Gujarat High Court
Dhrumaben K Desai vs State Of Gujarat & 2 on 3 August, 2016
Author: J.B.Pardiwala
Bench: J.B.Pardiwala
C/SCA/7138/2002 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 7138 of 2002
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE J.B.PARDIWALA
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1 Whether Reporters of Local Papers may be allowed to see YES
the judgment ?
2 To be referred to the Reporter or not ? YES
3 Whether their Lordships wish to see the fair copy of the NO
judgment ?
4 Whether this case involves a substantial question of law as NO
to the interpretation of the Constitution of India or any
order made thereunder ?
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DHRUMABEN K DESAI....Petitioner(s)
Versus
STATE OF GUJARAT & 2....Respondent(s)
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Appearance:
MR BB GOGIA, ADVOCATE for the Petitioner(s) No. 1
MS KAJAL L KALWANI, ADVOCATE for the Petitioner(s) No. 1
MS MUSKAN A GOGIA, ADVOCATE for the Petitioner(s) No. 1
MR KARTIK PARIKH, AGP for the Respondent(s) No. 1 2
RULE SERVED for the Respondent(s) No. 3
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CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA
Date : 03/08/2016
ORAL JUDGMENT
1. By this writapplication under Article 226 of the Constitution of India, the writapplicant - a former employee of the State Government Page 1 of 24 HC-NIC Page 1 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT has prayed for the following reliefs: 17(A) to issue a writ of mandamus or in the nature of mandamus or any other appropriate writ, order or direction and quash and set aside the impugned order, AnnexureA passed by the respondent no.2 terminating the services of the petitioner.
(B) to issue a writ of mandamus or in the nature of mandamus or any other appropriate writ order or direction and direct the respondents to reinstate the petitioner with 100% back wages.
(C) Pending admission and final disposal of this petition, be pleased to direct the respondents to reinstate the petitioner with 100% back wages.
Alternative Pending admission and final disposal of this petition, be pleased to direct the respondents for not appointing any person on the post of coordinator, librarian in respondent no.3 committee.
(D) to pass such other and further orders as may be deemed fit.
2. The case of the writapplicant may be summarized as under: 2.1 The writapplicant was appointed as a Substitute Librarian in the year 1985 with the respondent no.3 - Jawaharlal Nehru Memorial Committee, Gujarat. She was appointed thereafter on 01/06/1988 on the post of Librarian on the adhoc basis. On 30/04/1994 she came to be promoted on the post of the Coordinator and the additional charge of the Librarian was also assigned to her.
2.2 The Jawaharlal Nehru Memorial Committee is a society. The Memorandum of Association of the Committee is as under: JAWAHARLAL NEHRU MEMORIAL COMMITTEE, GUJARAT MEMORANDUM OF ASSOCIATION In the matter of Act XXI of 1860 being Act for the Registration of Literary, Scientific and Charitable Societies.
AND
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C/SCA/7138/2002 JUDGMENT
In the matter of Jawaharlal Nehru Memorial Committee, Gujarat.
1. The name of the Society is:
Jawaharlal Nehru Memorial Committee, Gujarat, here in after referred to as the "Committee".
2. The office of the Committee will be situated at Gandhinagar or Ahmedabad.
3. The Committee shall consist of the members of the Gujarat State Regional Committee, Shri Jawarharlal Nehru Memorial Fund, appointed by the Government of Gujarat under its resolution No.MIS/ 107284115 (74) - Bdated 30974, and a subsequent GR No.M/S 10721027B dated 17775, Education and Labour Deptt., for a period of three years.
3a. On the expiry of the term of the present Committee, the Government of Gujarat shall appoint a fresh Committee as per rule No.2 of the Rules and Regulations annexed herewith.
4. The objects of the Committee are:
To afford opportunities to children for education through recreation, visual aids and physical activities, to promote social and cultural contacts amongst children of all classes and communities, to inculcate such values as would help and develop a modern Indian personality with a scientific tamper and develop this activity as a movement.
5. The Committee may undertake all or any of the following activities to fulfill the above objects as mentioned in the activities such as:
(i) to establish and maintain the State level Bal Bhavan at Ahmedabad and District level Bal Bhavans at District head quarters in the State of Gujarat.
(ii) to establish and maintain children's museum in Ahmedabad and other districts of the State and to operate suitable programme of training and research in order to promote education of children through visual aid.
(iii) to receive grants, subscriptions and donation for the purposes of the Committee provided such subscriptions or donations are not inconsistent with the objects of the Committee and are not in conflict with the satisfactory running of the working of the Committee.
(iv) to deal with funds only for the objects of the Committee.Page 3 of 24
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(v) to determine the number, category and grade of pay and posts, to create, suspend, abolish or retrench the post, or posts and to fix the emoluments and terms of services of the employee or employees of the Committee.
(vi) to appoint any person as attorney of the Committee either to execute instruments or to transact any business of the Committee with such powers as the Committee may deem fit.
(vii) to sell, lease, exchange or otherwise transfer all or any portion of the properties and assets of the Committee with or without consideration subject to prior written permission of the Government of Gujarat.
(viii) to make rules and regulations for the conduct of the meeting and the affairs of the Committee and/or to adopt the same from time to time.
(ix) to do all and such other acts or things as may directly, indirectly or incidentally be beneficial to the carrying out of attainment or the enlargement of the objects of the Committee in confirmity with all or any of its provisions and regulations.
