to accept a contractual appointment offered to them by them, which was limited in tenure and was terminable on notice by either side or on payment of salary in lieu thereof, and therefore, there is no element of unfair treatment. The petitioners joined the services with the GNLU with open eyes, which was, initially, on one year probation as a part of five year contract and at the end of the contract, the appointment was to be extended upto the age of superannuation is misconceived and incorrect and neither the letter of appointment nor any of the extension letters mentioned that the appointment would be extended upto the age of superannuation, and therefore, no regularization of the services can be claimed, when the appointment was purely contractual and that such a contract of employment was terminable even during the period of 1 to 5 years on notice by either side or on payment of salary in lieu thereof. Of course, these posts were decided to be made permanent in the decision of the General Council, but, after giving a fair opportunity to the others also. The absorption of everyone directly was not found acceptable and a fair opportunity was resolved to be given to all eligible persons.
Page 15 of 62HC-NIC Page 15 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT 4.7 The advertisement dated 16.03.2016 was, therefore, published. It is, further, contended that there was no compulsion on the petitioners and they were free not to enter into the contract and if, they have so done, it is their own fault. They have been treated like any other employee to whom an offer of temporary employment, under the aforementioned background was given. According to the respondents, the pronouncements of the Apex Court and the development of law in the past few decades clearly show that termination of a contractual employment in accordance with the terms is permissible and the employee could claim no protection against such a termination even when, one of the contracting parties happens to be the State. According to the Respondents, every university has a right to take its own administrative order for betterment of the university and its employees and no university can be forced to follow the practice of other universities.
5.0 Affidavit-in-rejoinder and additional affidavit, Dated: 06.08.2016, on behalf of the petitioners is also brought on record. According to the petitioner, the conversion of contractual appointment into permanent one was the agenda Item No. 5 of the 21st Meeting of the Executive Council held on 31.05.2012, which recommended Page 16 of 62 HC-NIC Page 16 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT some changes in the GNLU regulations to the General Council on the basis of approval of the policy for conversion of contractual appointments into permanent ones.
5.1 In the 22nd meeting of the Executive Council held on 19.07.2012, as per the Agenda Item No. 17, said recommendations were to be placed before the General Council and the recommended amendment was to be approved by the Visitor and other Members of the General Council. Therefore, a list of 27 employees, including the present petitioners, was placed for the approval of the Executive Council. The 22nd Meeting of the Executive Council held on 19.07.2012 considered the said Agenda Item No. 17 and approved the conversion of the petitioners and others from contractual to permanent and resolved that the conversion from contractual to permanent post of eligible staff members shall be done by the Empowered Committee consisting of the Director, Principal Secretary (Finance) and Law Secretary.
5.2 Pursuant thereto, according to the petitioners, as recorded in the minutes of 23rd Meeting of the Executive Council, which was held on 15.09.2012, the petitioners had already been converted into permanent employment from contractual employment in the year 2012, itself.
Page 17 of 62HC-NIC Page 17 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT The matter of permanent appointment was under
consideration, as per the e-mail dated 18.04.2015, and therefore the impugned communication of termination came as a shock to the petitioners.
5.3 It is also the grievance of the petitioners that the final decision of the General Council in regard to the conversion of contractual employment into permanent one has not been communicated to them, inasmuch as no such final decision has been taken by the General Council. It is, further, their say that such a decision would apply to the case of the petitioners, who are appointed on contractual basis prior to such decision, whereby, their appointment had been approved to be converted from contractual into permanent ones by the Executive Council in the year 2012. It is the say of the petitioners that as some adverse actions had been apprehended by them, on the basis of some decision purported to have been taken by the General Council in its meeting held on 27.02.2016, they had a meeting with the Director and the Registrar of the GNLU on 29.02.2016 and the Director had agreed to have them look at the agenda and minutes of meeting from the year 2005 to 2016. The petitioners were assured that their request shall be placed before Page 18 of 62 HC-NIC Page 18 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT the Visitor for advice. However, no response so far has been received by the petitioners on the subject nor were they provided the agenda and the minutes of meetings of the General Council from 2005 to 2016. Further, there is no reference of any such decision of the General Council Meeting held on 27.02.2016 in the termination order dated 01.03.2016, which is under challenge in this petition.
5.4 It is repetitively emphasized by the petitioners that their appointment could not have been subject-matter of consideration by the General Council in its 10th Meeting held on 03.06.2013 or its 13th Meeting held on 14.02.2015, since, the appointments of the petitioners had already been converted from contractual into permanent ones and approved by the Executive Committee on 19.07.2012. It is, further, their say that it is repetitively stated by the Respondents that renewal of contract of employment depended upon (i) assessment of the management as to continuance of the posts held by the petitioners, (ii) need for an incumbent to such positions / posts and (iii) usefulness of the petitioners. However, for discontinuing the services of the petitioners, which is the ground is not made clear. It is, further their say that the minutes of the 5th Meeting of the Permanent Page 19 of 62 HC-NIC Page 19 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Appointment Committee held on 10.03.2015, the Committee nowhere recommended the termination of the services of the petitioners and to make fresh appointment in their place and an attempt was made to mislead the General Council by inserting the contents, as per Page Nos. 106 to 107 of the matter, with a request to the General Council to approve the same by way of Circular Resolution by a letter dated 19.03.2015, where, the Hon'ble Mr. Justice, T.S. Thakur, Judge, Supreme Court of India and Visitor of the GNLU (as His Lordship then was) put remarks that amendment of rules and regulations, since, constitute an important subject, the draft rules and regulations therefore need to be placed before the General Council in its next meeting whenever held and circulation is not a desirable mode for approval of the proposed rules and regulations. The General Council has not been appraised the decision and approval of the Executive Council in the year 2012. Moreover, the report of one Member GNLU Review Commission prepared by Prof. Bakul Dholakia in November, 2013, also possibly has not been placed before the General Council. The recommendations of NAAC to regularize the faculty and administrative staff at the earliest and the report of UGC Expert Committee to assess the proposal of the GNLU for declaring it fit to receive Central Assistance, which also contained Page 20 of 62 HC-NIC Page 20 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT recommendation to regularize all appointments to posts after an initial contract of employment for a period of five years, which has been disregarded, coupled with the fact that other national law universities have made their administrative staff permanent after the completion of their initial period of five years.
