Patna High Court
Santu Singh And Ors. And Sri Chhote ... vs State Of Bihar And Ors. on 22 April, 2002
Equivalent citations: 2002(2)BLJR1615
Author: Aftab Alam
Bench: Aftab Alam
ORDER Aftab Alam, J.
1. These two writ petitions arise from the same set of facts and circumstances and the petitioners in these two cases seek similar reliefs. These two cases were, therefore, heard together and are being disposed of by this common order.
2. The petitioners in these two cases (116 in number in CWJC No. 1503 of 2000 and 81 in CWJC No. 14394 of 2001) are the employees of Fatuha-Phulwari Sharif Gramin Vidyut Sahkari Samiti Limit ('the Samiti', hereinafter) which is currently under liquidation. They seek from this Court directions (i) for their absorption in the service of the Bihar State Electricity Board ('the Board', hereinafter and (ii) for payment of their arrear salary from June, 1996 by the Board.
3. Under a scheme of the Department of Co-operation in the Government of Bihar, the Samiti was set up with the object of supplying electricity to the rural areas around the State capital on co-operative basis. The Samiti was registered under the Bihar Co-operative Societies Act, 1935, Section 35 of which provides that on registration a Society would become a body corporate with perpetual succession. On 24.8.1976 the State Government granted to the Samiti necessary licence under Section 3 of the Indian Electricity Act, 1910 for a period of twenty years.
4. Under the scheme, the Board gave to the Samiti assets worth Rs. 61 lacs and supplied to it electricity @ Rs. 6 paise per unit; the Samiti in its turn supplied electricity to its consumers at much higher rates of 0.90 paise to Rs. 1.15 paise, chargeable by the Board from its customers. However, the Samiti was completely unable to fulfil the objects for which it was set up. It became a liability and provide to be a source of considerable loss to the Board. According to the Board, by 31.3.1993 the Samiti owed it a sum of Rs. 2 crores. In those circumstances the Board made a recommendation to the State Government to cancel the iicence granted to the Samiti under Section 3 of the Indian Electricity Act. The State Government apparently agreed with the recommendation and on 18.8.1993 gave to the Samiti a notice (Annexure-4) for revocation of its licence. The licence granted to the Samiti was finally revoked by order, dated 25.4.1995 (Annexure-5). In course of the proceedings for revocation of the licence, the State Government enquired from the Board, as provided under Section 5(1)(b) of the Act, whether it was willing to purchase the Samiti's undertaking. The Board indicated its willingness and accordingly in the order of revocation of the licence the Government proposed to constitute a committee for determination of the purchase price of the Samiti's undertaking, as provided in Section 7-A of the Act. The committee proposed to be constituted for determining the purchase price would also be required consider as to which of the officers/employees of the Samiti might be useful for the Board, whereupon, it was stated in that order, the Government would take a decision.
5. On 26.4.19S5, i.e., the day following the insurance of the order of revocation of licence, an officer of the Beard of the rank of Electrical Executive Engineer was posted on .deputation to the Samiti as its Managing Director and on 29.4.1995 he addressed a letter to the Electrical Superintending Engineer, Patna Electrical Circle, Patna intimating that he was authorized the Board to maintain power supply in the areas which till then were under the Samiti and that he was, thus, under the supervisory control of the Electrical Superintending Engineer, Patna Circle. It was further stated in that letter that the supply of electricity was being maintained with the help of the officers and workman of the Samiti.
6. On 8.9.1995 the committee was constituted as proposed in the order of revocation of licence and on 10.11.1995 the committee made its report. In para 3 of the report, the committee stated that the total number of employees, from Junior Electrical Engineers (s) to the Class IV employees, in the Samiti was 225. It then made a recommendation that services of the employees of the Samiti may be utilized for maintaining the supply of electricity in the area previously under its control and further that the Board should make payment of salary to them and should absorb in its service such of the employees who might be found qualified.