6. The income, funds and properties of the committee will be applied towards maintenance, upkeep and improvement of the Institution and for the promotion of all or any of the objects of the Committee as set forth in this Memorandum, subject to such limitations which might be imposed upon the Committee. No portion of the income, funds and the properties of the Committee shall be either paid or transferred directly or indirectly by way of dividends, bonus or otherwise, howsoever by way of profit to the persons who at any time are or have been the members of the Committee or to any of them or to any person claiming through them or any of them, provided that nothing herein shall prevent payment of remuneration in good faith to any member of the Committee or other persons in the return of any service which may be actually rendered by any member of the Committee or any of them, but shall be dealt with in such manner as the Government of Gujarat may determine.
2.3 It appears that after having put in 15 years of continuous service, all of a sudden, one fine day, she was served with an order of termination, which is at Page15, AnnexureA to this writapplication. The only thing that has been stated in the impugned order is that considering the administrative convenience, the services of the writ Page 4 of 24 HC-NIC Page 4 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT applicant were being terminated.
2.4 Being dissatisfied, she has preferred the present writapplication.
3. The learned counsel appearing for the writapplicant submitted that the impugned order is erroneous and deserves to be quashed and set aside. According to the learned counsel, although his client was appointed on adhoc basis yet she could not have been removed from the service all of a sudden by passing a cryptic order. No opportunity of hearing was given and when she was on a leave, the impugned order came to be passed. The learned counsel further pointed out that the writapplicant was promoted on the post of the Coordinator and was also holding the charge of the Librarian since 01/06/1988. According to the learned counsel, the action could be said to be a violative of Article 14 and 16 of the Constitution of India. In such circumstances referred to above, the learned counsel prays that there being merit in this application, the same may be allowed.
4. On the otherhand, this writapplication has been vehemently opposed by Mr. Parikh, the learned AGP appearing for the State Government. The learned AGP laid much stress on the fact that the appointment of the writapplicant was adhoc and at no point of time, she was promised any fulltime employment on the post in question. According to the learned AGP, if the appointment was adhoc then her services could have terminated at any point of time. While taking such decision, the authority was not required to assign any reason for the same.
5. A short reply has been filed on behalf of the respondent no.2, which reads as under:
4. I say that the petitioner, was serving purely on adhoc basis and therefore, because there was not further need of her services for Page 5 of 24 HC-NIC Page 5 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT the post of librarian, she was terminated.
5. I say that as the services of the petitioner were not required and the petitioner was removed from her services, I also say that no one was appointed or taken into service in place of the petitioner for the post in question.
6. I say that the contention of the petitioner that she was promoted to the post of Coordinator, is incorrect, in fact the petitioner was given an additional charge of the post purely temporary and on adhoc basis. The petitioner cannot claim any benefits on the basis of the appointment which was adhoc.
6. Having heard the learned counsel appearing for the parties and having considered the materials on record, the only question that falls for my consideration is whether the authority concerned committed any error in passing the impugned order.
7. The facts of this case reminds me of the observations made by the Supreme Court in the case of Smt. Maneka Gandhi Vs. Union of India and Another reported in AIR 1978 SC 597. The Supreme Court observed as under:
56. Now, the question immediately arises as to what is the requirement of Article 14: What is the content and reach of the great equalising principle enunciated in this article? There can be no doubt that it is a founding faith of the Constitution. It is indeed the pillar on which rests securely the foundation of our democratic republic. And, therefore, it must not be subjected to a narrow, pedantic or lexicographic approach. No attempt should be made to truncate its allembracing scope and meaning, for to do so would be to violate its activist magnitude. Equality is a dynamic concept with many aspects and dimensions and it cannot be imprisoned within traditional and doctrinaire limits. We must reiterate here what was pointed out by the majority in E. P. Royappa v. State of Tamil Nadu (1974) 2 SCR 348: (AIR 1974 SCS 555) namely, that "from a positivistic point of view, equality is antithetic to arbitrariness. In fact equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic, while the other, to the whim and caprice of an absolute monarch. Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is therefore violative of Article 14". Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment. The principle of reasonableness, which legally as well as philosophically, is an essential element of equality or nonarbitrariness pervades Article 14 like a brooding Page 6 of 24 HC-NIC Page 6 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT omnipresence and the procedure contemplated by Article 21 must answer the test of reasonableness in order to be in conformity with Article 14. It must be 'right and just and fair" and not arbitrary, fanciful or oppressive; otherwise, it would be no procedure at all and the requirement of Article 21 would not be satisfied.
How far natural justice is an essential element of procedure established by law.
8. In my view, after put in 15 years of unblemished service and that too, after being promoted on the post of the Coordinator, the services of the writapplicant could not have been terminated in such an arbitrary and highhanded manner. The affidavitinreply is conspicuously silent as to what actually weighed with the authority concerned in taking such decision. Except one word "administrative convenience", nothing further has been stated in the impugned order. I am not impressed by the submission canvassed by the learned AGP that since the appointment of the writapplicant was adhoc, her services could have been put to an end at any point of time. If I accept this argument, the same will amount to ignoring the mandate of the Article 14 of the Constitution of India. This is exactly what has been observed in Maneka Gandhi' Case (Supra). Article 14 strikes at arbitrariness in State action and ensures fairness and equality of the treatment.
9. It was least expected of the respondents to have issued a notice so that the writapplicant could have replied to the same appropriately. When she was on leave behind her back all of a sudden the impugned order came to be passed. If an employee is permitted to continue even on adhoc basis for a period of 15 years an impression is given to such an employee that her services are required and she would be continued. Even the doctrine of legitimate expectation would play some role if not absolutely in the facts of the case. If an employee is in service for 15 years, his/her planning for the family would be accordingly. All of a sudden if the employee is asked to go home considering the administrative convenience, then in my view, it will not stand the test of Page 7 of 24 HC-NIC Page 7 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT reasonableness under Article 14 of the Constitution of India.