Therefore, there is no good reason for not following the said practice.
6.0 Sur-rejoinder and affidavit-in-reply on behalf of the GNLU is also brought on record. However, the same requires no elaboration, except, the fact that it has been denied that the petitioners were already converted from their contractual appointments to the permanent ones in the year 2012, itself. In fact, in the 22nd Meeting of the Executive Council held on 19.07.2012, the agenda No.17, where, the conversion of the petitioners from the contractual to permanent post, was considered and approved, wherein, it was resolved, on the basis of change in the Regulation that the conversion of contractual to permanent post of the eligible staff members shall be done by the Empowered Committee, consisting of Director, Principal Secretary [Finance] and Law Secretary.
6.1 According to the respondents, said Page 21 of 62 HC-NIC Page 21 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT resolution was passed on the premises that regulations would be amended as per the recommendations of the Executive Council and the correct minutes of the meeting dated 15.09.2012 are annexed at Annexure-VI of the sur-rejoinder and affidavit in reply filed on behalf of the Respondent. However, the emphasis is that the General Council in its meeting held on 27.02.2016 has approved the amendments to the regulations, which do not contemplate such conversion.
6.2 Pursuant to the advertisement issued by the GNLU on 16.03.2016, large number of employees including the petitioners applied and all selected persons on contractual appointments, except, the present petitioners have been informed about their selection. The GNLU has followed the procedure as per the amended regulations. It was post amendment to the regulations and pursuant to the resolution that the petitioners were intimated that their current contract would end on 31.01.2016.
7.0 This Court has heard the learned Advocate, Mr. Pujara, on behalf of the petitioners, who strongly and fervently urged along the line of pleadings. The chronology of events also is provided for ready reference. During the course of hearing, a draft amendment Page 22 of 62 HC-NIC Page 22 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT had been moved, which has been allowed. It is strenuously argued by the learned counsel Mr. Pujara that there is no decision of either General Council or of Executive council to discontinue the service of petitioners or of other employees. It was never the subject referred to these bodies. The proposed regulation which was approved by executive council was not for permanent appointment. He further argued that it is factually incorrect to say that executive council had no authority under the regulations when appointments were made. According to him, provisions did exist. According to him, on the 31 May 2012, executive council approved the appointments. What was recommended was regularisation and not permanency. On the strength of appraisal , performance and also the need of University, regularisation was to be done. What had been suggested by way of amendments in the regulations was for the future and not for the existing staff members.
8.0 Per contra learned Sr. Advocate, Mr. Mihir Thakor, appearing with learned Advocate, Mr. Narsinghani, has also contested this petition with equal fervency. His emphasis is on contractual appointment and participation in the examination pursuant to the advertisement once permanent posts were made. Learned senior counsel Page 23 of 62 HC-NIC Page 23 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Mr Thkore submitted that till the 19th meeting of executive council, there was no decision to convert these posts into permanent posts. Executive council proceeded on the premise that the general council would approve. Some of the members objected to such action of the respondents to carry out by circulation any amendment in the regulations. And hence , according to the learned Counsel, the same could not be said to have come into effect. However ,disapproval by the general council would not allow the petitioners to claim any rights.
9.0 The fulcrum of the consideration is as to whether, the petitioners, who were initially appointed on contractual basis for a fixed term of five years and who have been continued for the extension periodically, can claim the permanency on the permanent posts and whether any such challenge is permissible having participated in the process of recruitment against permanent post? Again whether, the decision of Executive Council in the year 2012 for permanency would govern the case of the petitioners in wake of reports of Dr. Bakul Dholakia and those of UGC and BCI?
9.1 The facts in capsulized form as can be noticed are that the petitioners applied for the Page 24 of 62 HC-NIC Page 24 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT posts of Asst. Administrative Officer, Secretary to Director and Administrative / Estate Assistant, respectively, pursuant to a public advertisement issued by the GNLU inviting applications from all eligible candidates in wake of the establishment of the GNLU in the year 2003. All the three petitioners came to be appointed as administrative staff. The original posts of the petitioners came to be re-designated in the year 2004 and 2005, respectively and on completion of period of one year probation, they came to be confirmed on the respective posts, as part of five years contract and they continued to serve on those posts their terms of appointments continued to be extended from time to time.
9.2 In the year 2009, on 01.09.2009 the GNLU regulations were framed. By way of the Government Resolution dated 07.10.2009, the pay- scale, as per the 6th Pay Commission of the GNLU was sanctioned and the petitioners were granted the benefit of the same. The petitioners were offered extension on fixed term appointment, subject to the GNLU regulations and the changes that will be made in such regulations from time to time. It is not a matter of dispute that the terms and conditions of the extension letter respectively given to each of the petitioner were accepted by them individually.
Page 25 of 62HC-NIC Page 25 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT 9.3 The bone of the contentions between the parties is the resolution of the 23rd Meeting of the Executive Council, which was held on 15.09.2012. According to the petitioners, they have already been converted into permanent employment from contractual employment, as per the Agenda Item No. 17 of the 22nd meeting of the Executive Council held on 19.07.2012. Although, this being a matter of record, no challenge could be made possibly to this. But, according to the respondent-University that itself is no ground to hold in form of the petition, when the Apex body did not approve the same.
9.4 It is apt to refer to the 22nd meeting of the Executive Council of the GNLU held on 19.07.2012, wherein, Agenda Item No. 17 was for conversion of the contractual employees to permanent employees and the Executive Council had decided to discuss the same in the second session of the said meeting.