10. In the case of E.P. Royappa Vs. State of Tamil Nadi and Anr. 1974(1) S.L.R. 497, a Constitution Bench of the Supreme Court considered the scope of Articles 14 and 16 and laid down the following principles: " Article 16 embodies the fundamental guarantee that there shall be equality of opportunity for all citizens in matters relating to employment or appointment to any office under the State. Though enacted as a distinct and independent fundamental right because of its great importance as a principle ensuring equality of opportunity in Public employment which is so vital to the building up of the new classless egalitarian society envisaged in the Constitution, Article 16 is only an instance of the application of the concept of equality enshrined in Article 14. In other " words, Article 14 is the genus while Article 16 is a species. Article 16 gives effect to the doctrine of equality in all matters relating to public employment. The basic principle which, there informs both Articles 14 and 16 is equality and inhibition against discrimination. Now, what is the content and reach of this great equalising principle? It is a founding faith, to use the words of Bose, J. "a way of life", and it must not be subjected to a narrow pedantic or lexicographic approach. We cannot countenance any attempt to truncate its all embracing scope and meaning, for to do so would be to violate its activist magnitude. Equality is a dynamic concept with many aspects and dimensions and it cannot be "cribbed, cabined and confined" within traditional and doctrinaire limits. From a positivistic point of view, equality is antithetic to arbitrariness. In fact equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic while the other, to the whim and caprice of an absolute monarch. Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is, therefore, violative of Article 14 and if it affects any matter relating to public employment, it is also violative of Article 16. Article 14 and 16 strikes at arbitrariness in State action and ensure fairness and equality of treatment. They require that State action must be based on valid relevant principles applicable alike to all similarly situate and it must not be guided by any extraneous or irrelevant considerations because that would be denial of equality. Where the operative reason for State action, as distinguished from motive inducing from the antechamber of the mind, is not legitimate and relevant but is extraneous and out side the area of permissible considerations, it would amount to mala fide experience of power and that is hit by Articles 14 and 16. Mala fide exercise of power and arbitrariness are different lethal radiations emanating from the same vide; in fact the latter comprehends the former. Both are inhibited by Articles 14 and 16.
It is also necessary to point out that the ambit and reach of Articles 14 and 16 are not limited to cases where the public servant effected has a right to a post. Even if a public servant is in an officiating position, he can complain of violation of Articles 14 and 16 if he has been arbitrarily or unfairly treated Page 8 of 24 HC-NIC Page 8 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT or subjected to mala fide exercise of power by the State machine. It is, therefore, no answer to the charge of infringement of Articles 14 and 16 to say that the petitioner had no right to the post of Chief Secretary but was merely officiating in that post. That might have some relevance to Article 311 but not Articles 14 and 16."
11. In the case of The Manager Govt. Branch Press and Anr. v. D.B. Belliappa, A.I.R. 1979 S.C. 429, a three judges bench of the Supreme Court held that protection of Articles 14 and 16(1) is available even to a temporary government servant and if the action of the employer is found to be arbitrary or discriminatory, it is liable to be invalidated. While repelling the argument advanced on behalf of the appellant that Articles 14 and 16 do not have any relevance in the matters involving termination of services of temporary employees, their Lordships held as under: "Mr. Veerappa's first contention is that Articles 14 and 16(1) of the Constitution have no application, whatever, to the case of a temporary employee whose service is terminated in accordance with the terms and conditions of his services because the tenure or the duration of the employment of such an employee is extremely precarious being dependent upon the pleasure and discretion of the employerState. In our opinion, no such generalisation can be made. The protection of Articles 14 and 16(1) will be available even to such a temporary Government Servant if he has been arbitrarily discriminated against and singled out for harsh treatment in preference to his juniors, similarly circumstanced. It is true that the competent authority had the discretion under the conditions of service governing the employee concerned to terminate the latters employment without notice. But, such discretion has to be exercised in accordance with reason and fair play and not capriciously. Bereft of rationality and fairness, discretion degenerates into arbitrariness which is the very antithesis of the rule of law on which our democratic polity is founded. Arbitrary invocation or enforcement of a service condition terminating the service of a temporary employee may itself constitute denial of equal protection and offend the equality clause in Articles 14 and 16(1). Article 16(1) guarantees "equality of opportunity for all citizens in matters relating to employment or appointment to any office under the State". Moreover, according to the principle underlying S. 16 of the General Clauses Act, the expression appointment used in Article 16(1) will include termination of or removal from service, also.
12. Dealing with the case of Union of India v. P.K. More, A.I.R. 1962 S.C. 630, the Court observed: Page 9 of 24 HC-NIC Page 9 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT "In Union of India v. P.K. More (A.I.R. 1962 S.C. 630) (Supra) it was contended before this Court that Article 16 provides that there shall be no inquality of treatment in the termination of the service of any employee of the Government. This interpretation of the Article was disputed by the Union of India, who was the appellant in that case. Although the Court thought it unnecessary to pronounce finally on this dispute for the purpose of that case, yet it proceeded on the assumption that Article 16 might be violated by an arbitrary and discriminatory termination of service. In that case, the respondent P.K. More, had been detained legally under a statute. In view of this fact, the court held that "the respondent might legitimately have been put in a separate class and treated differently from others not so detained.
13. The Apex Court then proceeded to examine the case of the respondent and held as under: "In the instant case, no special circumstances or reason has been disclosed which would justify discriminatory treatment to Belliappa as a class apart from his juniors who have been retained in service. Mr. Veerappa's frantic efforts to spell out justification for differential treatment to the respondent by reference to the show cause notice that preceded the impugned action, is entirely futile when the stand adhered to throughout by his client is that there is no nexus between the showcause notice and the impugned action which was taken without any reason in exercise of the power vested in the competent authority under the conditions of the respondents employment. In view of this, we have no alternative, but to hold, that the termination of Billiappas service was made arbitrarily and not on the ground of unsuitability or other reason, which would warrant discriminatory treatment to him as a class apart from others in the same cadre.