9.5 Prior to that the conversion of contractual appointment into permanent one was the agenda Item No. 5 of the 21st Meeting of the Executive Council held on 31.05.2012, which recommended some changes in the GNLU regulations to the General Council on the basis of approval Page 26 of 62 HC-NIC Page 26 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT of the policy for conversion of contractual appointments into permanent ones. The Executive Council discussed the said agenda, which reads thus;
" Agenda 5: Duration of appointments of GNLU employees The Council discussed the agenda item and adopted and approved the following text as the amended regulation, and recommended the same for approval by the General Council.
GNLU Before Approval After Approval Regulatio n No. 15(5) Initial appointment Initial for all faculty appointment for members shall be all faculty made for duration members shall be of five years with made for the one year probation duration of five period. Subsequent years with one extension(s) of the year probation contract shall be period.
made on the basis Subsequent
of needs of the extension(s) of
University, the appointment
performance or conversion of
standards and any the appointment
other criteria as in permanent
may be fixed by the employment shall
Executive Council, be made on the
from time to time. basis of the
The contract needs of the
extension may be University,
granted for a performance
period of five records, and any
years or three other criteria as
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C/SCA/6296/2016 CAV JUDGMENT
years, as may be fixed by
determined by the the Executive
Contract Extension Council from time
Committee. The to time and upon
Contract Extension the
Committee shall be recommendation of
composed of the the Dean Academic
Director, Affairs to the
Registrar, Head of Director and
Academic Affairs subsequent
and two members of approval by the
the Executive Executive
Council as Council.
nominated by the
Executive Council.
17(6) Initial appointment Initial
for all appointment for
administrative and all
ministerial staff administrative
shall be made for and ministerial
duration of five staff shall be
years with one year made for the
probation period. duration of five
Subsequent years with one
extension(s) of the year probation
contract shall be period.
made on the basis Subsequent
of needs of the extension(s) of
University, the appointment
performance or conversion of
standards and any the appointment
other criteria as in permanent
may be fixed by the employment shall
Executive Council be made on the
from time to time. basis of the
The contract needs of the
extension may be University,
granted for a performance
period of five records and any
years of three other criteria as
years, as may be fixed by
determined by the the Executive
Contract Extension Council from time
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Committee. The to time and upon
Contract Extension the
Committee shall be recommendation of
composed of the the Registrar to
Director, the Director and
Registrar, Head of subsequent
Academic Affairs approval by the
and two members of Executive
the Executive Council.
Council as
nominated by the
Executive Council.
"
9.6 It appears thus that the Executive
Council authorized the Director to place the
amended regulation for approval by the General Council by way of circular resolution for giving effect to the regulation for those, who meet the above requirements of the regulation. It, further, says that the amended regulations shall have effect prospectively. It thus speaks of conversion from contractual appointment to permanent appointment.
9.7 For ratification of the amendments of GNLU Regulation No. 15(5) and 17(6) concerning employment duration was a subject addressed to the members of the General Council by way of Circular Resolution, where, the Director sought approval from the Members of the General Council to approve the draft resolution, as was passed by the Executive Council. One of the members of the Page 29 of 62 HC-NIC Page 29 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Governing Council, Hon'ble Mr. Justice Jayant Patel, Judge, Gujarat High Court (as His Lordship, then was and presently, Judge, Karnataka High Court), addressed a communication dated 27.08.2012 to the Director of the GNLU stating, therein, that unless the facts and figures of the existing contractual appointments and the future permanent employment and other incident aspects thereto are considered and discussed in context of the permanent financial liability, which may fall upon the GNLU, the issue cannot be decided by Circular Resolution, and therefore, the question of approval may be decided at the Governing Council meeting in person and not by Circular Resolution, which came to be approved by the Visitor and the sitting Judge of the Supreme Court of India, Hon'ble Mr. Justice Anil R. Dave (as His Lordship then was).
9.8 So far as the agenda of the 22nd Meeting of the Executive Council held on 19.07.2012, which pertained to the conversion of the contractual appointment into the permanent ones, the Executive Council noted the changes in the regulations and resolved that the conversion of the contractual appointments to permanent appointments of eligible staff members shall be done by the Empowered Committee, consisting of the Director, Principal Secretary (Finance) and Page 30 of 62 HC-NIC Page 30 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Law Secretary. The list of the recommended employees had also been noted by the Executive Council.
9.9 In the 23rd Meeting of the Executive Council held on 15.09.2012, it approved the agenda item of conversion of contractual appointments into permanent appointments. It is a matter of record that there was no approval to the amended Regulation Nos. 15(5) and 17(6) of the GNLU regulations by the General Council and yet the fact remains that, the Executive Council had given the approval of conversion of the contractual appointments to the permanent ones.
9.10 The General Council in its 9th Meeting held on 19.01.2013, so far as the agenda of conversion of the contractual appointments into the permanent appointment is concerned, decided to wait for the recommendations of the Visitor. It is required to be noted, at this stage, that the regulation 46 (5)(1) provides that all regulations made by the Executive Council shall be submitted to the General Council and the Visitor for approval. In the 10th General Meeting of the General Council held on 03.06.2013, it was resolved to constitute a committee comprising of the following members;Page 31 of 62
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(i) Hon'ble Mr. Justice Ravi R. Tripathi, Judge, High Court of Gujarat;
(ii) Hon'ble Mr. Justice, Jayant M. Patel, Judge, High Court of Gujarat;
(iii) Mr. Kamal B. Trivedi, Advocate General, State of Gujarat;
(iv) Mr. V.P. Patel, Secretary, Legal Department, Government of Gujarat
(v) Mr. Suresh N. Shelat, Sr. Advocate, High Court of Gujarat.
9.11 The recommendations of the aforesaid members of the Committee were to be placed before the Visitor.
9.12 In the 11th Meeting of the General Council held on 16.11.2013, the issue of conversion was not discussed. However, in the 12th Meeting of the General Council held on 16.02.2014, it was resolved that the Committee dealing with the issue of conversion shall finalize the matter before the end of April, 2014 and shall place its recommendation before the Visitor for his consideration and approval.