In the view we take, we are further fortified by a decision of the Constitution Bench in Champal Lal's case (.A.I.R 1964 S.C. 1854) (supra). That was a case of a temporary Government Servant. Rule 5 governing a temporary servant, which came up for consideration in that case, gave power to the Government to terminate the service of a temporary Government servant by giving him one month's notice or on payment of one month's pay in lieu of notice. This rule was attacked on the ground that it was hit by Article 16. In the alternative, it was urged that even if Rule 5 is good, the order by which the appellant's services were dispensed with, was bad because it was discriminatory. Reference was made to a number of persons whose services were not dispensed with, even though they were junior to the appellant and did not have as good qualifications as he had, Wanchon, J. (as he then was), speaking for the Court, repelled the alternative argument in these terms (at p. 1860).
"We are of the opinion that there is no force in this contention. This is not a case where services of a temporary employee are being retrenched because of the abolition of a post. In such a case a question may arise as to who should be retrenched when one out of several temporary posts is being retrenched in an office. In those circumstances, qualifications and length of service of those holding similar temporary posts may be relevant in considering whether the Page 10 of 24 HC-NIC Page 10 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT retrenchment of a particular employee was as a result of discrimination. The present however is a case where the appellants services were terminated because his work was found to be unsatisfactory.........(in such a case) there can, in our opinion be no question of any discrimination. It would be absurd to say that if the service of one temporary servant is terminated on the ground of unsatisfactory conduct the service of all similar employees must also be terminated along with him, irrespective of what their conduct is. Therefore, even though some of those mentioned in the plaint by the appellant were junior to him and said not have as good qualifications he had and were retained in service, it does not follow that the action taken against the appellant terminating his services was discriminatory, for that action was taken on the basis of his unsatisfactory conduct. A question of discrimination may arise in a case of retrenchment on account of abolition of one of several temporary posts of the same kind in one office but can in our opinion never arise in the case of dispensing with the services of a particular temporary employee on account of his conduct being unsatisfactory."
The principle that can be deduced from the above analysis is that if the services of a temporary Government servant are terminated in accordance with the conditions of his service on the ground of unsatisfactory or for a like reason which marks him off a class apart from other temporary servants who have been retained in service, there is no question of the applicability of Article 16.
Conversely, if the services of a temporary Government Servant are terminated, arbitrarily and not on the ground of his unsustainability, unsatisfactory conduct or the like which would put him in a class apart from his juniors in the same service, a question on unfair discrimination may arise, notwithstanding the fact that in terminating his services, the appointing authority was purporting to act in accordance with the terms of the employment. Where a charge of unfair discrimination is levelled with specificity, or improper motives are imputed to the authority making the impugned order of termination of the service, it is the duty of the authority to dispel that charge by disclosing to the court the reason or motive which impelled it to take the impugned action. Excepting, perhaps, in cases analogous to those covered by Article 311(2), Proviso (c), the authority can not withhold such information from the Court on the lame excuse, that the impugned order is purely administrative and not judicial, having been passed in exercise of its administrative discretion under the rules governing the conditions of the service. "The giving of reasons", as Lord Denning put it in Breen v. Amalgamated Engineering Union, (1971)1 All E.R. 1148 "is one of the Fundamentals of good administration" and to recall the words of this Court in Khudi Ram v. State of West Bengal, (1975)2 S.C.R. 832 at P. 845 :
(A.I.R. 1975 S.C. 550 p. 558) in a Government of laws "there is nothing like unfettered discretion immune from judicial review ability. The executive, no less than the judiciary, is under a general duty to act fairly. Indeed fairness founded on reason is the essence of the guarantee epitomised in Articles 14 and 16(1)."
14. The Court also rejected the contention urged on behalf of the Page 11 of 24 HC-NIC Page 11 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT appellant that the termination of service of the respondent could be justified in view of the conditions contained in the letter of appointment which empowered the employer to dispense with his service without reasons and without notice and observed as under: "Another facet of Mr. Veerappa's contention is that the respondent had voluntarily entered into a contract of service on the terms of employment offered to him. One of the terms of that contract, embodied in the letter of his appointment is that his service was purely temporary and was liable to termination at the will and pleasure of the appointing authority, without reason and without notice. Having willingly accepted the employment on terms offered to him, the respondent cannot complain against the impugned action taken in accordance with those mutually agreed terms. The argument is wholly misconceived. It is borrowed from the archaic common law concept that employment was a matter between the master and servant only. In the first place, this rule in its original absolute form is not applicable to Government servants. Secondly, even with regard to private employment, much of it has passed into the fossils of time. "This rule held the field at the time when the master and servant were taken more literally than they are now and when, as in early Roman Law, the rights of the servant, like the rights of any other member of the household, were not his own but those of his Peter families." The overtones of this ancient doctrine are discernible in the AngloAmerican jurisprudence of the 18th century and the first half of the 20th century, which rationalised the employer's absolute right to discharge the employee, "Such a philosophy", as pointed out by K.K. Mathew J. (vide his treatise: "Democracy, Equality and Freedom", page 326) " of the employer's dominion over his employee may have been in tune with the rustic simplicity of bygone days. But that philosophy is incompatible with these days of large, impersonal, corporate employers." To bring it in tune with vastly changed and changing socioeconomic conditions and mores of the day, much of this old, antiquated and unjust doctrine has been eroded by judicial decisions and legislation, particularly in its application to persons in public employment, to whom the constitutional protection of Articles 14, 15, 16 and 311 is available. The argument is therefore overruled."
15. The Supreme Court in General Manager, Southern Railway Vs. Rangachari, A.I.R. 1962 SC 36, rejected the narrow construction of the expression "matters relating to employment" used in Article 16(1) of the Constitution observing as under: "If the narrow construction of the expression "matters relating to employment" is accepted, it would make the fundamental right guaranteed by Article 16(1) illusory. In that case it would be open to the State to comply with the formal requirements of Article 16(1) by affording equality of opportunity to all citizens in the matter of initial employment and then to defeat its very aim and object by introducing discriminatory provisions in Page 12 of 24 HC-NIC Page 12 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT respect of employees soon after their employment. Would it, for instance, be open to the State to prescribe different scales of salary for the same or similar posts, different terms of leave or superannuation for the same or similar posts? On the narrow construction of Act. 16(1), even if such a discriminatory course is adopted by the State in respect of its employees that would not be violative of the equality of opportunity guaranteed by Article 16(1). Such a result could not obviously have been intended by the Constitution. In this connection it may be relevant to remember that Article 16(1) and (2) really give effect to the equality before law guaranteed by Article 14 and to the prohibition of discrimination guaranteed by Article 15(1). The three provisions form part of the same constitutional code of guarantees and supplement each other. If that be so, there would be no difficulty in holding that the matters relating to employment must include all matters in relation to employment both prior, and subsequent, to the employment which are incidental to the employment and form part of the terms and conditions of such employment,"
The above observations of Rangachari's case (supra) have been relied upon by the three Judges Bench in Belliappa's, case (supra) to hold that the expression "matters relating to employment" includes termination of employment as would appear from the following observations made in paras 18 and 19 of the decision, which are extracted below: "Arbitrary invocation or enforcement of a service condition terminating the service of a temporary employee may itself constitute denial of equal protection and offend the equality clause in Articles14 and 15(1). Article 16(1) guarantees "equality of opportunity for all citizens in matters relating to employment or appointment to any office under the State". Moreover, according to the principle underlying S. 16 of the General Clauses Act, the expression 'appointment' used in Article 16(1) will include termination of or removal from service, also.
It is now well settled that the that the expression "matters relating to employment" used in Article 16(1) is not confined to initial matters prior to the act of employment, but comprehends all matters in relation to employment both prior, and subsequent, to the employment which are incidental to the employment and from part of the terms and conditions of such employment, such as, provisions as to salary, increments, leave, gratuity, pension, age of superannuation, promotion and even termination of employment. It is further well established that Articles14, 15(1) and 16(1) form part of the same constitutional code of guarantees and supplement each other. If any authority is needed for the above enunciation, reference may be made to the observations made by Gajendragadkar, J., as he then was, in General Manager, Southern Railway v. Rangachari, (A.I.R. 1962 S.C. 36) (supra)."
It is interesting to note that O. Chinnappa, J., as he then was, who authored Page 13 of 24 HC-NIC Page 13 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT the judgment of the Full Bench in Y.K. Bhatta's case (supra) was also a member of the two Judges Bench of the Supreme Court in Sengara Singh and Ors. v. The State of Punjab and Ors., A.I.R. 1984 S.C. 1499, in which the dismissal of police personnel was set aside on the ground of violation of Article 14 of the Constitution. The relevant portion of the Judgment in Sengara Singh's case (supra) reads as under : "Now if the in discipline of a large number of personnel amongst dismissed personnel could be condoned or overlooked and after withdrawing the criminal cases against them, they could be reinstated, we see no justification in treating the present appellants differently without pointing out how they were guilty of more serious misconduct or the degree of indiscipline in their case was higher than compared to those who were reinstated. Respondents failed to explain to the Court the distinguishing features and, therefore, we are satisfied in putting all of them in same bracket. On that conclusion the treatment meted to the present appellants suffers from the vice of arbitrariness and Article 14 forbids any arbitrary action which would tantamount to denial of equality as guaranteed by Article 14 of the Constitution. The Court must accordingly interpose and quash the discriminatory action."
In The Managing Director, U.P. Warehousing Corporation and Ors. v. Vijay Narayan Vajpayee, A.I.R. 1980 S.C. 840, which was a case of dismissal from service, O. Chinnappa Reddy, J., in his concurring opinion expressed the view that the rights available to civil servants under Articles 14 and 16 should be extended to the employees of public sector corporation and governmental agencies and observed : "There is no good reason why, if Government is bound to observe the equality clauses of the Constitution in the matter of employment and in its dealings with the employees, the Corporation set up or owned by the Government should not be equally bound and why, instead, such Corporations could become citadels of patronage and arbitrary action. In a country like ours which teems with population, which the State, its agencies, its instrumentalities and its Corporations are the biggest employers and where millions seek employment and security, to confine the applicability of the equality clauses of the Constitution, in relation to matters of employment, strictly to direct employment under the Government is perhaps to mock at the Constitution and the people. Some element of public employment is all that is necessary to take the employee beyond the reach of the Rule which denies him access to a Court to enforce a contract of employment and denies him the protection of Articles 14 and 16 of the Constitution. "
The wide reach of Articles 14 and 16 has been invoked to invalidate the termination of the service of the employees in a large number of cases including the often quoted decisions of Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi, A.I.R. 1975 S.C. 1331 (Constitution Bench); Central Inland Water Transport Corporation Limited and Anr. v. Brojo Nath Ganguly Page 14 of 24 HC-NIC Page 14 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT and Anr., A.I.R. 1986 S.C. 1571; Delhi Transport Corporation v. D.T.C. Mazdoor Congress and Ors., A.I.R. 1991 S.C. 101 (Constitution Bench). In Jarnail Singh and Ors. v. State of Punjab and Ors., 1986(2) S.L.R. 278, a two Judges Bench of the Supreme Court relied on various precedents including the judgment in D.B. Belliappa's case (supra) and held that the termination of the services of a senior person while retaining the junior amounted to violation of Articles 14 and 16 of the Constitution.