Page 32 of 62HC-NIC Page 32 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT 9.13 On 14th February, 2015, the report of the Committee appointed at the 10th General Council meeting was placed before in the 13th meeting of the General Council, where, two new members were inducted for finalization of rules and regulations. On 19th March, 2015 also, the resolution, in respect of the permanent appointment indicates that subject regulation was under consideration.
9.14 As mentioned herein above, the Visitor of the GNLU and Hon'ble Mr. Justice Mr. T.S. Thakur, Judge Supreme Court of India (as His Lordship then was), remarked that by way of circulation, it is not desirable to get the approval of the proposed rules and regulations and in the next meeting, this being an important subject, should be placed. At the 30th meeting of the Executive Council, it had been resolved that the issue of conversion of contractual employees into the permanent employees on teaching and non- teaching posts which was under consideration of the General Council and the contract of the employees be extended, therefore, till further notice.
9.15 In the 14th meeting of the General Council held on 27.02.2016, the Committee, which was expanded on 14.02.2015 inducting two new Page 33 of 62 HC-NIC Page 33 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT members, submitted its report and suggestions amended to the regulations and the report of recommendations of the Committee was approved as a whole. Although, its employees', whose contractual period was getting over, were issued the notice. The petitioners, herein, were also given the notice ending their contractual appointment with effect from 01.03.2016. A representation, of course, was made by the employees of the GNLU requesting to withdraw the notice dated 31.05.2016 and to regularize their services. They also made representation before His Lordship the Hon'ble Mr. Justice, Abhay Manohar Sapre, Judge of the Supreme Court of India, requesting His Lordship to put on hold the recommendations of the Permanency Committee.
9.16 However, the GNLU chose to issue a fresh public advertisement on 16.03.2016, as per the amended regulations. On 17.03.2016, the response of the GNLU was to put an end to the services of the petitioners on 31.05.2016. The GNLU offered an opportunity to the petitioners to apply and get selected on merits on the permanents posts to enable the petitioners to be regularized. It had been specified that those, who would not be selected, their services shall come to an end and or till the new incumbent takes the charge.
Page 34 of 62HC-NIC Page 34 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT 9.17 Undoubtedly, various representations have been made by the petitioners relying on the one member Committee of Prof. Bakul Dholakia, former Director of Indian Institute of Management, Ahmedabad, made in November, 2013, for regularization, as mentioned herein before. Undoubtedly, the Council in the 13th General Meeting held on 14.02.2015, also resolved that the Committee entrusted to examine the issue of conversion of contractual appointments into permanent appointments of eligible teaching and non-teaching staff of the GNLU must study the system prevailing in the other law universities and frame the rules, which would ensure that the staff appointed against the permanents posts is subject to annual performance review and if, in case, their performance falls short below the prescribed level, the termination of their employment can be made.
9.18 However, the 14th meeting of the General Council held on 27.02.2016, after due deliberation, had approved the report and recommendations of the Committee as a whole, where the GNLU decided to conduct recruitment of the teaching and non-teaching staff against the permanent posts through fresh advertisement in consonance with the rules and regulations prescribed by the GNLU and the Government of Page 35 of 62 HC-NIC Page 35 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Gujarat for both teaching and non-teaching staff, respectively. There cannot be such consideration in the Executive Council meeting or in the General Council meeting about making contractual employees permanent. Of course, on completion of initial period of probation, the petitioners and the others continued to discharge their duties and certain legitimate expectations also arose in the year 2012, particularly, when the subject of conversion of contractual appointments into permanent appointments was in active consideration of both the Committees and the Executive Council passed the resolution on 15.09.2012. Nonetheless, the report, which eventually was to be approved by the General Council was not done.
9.19 On 27.02.2016, in the 14th General Council meeting was of acceptance of the recommendations of the Committee, which was expanded by including even the legal experts. The fresh recruitment not only had been advertised, but, the petitioners also participated in to the same. The fact remains that on their failure to succeed in the examination the petitioners have approached this Court. The representations made in wake of the acceptance of the report of the Committee was only under consideration by the authority Page 36 of 62 HC-NIC Page 36 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT concerned. Although, those candidates, who have once participated in the process of recruitment, are precluded to challenge such process of recruitment.
9.20 The Apex Court in the case of 'MADRAS INSTITUTE OF DEVELOPMENT STUDIES AND ANOTHER V. DR.K. SIVASUBRAMANIYAN AND OTHERS', while dealing with Civil Appeal No.6465 of 2015, frowned upon such litigants, who chose to challenge after having participated in the process, holding thus:
20. The question as to whether a person who consciously takes part in the process of selection can turn around and question the method of selection is no longer res integra.
9.21 Further, in 'DR. G. SARANA VS. UNIVERSITY OF LUCKNOW & ORS.', (1976) 3 SCC 585, a similar question came for consideration before a three Judges Bench where the petitioner had applied to the post of Professor of Athropology in the University of Lucknow. On his failure to get appointed, he had approach the High Court pleading bias against him of the three experts in the Selection Committee consisting of five members. He also doubted in the constitution of the Committee. Rejecting all such contentions, the Apex Court held:-Page 37 of 62
HC-NIC Page 37 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT "15. We do not, however, consider it necessary in the present case to go into the question of the reasonableness of bias or real likelihood of bias as despite the fact that the appellant knew all the relevant facts, he did not before appearing for the interview or at the time of the interview raise even his little finger against the constitution of the Selection Committee. He seems to have voluntarily appeared before the committee and taken a chance of having a favourable recommendation from it. Having done so, it is not now open to him to turn round and question the constitution of the committee. This view gains strength from a decision of this Court in Manak Lals case where in more or less similar circumstances, it was held that the failure of the appellant to take the identical plea at the earlier stage of the proceedings created an effective bar of waiver against him. The following observations made therein are worth quoting:
"It seems clear that the appellant wanted to take a chance to secure a favourable report from the tribunal which was constituted and when he found that he was confronted with an unfavourable report, he adopted the device of raising the present technical point."
"
9.22 The petitioners, of course, would say Page 38 of 62 HC-NIC Page 38 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT that even before entering into the arena of examination, then reserved their right to challenge the process by specifying that such participation in the process of recruitment would not prejudice their right to challenge. This act on the part of the petitioners also would not in any manner help their cause nor would it make them immune from the findings and observations of the Apex Court referred herein above.
9.23 Uncontrovertedly, the initial appointment of the petitioners had been on contractual basis in 2006, 2004 and 2004 respectively which was, thereafter, extended in case of all the petitioners. They did possess requisite qualifications when their appointments were made. It was by a process of selection, which was admissible under the rules that their selection had been made on respective posts. The petitioner, still, were fully aware that they were on contractual appointments. All their attempts and efforts so also their representation for making them permanent were under active consideration. Undisputedly, the report of the committee, as accepted in the 14th meeting of the General Council held on 27.02.2016, had put a seal of approval on such a report and it was decided that all the permanent posts were to be filled-up by the public advertisement by a fresh Page 39 of 62 HC-NIC Page 39 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT advertisement in conformity with the regulations and the norms prescribed by the GNLU so also as prescribed by the Government of Gujarat for teaching and non-teaching staff, respectively.
9.24 In above view of the matter to insist on being made permanent and to challenge the action of the Respondent authority for terminating their services, in the opinion of this Court, is not a challenge, which can be sustained. There is nothing to show that the action is either unreasonable or unfair or discriminatory in any manner. Although, some of the employees, who were on contractual basis served with the petition have succeeded in the examination, which had been conducted pursuant to the issuance of public advertisement on acceptance of the report of the Committee recommending amendments in the regulations by the General Council. These are only three petitioners, who, unfortunately, could not sail that can be termed as fortuitous circumstances.
9.25 The Apex Court in the case of 'GRIDCO LIMITED AND ANOTHER VS. SADANANDA DOLOI AND OTHERS' (2011) 15 SCC 16, was considering the case of the appellant-Corporation, which terminated services of Respondent No.1 by issuing a notice and making payment of three months' Page 40 of 62 HC-NIC Page 40 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT salary, as stipulated in the contract. The issues for consideration before the Apex Court were:
(1) What was the true nature of the appointment of the respondent? In Particular, was the appointment regular or simply contractual in nature? And (2) If the appointment was contractual, was the termination thereof vitiated by any legal infirmity to call for interference under Article 226 of the Constitution?
9.26 The Apex Court held that the power to make a contractual employment is implicit in the power to make a permanent appointment, unless the statute under which the authority exercises its powers and discharges its functions or the Rules & Regulations governing recruitment under the authority specifically forbid the making of such an appointment. The Apex court did not find any such prohibition in the case before it. At the relevant point of time, the rules did not provide for making a contractual employment, as was argued before the Apex Court, which was not held Page 41 of 62 HC-NIC Page 41 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT to be a good reason for the appointment made on contractual basis to hold as constituting the breach of the rules or that such appointment had to be necessarily treated as a regular appointment. The Court also examined the details of facts to hold that the nature of appointment, from the totality of the facts and circumstances, can be said to be contractual and not regular.
9.27 The Apex Court also examined the scope of the judicial review in the transactions of the government to hold that this can extend to contractual transaction of government, but, where it is perverse. Interference is not possible simply on the ground of reasonableness or availability of alternatives. Such actions can be challenged under the public law obligations and compliance required by Article 14 of the Constitution of India. It, further, held that interference is permissible, where the action of the authority is mala fide, arbitrary, unfair or unreasonable or n such a outrageous defiance of the logic that the person taking decision can be said to have taken leave of his senses. The question of facts and reappraisal of evidence in contractual employments, touching the question of performance and the need of the incumbent in the post is not maintainable even while exercising powers under Article 136 of the Constitution of Page 42 of 62 HC-NIC Page 42 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT India. Some of the relevant findings and observations of the Apex Court are profitably reproduced:
"22. This question has to be answered in two distinct parts. The first part relates to the aspect whether the order passed by the appellant-Corporation is amenable to judicial review and if so what is the scope of such review. The second part of the question is whether on the standards of judicial review applicable to it, the order of termination is seen to be suffering from any legal infirmity. Before we refer to certain decisions of this Court that have dealt with similar issues in the past we may at the outset say that there was no challenge either before the High Court or before us as to the competence of the authority that passed the termination order.
23. There was indeed a feeble argument that the order was mala fide in character but having regard to the settled legal position regarding the proof of mala fides and the need for providing particulars to substantiate any such plea, we are of the view that the charge of mala fide does not stand scrutiny. Neither before the learned Single Judge nor before the Division Bench was the ground based on mala fides seriously argued by the respondent. What was contended on behalf of the respondent was that the appellant-Corporation did not Page 43 of 62 HC-NIC Page 43 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT act fairly and objectively in taking the decision to terminate the arrangement.
24. It was contended that the decision to terminate the contractual employment was not a fair and reasonable decision having regard to the fact that the respondent had performed well during his tenure and the requirement of the Corporation to have a Chief General Manager (HR) continued to subsist. In substance, the contention urged on behalf of the respondent was that this Court should reappraise and review the material touching the question of performance of the respondent as Chief General Manager (HR) as also the question whether the Corporation's need for a General Manager (HR) had continued to subsist. We regret our inability to do so.