No doubt, some of the decisions referred to above relate to permanent employees but the ratio of the law laid down in all these decisions is that if the action of a public employer to terminate the services is found to be arbitrary then it is liable to be invalidated on the ground of violation of Articles 14 and 16 of the Constitution. Thus, it must be treated as a settled proposition of law that Articles 14 and 16 can be invoked by an employee to challenge the termination of his services and the judgment of the Full Bench will have to be read subject to the law laid down by the Apex Court.
(c) That apart, in Y.K. Bhatia's case (supra), the Full Bench has itself held that it will be open to person affected in the individual cases to establish discriminatory treatment which cannot be explained except on the basis of malice in law or malice in fact.
16. The expression of malice in law has been judicially interpreted in Shearer v. Shields, (1914) Appeal Cases 808 in the following words : "A person who inflicted an injury upon another person in contravention of the law is not allowed to say that he did so with an innocent mind; he is taken to know the law, and he must act within the law. He may, therefore, be guilty of malice in law, although, so far the state of his mind is concerned, he acts ignorantly, and in that sense innocently."
17. This proposition has been adopted in Smt. S.R. Venkataraman v. Union of India and Anr., A.I.R. 1979 S.C. 49. After quoting the English case their Lordships observed : "Thus malice in its legal sense means malice such as may be assumed from the doing of a wrongful act intentionally but without just cause or excuse, or for want of reasonable or probable cause. Thus an act which lacks bona fides or which is unjust or arbitrary can also be declared as vitiated by malice in law."
18. The issue deserves to be examined from another angle. The Preamble of the Constitution of India resolves to secure to all its citizens Justice, social, economic and political; and Equality of status and opportunity. Every State action must be aimed at achieving this goal.
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Part IV of the Constitution contains Directive Principles of State Policy which are fundamental in the governance of the country and are aimed at securing social and economic freedoms by appropriate State action which is complementary to individual fundamental rights guaranteed in Part III for protection against excesses of State action, to realise the vision in the Preamble. This being the philosophy of the Constitution, can it be said that it contemplates exclusion of Article 14 non arbitrariness which is basic to rule of law. In the case of V. Punnan Thomas v. State of Kerala, A.I.R. 1969 Kerala 81 (Full Bench), K.K. Mathew, J., as he then was, held that the government, is not and should not be free as an individual in selecting the recipients for its largess. Whatever its activity, the Government is still the Government and will be subject to restraints, inherent in its position in a democratic society. A democratic Government cannot lay down arbitrary and capricious standards for the choice of persons with whom alone it will deal.
19. The same point was made by the Supreme Court in the case of Erusian Equipment and Chemicals Ltd. v. State of West Bengal, A.I.R. 1975 S.C. 266 where the question was whether blacklisting of a person without giving him an opportunity to be heard was bad? Ray, C.J., speaking on behalf of himself and his colleagues on the Bench pointed out that blacklisting of a person not only affects his reputation which is in Poundian terms an interest both of personality and substance, but also denies him equality in the matter of entering into contract with the Government and it cannot, therefore, be supported without fair hearing. It was argued for the Government that no person has a right to enter into contractual relationship with the Government and the Government, like any other private individual, has the absolute right to enter into contract with any one it pleases. But the Court, speaking through the learned Chief Justice, responded that the Government is not like a private individual who can pick and choose the person with whom it will Page 16 of 24 HC-NIC Page 16 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT deal, but the Government is still a Government when it enters into contract or when it is administering largess and it cannot, without adequate reason, exclude any person from dealing with it or take away largess arbitrarily. The learned Chief Justice said that when the Government is trading with the public, "the democratic form of Government demands equality and absence of arbitrariness and discrimination in such transaction.....The activities of the Government have a public element and, therefore, there should be fairness and equality. The Sate need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair procedure."
20. In the case of Ramana Dayaram Shetty v. The International Airport Authority of India and Ors., A.I.R. 1979 S.C. 1628, their Lordships referred to the propositions laid down in the aforementioned two decisions and held as under: "It must, therefore, be taken to be the law that where the Government is dealing with the public, whether be way of giving jobs or entering into contracts or issuing quotas or licenses or granting other forms of largess, the Government cannot act arbitrarily at its sweet will and, like a private individual, deal with any person it pleases, but its action must be in conformity with standard or norm which is not arbitrary, irrational or irrelevant. The power or discretion of the Government in the matter of grant of largess including award of jobs, contracts quotas, licences etc., must be confined and structured by rational, relevant and nondiscriminatory standard or norm and if the government departs from such standard or norm in any particular case or cases, the action of the Government would be liable to be struck down, unless it can be shown by the Government that the departure was not arbitrary, but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory."
21. In the same decision the Supreme Court further held: "This rule also flows directly from the doctrine of equality embodied in Article
14. It is now well settled as a result of the decisions of this Court in E.P. Royappa v. State of Tamil Nadu, A.I.R. 1974 S.C. 555 and Maneka Gandhi v. Union of India, A.I.R. 1978 S.C. 597 that Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment. It requires that State action must not be arbitrary but must be based on some rational Page 17 of 24 HC-NIC Page 17 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT and relevant principle which is nondiscriminatory; it must not be guided by any extraneous or irrelevant consideration, because that would be denial of equality. The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or nonarbitrariness is projected by Article 14 and it must characterise every State action, whether it be under authority of law or in exercise of executive power without making of law The State cannot, therefore, act arbitrarily in entering into relationship, contractual or otherwise with a third party, but its action must conform to some standard or norm which is rational and nondiscriminatory."