25. It is true that judicial review of matters that fall in the realm of contracts is also available before the superior courts, but the scope of any such review is not all pervasive. It does not extend to the Court substituting its own view for that taken by the decision-making authority. Judicial review and resultant interference is permissible where the action of the authority is mala fide, arbitrary, irrational, disproportionate or unreasonable but impermissible if the petitioner's challenge is based only on the ground that the view Page 44 of 62 HC-NIC Page 44 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT taken by the authority may be less reasonable than what is a possible alternative. The legal position is settled that judicial review is not so much concerned with the correctness of the ultimate decision as it is with the decision-making process unless of course the decision itself is so perverse or irrational or in such outrageous defiance of logic that the person taking the decision can be said to have taken leave of his senses.
26. In Shrilekha Vidyarthi & Ors. vs. State of UP, (1991) 1 SCC 212, the State Government had by a circular terminated the engagement of all the government counsels engaged throughout the State and sought to defend the same on the ground that such appointments being contractual in nature were terminable at the will of the government. The question of reviewability of administrative action in the realm of contract was in that backdrop examined by this Court. The Court also examined whether the personality of the State Government undergoes a change after the initial appointment of government counsels so as to render its action immune from judicial scrutiny. The answer was in the negative.
27. The Court held that even after the initial appointment had been made and even when the matter is in the realm of contract, the State could not cast off its personality Page 45 of 62 HC-NIC Page 45 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT and exercise a power unfettered by the requirements of Article 14 or claim to be governed only by private law principles applicable to private individuals. The Court observed:
"20... we are also clearly of the view that this power is available even without that element on the premise that after the initial appointment, the matter is purely contractual. Applicability of Article 14 to all executive actions of the State being settled and for the same reason its applicability at the threshold to the making of a contract in exercise of the executive power being beyond dispute, can it be said that the State can thereafter cast off its personality and exercise unbridled power unfettered by the requirements of Article 14 in the sphere of contractual matters and claim to be governed therein only by private law principles applicable to private individuals whose rights flow only from the terms of the contract without anything more? We have no hesitation in saying that the personality of the State, requiring regulation of its conduct in all spheres by requirements of Article 14, does not undergo such a radical change after the making of a contract merely because some contractual rights accrue to Page 46 of 62 HC-NIC Page 46 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT the other party in addition. It is not as if the requirements of Article 14 and contractual obligations are alien concepts, which cannot co-exist."
28. Recognizing the difference between public and private law activities of the State, this Court reasoned that unlike private individuals, the State while exercising its powers and discharging its functions, acts for public good and in public interest. Consequently every State action has an impact on the public interest which would in turn bring in the minimal requirements of public law obligations in the discharge of such functions. The Court declared that to the extent, the challenge to State action is made on the ground of being arbitrary, unfair and unreasonable hence offensive to Article 14 of the Constitution, judicial review is permissible. The fact that the dispute fell within the domain of contractual obligations did not, declared this Court, relieve the State of its obligation to comply with the basic requirements of Article 14.
29. The court said: (Shrilekha Vidyarthi case, SCC pp. 236-37, para
22) "22... This factor alone is sufficient toc import at least the minimal requirements of public law obligations and impress with this character the Page 47 of 62 HC-NIC Page 47 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT contracts made by the State or its instrumentality. It is a different matter that the scope of judicial review in respect of disputes falling within the domain of contractual obligations may be more limited and in doubtful cases the parties may be relegated to adjudication of their rights by resort to remedies provided for adjudication of purely contractual disputes. However, to the extent, challenge is made on the ground of violation of Article 14 by alleging that the impugned act is arbitrary, unfair or unreasonable, the fact that the dispute also falls within the domain of contractual obligations would not relieve the State of its obligation to comply with the basic requirements of Article
14. To this extent, the obligation is of a public character invariably in every case irrespective of there being any other right or obligation in addition thereto.
An additional contractual obligation cannot divest the claimant of the guarantee under Article 14 of non-arbitrariness at the hands of the State in any of its actions."
(emphasis supplied)
30. In Assistant Excise Commissioner & Ors. V. Issac Peter & Ors., (1994) 4 SCC 104, the dispute related to supply of additional quantities of arrack demanded by the license-
Page 48 of 62 HC-NIC Page 48 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT holder. Supply of arrack was, however, controlled by the Government and the entire
transaction relating to the supply and sale of arrack was based on licenses granted under the relevant rules to persons who emerged successful in a public auction. The Government claimed that the only obligation cast upon it under the Rules was to provide the monthly quota of arrack to each license-
holder, supply of additional quantity being discretionary with the authorities. The license-
holders, on the other hand, argued that supply of additional quantity was implicit in the conditions of the license. In support they relied upon the past practice and argued that if the supply is limited to the monthly quota only it would not be possible for the license holder to pay even the license fee. The license-holders questioned the refusal of the State Government to issue additional quantities of arrack as unfair and unreasonable. This court, however, rejected that contention and held: (Issac Peter case, SCC p.124, para 26) "26. ...Doctrine of fairness or the duty to act fairly and reasonably is a doctrine developed in the administrative law field to ensure the Rule of Law and to prevent failure of justice where the action is administrative in nature. Just as principles of natural justice ensure fair decision where the function is quasi-
Page 49 of 62HC-NIC Page 49 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT judicial, the doctrine of fairness is evolved to ensure fair action where the function is administrative. But it can certainly not be invoked to amend, alter or vary the express terms of the contract between the parties. This is so, even if the contract is governed by statutory provisions, i.e., where it is a statutory contract - or rather more so."
(emphasis supplied)
31. Taking note of the decision of this Court in Shrilekha Vidyarthi's case (supra), this court held that there was no room for invoking the doctrine of fairness and reasonableness against one party to the contract, for the purpose of altering or adding to the terms and conditions of the contract merely because it happens to be the State. The Court said : (Issac Peter case, SCC p.124, para 26) "It was a case of termination from a post involving public element. It was a case of non-
government servant holding a public office, on account of which it was held to be a matter within the public law field. This decision too does not affirm the principle now canvassed by the learned Counsel (that being of incorporating the doctrine of fairness in contracts where State is a party). We are, therefore, of the opinion that Page 50 of 62 HC-NIC Page 50 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT in case of contracts freely entered into with the State, like the present ones, there is no room for invoking the doctrine of fairness and reasonableness against one party to the contract (State), for the purpose of altering or adding to the terms and conditions of the contract, merely because it happens to be the State. In such cases, the mutual rights and liabilities of the parties are governed by the terms of the contracts (which may be statutory in some cases) and the laws relating to contracts. It must be remembered that these contracts are entered into pursuant to public auction, floating of tenders or by negotiation.