22. In Dwarkadas Marfatia and Sons v. Board of Trustees of the Port of Bombay, A.I.R. 1989 SC 1642, the matter was reexamined in relation to an instrumentality of the State for applicability of Article 14 to all its actions. Referring to the earlier decisions of this Court and examining the arguments for applicability of Article 14, even in contractual matters, Sabyasachi Mukherji, J. (as the learned Chief Justice then was), speaking for himself and Kama, J., reiterated that every action of the State or an instrumentality of the State must be informed by reason......actions uninformed by reason may be questioned as arbitrary in proceedings under Article 226 or Article 32 of the Constitution.
23. In the case of Kumari Shrilekha Vidyarthi etc. etc. v. State of U.P. and Ors., A.I.R. 1991 S.C. 537, a two Judges Bench of the Supreme Court made an extensive and in depth analysis of the scope of equality clause and laid down the following propositions: "It can no longer be doubted at this point of time that Act. 14 of the Constitution of India applies also to matters of governmental policy and if the policy or any action of the Government, even in contractual matters, fails to satisfy the test of reasonableness, it would be unconstitutional. (See Ramana Dayaram Shetty v. The International Airport Authority of India, A.I.R. 1979 S.C. 1628 and Kasturi Lal Lakshmi Reddy v. State of Jammu and Kashmir, A.I.R. 1980 S.C. 1982. In Col. A.S. Sangwan v. Union of India, A.I.R. 1981 S.C. 1545, while the discretion to change the policy in exercise of the executive power, when not trammelled by the statute or rule, was held to be wide, it was emphasised as imperative and implicit in Article 14 of the Constitution that a change in policy must be made fairly and should not give the impression that it was so done arbitrarily or by any ulterior criteria. The wide sweep of Article 14 and the requirement of every State action qualifying for its validity on this touchstone, irrespective of the field of activity of the State, has long been settled. Later decisions of this Court have reinforced the foundation of this tenet and it would be sufficient to refer only to two recent Page 18 of 24 HC-NIC Page 18 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT decisions of this Court for this purpose.
It is now too sell settled that every State action, in order to survive, must not be susceptible to the vice of arbitrariness which is the crux* of Article 14 of the Constitution and basic to the rule of law, the system which governs us. Arbitrariness is the very negation of the rule of law. Satisfaction of this basic test in every State action is sine qua non to its validity and in this respect, the State cannot claim comparison with a private individual even in the field of contract."
24. The meaning and true import of arbitrariness is more easily visualized than precisely stated or defined. The question, whether an impugned act is arbitrary or not, is ultimately to be answered on the facts and in the circumstances of a given case. An obvious test to apply is to see whether there is any discernible principle emerging from the impugned act and if so, does it satisfy the test of reasonableness. Where a mode is prescribed for doing an act and there is no impediment in following that procedure, performance of the act otherwise and in a manner which does not disclose any discernible principle which is reasonable, may itself attract the vice of arbitrariness. Every State action must be informed by reason and it follows that an act uninformed by reason, is arbitrary. Rule of law contemplates governance by laws and not by humour, whims or caprices of the men to whom the governance is entrusted for the time being. It is trite that be you ever so high, the laws are above you.
25. In the case of S.G. Jaisinghani v. Union of India, (A.I.R. 1967 S.C. 1427 at p. 1434, the Court indicated the test of arbitrariness and the pitfalls to be avoided in all State actions to prevent that vice, in a passage as under: "In this context it is important to emphasize that the absence of arbitrary power is the first essential of the rule of law upon which our whole constitutional system is based. In a system governed by rule of law, discretion, when conferred upon executive authorities, must be confined within clearly defined limits. The rule of law from this point of view means that decisions should be made by the application of known principles and rules and, in general, such decisions should be predictable and the citizens Page 19 of 24 HC-NIC Page 19 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT should know where he is. If a decision is taken without any principle or without any rule it is unpredictable and such a decision is the antithesis of a decision taken in accordance with the rule of law. (See Dicey "Law of the Constitution" Tenth Edn., Introduction ex). "Law has reached its finest moments", stated Douglas, J. in United States v. Wunderlick, (1951342 US 98 : 96 Law Ed 113),"When it has freed man from the unlimited discretion of some ruler .....where discretion is absolute, man has always suffered". It is in this sense that the rule of law may be said to be the sworn enemy of caprice. Discretion, as Lord Mansfield stated it in classic terms in the case of John Wilkes (177098 E.R. 327), "means should discretion guided by law. It must be governed by rule, not humour: it must not be arbitrary, vague and fanciful."