There is no compulsion on anyone to enter into these contracts. It is voluntary on both sides."
(emphasis supplied)
32. In conclusion, the Court made it clear that the opinion expressed by it was only in the context of contracts entered into between the State and its citizens pursuant to public auction, floating of tenders or by negotiation. The court considered it unnecessary to express any opinion about the legal position applicable to contracts entered into otherwise than by public auction, floating of tenders or negotiation.
33. In State of Orissa V. Chandra Page 51 of 62 HC-NIC Page 51 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Sekhar Mishra, (2002) 10 SCC 583, the respondent had been appointed as a Homeopathic Medical Officer whose services were subsequently terminated by issue of a notice.
While rejecting the challenge to the termination order, the Court observed: (SCC p. 583, para 4) "4... when the respondent was only a contractual employee, there could be no question of his being granted the relief of being directed to be appointed as a regular employee."
34. We may also refer to the decision of this court in Satis Chandra Anand V. Union of India, (AIR 1953 SC 250), where the petitioner, an employee of the Directorate General of Resettlement and Employment, was removed from contractual employment after being served a notice of termination. The contract of service in that case was initially for a period of five years which was later extended. A five- Judge Bench hearing the matter, dismissed the petition, challenging the termination primarily on the ground that the petitioner could not prove a breach of a fundamental right since no right accrued to him as the whole matter rested in contract and termination of the contract did not amount to dismissal, or removal from service nor was it a reduction in rank. The Court found it to be an ordinary case of a contract being terminated by notice under one of its clauses.
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35. The Court observed : (Satish Chandra Case, AIR p.252, para 10-11) "10. There was no compulsion on the Petitioner to enter into the contract he did. He was as free under the law as any other person to accept or reject the offer which was made to him.
Having accepted, he still had open to him all the rights and remedies available to other persons similarly situated to enforce any rights under his contract, which has been denied to him, assuming there are any, and to pursue in the ordinary Courts of the land, such remedies for a breach as are open to him to exactly the same extent as other persons similarly situated. He has not been discriminated against and he has not been denied the protection of any laws which others similarly situated could claim...
11. ... The Petitioner has not been denied any opportunity of employment or of appointment.
He has been treated just like any other person to whom an offer of temporary employment under these conditions was made. His grievance when analysed, not one of personal differentiation but is against an offer of temporary employment on special terms as opposed to permanent employment. But of course the Page 53 of 62 HC-NIC Page 53 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT State can enter into contracts of temporary employment and impose special terms in each case, provided they are not inconsistent with the Constitution, and those who chose to accept those terms and enter into the contract are bound by them, even as the State is bound."
(emphasis supplied)
36. In Parshotam Lal Dhingra v.
Union of India (AIR 1958 SC 36), this court followed the view taken in Satish Chandra's case (supra). Any reference to the case law on the subject would remain incomplete unless we also refer to the decision of the Constitution Bench of this court in Delhi Transport Corporation v. D.T.C. Mazdoor Congress & Ors., (1991) supp (1) SCC 600, where this Court was dealing with the constitutional validity of Regulation 9 (b) that authorized termination on account of reduction in the establishment or in circumstances other than those mentioned in clause (a) to Regulation 9 (b) by service of one month's notice or pay in lieu thereof. Sawant, J. in his concurring opinion held that the provision contained the much hated rules of hire and fire reminiscent of the days of laissez faire and unrestrained freedom of contract and that any such rule would have no place in service conditions.
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37. To the same effect was an earlier decision of this Court in Central Inland Water Trnasport Coporation Ltd. & Anr. V. Brojo Nath Ganguly & Anr. (1986) 3 SCC 156, where the Court had refused to enforce an unfair and unreasonable contract or an unfair and unreasonable clause in a contract entered into between parties who did not have equal bargaining power.
38. A conspectus of the pronouncements of this court and the development of law over the past few decades thus show that there has been a notable shift from the stated legal position settled in earlier decisions, that termination of a contractual employment in accordance with the terms of the contract was permissible and the employee could claim no protection against such termination even when one of the contracting parties happened to be the State. Remedy for a breach of a contractual condition was also by way of civil action for damages/compensation. With the development of law relating to judicial review of administrative actions, a writ Court can now examine the validity of a termination order passed by public authority. It is no longer open to the authority passing the order to argue that its action being in the realm of contract is not open to judicial review.
39. A writ Court is entitled to judicially review the action and Page 55 of 62 HC-NIC Page 55 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT determine whether there was any illegality, perversity, unreasonableness, unfairness or irrationality that would vitiate the action, no matter the action is in the realm of contract. Having said that we must add that judicial review cannot extend to the Court acting as an appellate authority sitting in judgment over the decision. The Court cannot sit in the arm chair of the Administrator to decide whether a more reasonable decision or course of action could have been taken in the circumstances. So long as the action taken by the authority is not shown to be vitiated by the infirmities referred to above and so long as the action is not demonstrably in outrageous defiance of logic, the writ Court would do well to respect the decision under challenge.
40. Applying the above principles to the case at hand, we have no hesitation in saying that there is no material to show that there is any unreasonableness, unfairness, perversity or irrationality in the action taken by the Corporation. The Regulations governing the service conditions of the employees of the Corporation, make it clear that officers in the category above E-9 had to be appointed only on contractual basis.