26. In the case of Liberty Oil Mills v. Union of India, A.I.R. 1984 S.C. 1271, the Supreme Court held that the expression 'without assigning any reason' implied that the decision has to be communicated but reason for the decision has to be stated; but the reason must exist, otherwise the decision would be arbitrary. This decision was relied upon in Shrilekha Vidyarath's case (supra) to reject the argument made on behalf of the State of Uttar Pradesh that in term of Clause 3 of para 7.06 the services of the Government Pleaders could be terminated at any time without assigning any cause as would appear from the following extract of the decision of Apex Court: "The other part of Clause 3 which enables the Government to terminate the appointment at any time without assigning any cause can also not be considered in the manner, suggested by the learned Additional Advocate General. The termination may be made even during the subsistence of the term of appointment and without assigning any cause means without communicating any cause to the appointee whose appointment is terminated. However, without assigning any cause is not to be equated with without existence of any cause. It merely means that the reason for which the termination is made need not to be assigned or communicated to the appointee. It was held in Liberty Oil Mills v. Union of India, A.I.R. 1984 S.C. 1271 that the expression without assigning any reason implies that the decision has to be communicated, but reasons for the decision have not to be stated; but the reasons must exist, otherwise, the decision would be arbitrary. The nonassigning of reasons or the noncommunication thereof may be based on public policy, but termination of an appointment without the existence of any cogent reason in furtherance of the object for which the power is given would be arbitrary and, therefore, against public policy. Clause 3 of para 7.06 must, therefore, be understood to mean that the appointment of a District Government Counsel is not to be equated with appointment to a post under the Government in the strict sense, which does Page 20 of 24 HC-NIC Page 20 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT not necessarily mean that it results in denuding the office of its public character; and that the appointment may be terminated even during currency of the term by only communicating the decision of termination without communicating the reasons which led to the termination. It does not mean that the appointment is at the sweet will of the Government which can be terminated at any time, even without the existence of any cogent reasons during the subsistence of the term.........................In our opinion, the wide sweep of Article 14 undoubtedly takes within its fold the impugned circular issued by the State of U.P. in exercise of its executive power, irrespective of the precise nature of appointment of the Government counsel in the districts and the other rights, contractual or statutory, which the appointees may have. It is for this reason that we base our decision on the ground that independent of any statutory right, available to the appointees, and assuming for the purpose of this case that the rights flow only from the contract of appointment, the impugned circular, issued in exercise of the executive power of the State, must satisfy Article 14 of the Constitution and if it is shown to be arbitrary, it must be struck down."
27. In Dwarkadas Marfatia's case (supra), Sabyasachi Mukharji, J. (as he then was), indicated the extent of the power of judicial review by observing as under: "......Where there is arbitrariness in State action, Article14 springs in and judicial review strikes such an action down. Every action of the executive authority must be subject to rule of law and must be informed by reason. So, whatever, be the activity of the public authority, it should meet the test of Article 14......"
28. The propositions of law which emerge from the above discussion are:
(i) Article 14 is the genus while Article 16 is the species. It gives effect to the doctrine of equality in all matters relating to public employment.
(ii) The wide sweep of Articles 14, 15 and 16 takes within its fold not only the legislative instruments and all executive/administrative actions of the State and its agencies/instrumentalities but also contractual matters.
(iii) Every State action must be informed by reasons. It must be Page 21 of 24 HC-NIC Page 21 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT fair, reasonable and in public interest and must be free from arbitrariness.
(iv) The basic requirement of Article 14 is fairness in State action irrespective of the nature of power exercised by the State. The State cannot act arbitrarily by way of giving jobs or entering into contracts or issuing quota or licence. Its every action must be confined and structured by rational, relevant and non discriminatory standard and if the government departs from such standards or norms, its action is liable to be struck down on the touchstone of Article 14 of the Constitution.
(v) Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment. They require that State action must be based on valid and relevant principles applicable alike to all similarly situate and it must not be guided by any extraneous or irrelevant considerations.
(vi) The ambit and reach of Articles 14 and 16 are not limited to cases where the public servant in fact has a right to a post. Even if a public servant is in an officiating position, he can complain of violation of Articles 14 and 16 if he has ; been arbitrarily or unfairly treated or subjected to mala fide exercise of power by the State machinery and it is no answer to the charge of infringement of Articles 14 and 16 to say that the petitioner has no right to the post.
(vii) The government cannot justify its arbitrary action in matters involving public employment by relying upon the terms and conditions contained in the letter of appointment or the contract of service or service rules.
(viii) The decisions of the State and public authorities involving Page 22 of 24 HC-NIC Page 22 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT termination of service of permanent and temporary or officiating or ad hoc employees must i satisfy the test of reasonableness. In other words the termination of service even of a temporary employee must be disclosed to the Court as and when such action is challenged by the aggrieved person and it is no answer to the charge of arbitrariness, unfairness or discrimination that the action has been taken in accordance with the terms of employment.
(ix) The expression "matters relating to employment" used in Article 16(1) is just not confined to the initial matters prior to the act of employment, but also comprehend all matters after employment, which are incidental to the employment and from part of the terms and conditions of the employees, such as salary, increments, leave, gratuity, pension, age of superannuation, promotion and even termination of employment.
(x) The termination of service of an employee without the existence of any cogent reasons would be arbitrary and against public policy.
29. Unfortunately, having regard to the shortcoming of the judicial system, this writapplication is being taken up for final hearing after a period of 14 years and that too after being listed for 60 times. The writ applicant attained the age of superannuation sometime in the year 2010 11, therefore, there is no question of now reinstating her in service. In such circumstances referred to above, the question would be what relief should be granted to the writapplicant having regard to the peculiar facts of the case. In my view, appropriate compensation in terms of money should be awarded.
30. In the result, this application is allowed in part. The impugned order of termination is quashed and set aside. The respondents shall pay Page 23 of 24 HC-NIC Page 23 of 24 Created On Wed Aug 10 00:23:19 IST 2016 C/SCA/7138/2002 JUDGMENT Rs.2,50,000/ (Two Lacs & Fifty Thousand Only) to the writapplicant by way of compensation within a period of two months from the date of the receipt of the order. Rule is made absolute to the aforesaid extent.
(J.B.PARDIWALA, J.) aruna Page 24 of 24 HC-NIC Page 24 of 24 Created On Wed Aug 10 00:23:19 IST 2016