41. It is also evident that the renewal of the contract of employment depended upon the perception of the management as to Page 56 of 62 HC-NIC Page 56 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT the usefulness of the respondent and the need for an incumbent in the position held by him. Both these aspects rested entirely in the discretion of the Corporation. The respondent was in the service of another employer before he chose to accept a contractual employment offered to him by the Corporation which was limited in tenure and terminable by three months' notice on either side. In that view, therefore, there was no element of any unfair treatment or unequal bargaining power between the appellant and the respondent to call for an over-sympathetic or protective approach towards the latter.
42. We need to remind ourselves that in the modern commercial world, executives are engaged on account of their expertise in a particular field and those who are so employed are free to leave or be asked to leave by the employer. Contractual appointments work only if the same are mutually beneficial to both the contracting parties and not otherwise."
9.28 Following the dictum of the said judgment, it can be said that the judicial review even when available to this Court under Article 226 of the Constitution of India, the scope of such review is not of substituting the view of this Court for the view that is taken by the Page 57 of 62 HC-NIC Page 57 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT decision making authority. Unless the action of the authority is arbitrary, irrational, mala fide or unreasonable, interference is impermissible. The decision making process is far more important than the ultimate decision and the decision also unless is perverse or in outrageous defiance of the logic, the same is not required to be reviewed.
10.0 Examining the facts of this case by the standards laid down by the Apex Court in the aforesaid authority and those settled under the law, the decision of terminating the contractual employments of all the three petitioners, who had been working since the year 2006, 2004 and 2004 respectively, cannot be said to be mala fide or arbitrary. Admittedly, when the petitioners were taken-up on contractual employment, they were appointed on contractual terms. The petitioners also were well aware that their appointments being contractual in nature and were terminable on giving notice of a particular period on either side and also at the end of certain period. The Performance Management Appraisal System (for short, 'PAMS') has rated them well. It is, of course, emphasized on the part of the petitioners that their performance at no stage had been questioned nor was their assessment any less competitive. It is the policy level decision of Page 58 of 62 HC-NIC Page 58 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT the GNLU to fill-up the permanent posts, without converting contractual appointment to permanent appointment, which has been challenged in this petition.
11. Of course, one of the arguments on their part is of having served for about 10 years in contractual appointment can give rise to legitimate expectations to be made permanent. The writ Court is not to judicially review the action, but, it needs to consider, whether the action is illegal, perverse or unreasonable and unfair.
12.0 A report of the committee entrusted to examine the issue of contractual appointment into permanent appointment of eligible teaching and non-teaching staff against the permanent posts was tendered to the Executive Council. The Circular resolution for ratification of the GNLU regulation Nos. 15(5) and 17(6) concerning employment duration was addressed to the members of the General Council. Thus, the Executive Council in its 19th Meeting held on 04.10.2011 adopted the policy for conversion of contractual employment into permanent ones and the same was approved by the Executive Council in its 21st meeting (II Session) held on 31.05.2012. This draft resolution when was addressed to the Page 59 of 62 HC-NIC Page 59 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT Members of the General Council, which is the Apex body and without whose approval, no amendment can take place was not approved by the General Council with a specific direction to the Director of the GNLU that unless the facts and figures of the existing contractual employment and future permanent employment and other incidental aspects are concerned in the context of the financial burden, which may fall upon the GNLU by Circular Resolution, it is not possible to decide. Thus, the Executive Council, undoubtedly, was in favour of conversion of the contractual appointment into permanent appointment on the basis of the needs of the university, performance record and other criteria, as were prescribed by the Executive Council from time to time. However, when the General Council had chosen to hand over the task to the Committee and there was no approval of the amended Regulation Nos. 15(5) and 17(6) of the GNLU, and therefore, it will not be possible for this Court, either on the strength of regulations or the principles of legitimate expectations or on the ground of continuity in service of all these years, to hold the action of the authority arbitrary or unjust.
13.0 Undoubtedly, the Executive Council by its resolution gave a hope to all those who were in contractual appointments and some of the Page 60 of 62 HC-NIC Page 60 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT reports of review commission of Dr. Dholakia and of UGC insisted on making the contractual staff regularized. There is of course no complaint of their not meeting the criteria set out in the regularisation and yet, the fact remains that the Regulations are made in the year 2009. So as to avail opportunity to all others against permanent posts, General Council apply a well considered report of committee chose to make it wider and preferred to take recourse of public advertisement for filling-up those posts and that surely cannot be termed as an unfair or discriminatory act.
14.0 This Court, therefore, is of the opinion that the doctrine of fairness and the legitimate expectations, as sought to be advanced, cannot be stretched to an extent that to amend or alter the terms of a contract between the parties. As held in the case of 'SHRILEKHA VIDYARTHI & ORS. VS. STATE OF UP', (1991) 1 SCC 212, the doctrine of fairness and reasonableness cannot be invoked against one party to the contract for the purpose of altering or adding to the terms of the contract merely because, it happens to be the State and here the University. There was absolutely no compulsion on the petitioners to enter into the contract. It is not their case that they have been denied any opportunity of Page 61 of 62 HC-NIC Page 61 of 62 Created On Sun Aug 13 10:19:52 IST 2017 C/SCA/6296/2016 CAV JUDGMENT employment. Like other employees, they have been treated equally.
15.0 In the result, this petition fails and is DISMISSED. However, the petitioners, if they so choose, are permitted to make once again their representation before the Director, who may place the same with all the details before the General Council for it to regard sympathetically the plea of regularisation as none of the representations made so far has been replied to so also for considering their individual circumstances and length of service. Outcome of the same shall not, if not favourable, give any fresh cause to the petitioners.
16.0 At this stage, learned Counsel appearing for the petitioners, Mr. Pujara, makes a request for continuing interim protection to which the other side has a strong objection.
16.1 In view of the fact that the interim relief has been continued till date, the same needs to be continued for a further period of four weeks from today to enable the petitioners to approach the higher forum.
(MS SONIA GOKANI, J.) UMESH Page 62 of 62 HC-NIC Page 62 of 62 Created On Sun Aug 13 10:19:52 IST 2017