7. On 26.7.1995 some questions were asked in the Legislative Assembly regarding the fate of the employees of the Samiti. In the answers given by the Minister of Power though there was no commitment or assurance regarding the time frame, there was clear indication that the Government proposed the absorption of the employees of the Samiti in the service of the Board. On the basis of the answers given by the Government on the floor of the House, the in-charge Secretary of the Assembly wrote a letter, dated 13.2.1997 to the Chief Secretary, the Secretaries, Departments of Co-operation and Energy and the Chairman of the Board requesting them that in the light of the assurance given in the House, the take over of the assets and liabilities of the undertaking of the Samiti along with its employees should be completed without any further delay.
8. However, on 24.2.1997 the Energy Secretary wrote to the Secretary, Department of Co-operation and the Chairman of the Board informing them about the Government decision on this issue. A copy of this letter is at Annexure-A to the supplementary counter-affidavit filed on behalf of respondents 1 and 2. In this letter, the Energy Secretary stated that the Government had taken the decision that there was no question of absorption of the employees of the Samiti in the service of the Board. He further advised the Secretary, Department of Co-operation to start the liquidation proceeding of the Samiti immediately so that a determination may be made of its assets and liabilities.
9. Misc. Case No. 187 of 1997 was then instituted for the liquidation of the Samiti. On 2.11.1999 the Registrar, Co-operative Societies finally passed an order in this proceeding for the liquidation of the Samiti and appointed a liquidator for the purpose.
10. It, however, appears that the issue was not fully closed notwithstanding the Government decision, dated 24.2.1997 making it clear that there was no question of absorption of the employees of the Samiti in the service of the Board. It seems that there was an exchange of correspondence between the concerned Government Departments (though the Board does not seem to have taken any part in this exchange of letters/proposals/ideas). Relevant in formations, e.g., the number of employees of the Samiti and further details on the subject were asked for and supplied by one Government Department to another in the light of which the Government slightly modified its earlier decision, dated 14.2.1997 and in August, 2001, the Government reportedly took the decision that as and when the present prohibition against recruitment in the Board was lifted and appointments were made there in future, preference would be given to the eligible employees of the Samiti and, if necessary, they would also be allowed relaxation of the age limit.
11. It is at this stage and in the back ground of the aforesaid facts and circumstances that the petitioners in these two writ petitions have come to this Court, seeking the reliefs as noted above.
12. Before proceeding further, it may be noted that though the State Government and its officials in the Departments of Energy and Co-operation are made party respondents, no relief is sought against the State Government. The Samiti, of which the petitioners are employees, is neither made a party nor any relief is sought against it and the twin reliefs relating to absorption in service and payment of arrears of salary is claimed only against the Board.
13. Counter-affidavits have come from the two concerned departments of the State Government, apart from a counter-affidavit from the Electricity Board. The counter-affidavit filed by the Department of Co-operation does not contain anything of any significance; it neither supports nor opposes the reliefs prayed for en behalf of the petitioners.
14. The counter-affidavits filed on behalf of the Department of Energy states the stand the of State Government on this issue. On the Court's direction a supplementary counter-affidavit was filed, affirmed personally by the Energy Secretary. Paragraph 6 of this affidavit contains the statement regarding the Government decision, dated 24.2.1997 that there was no question of the Board taking over the employees of the Samiti; paragraph 23 of the affidavit states about the later Government decision to give preference to the eligible employees of the Samiti as and when the present ban on recruitments in the Board was lifted.
15. The Board in its turn has strongly resisted the reliefs claimed by the petitioners in these two writ petitions and before proceeding to consider the contentions advanced on behalf of the parties, it may be noted that Mr. R.K. Dutta, learned Additional Standing Counsel appearing for the Board sought to contest even the later decision of the State Government. Mr. Dutta submitted that the Government decision that once the present embargo imposed on all recruitments is lifted and appointments are made in the Board, the employees of the Samiti would be considered on a preferential basis and they would be given age relaxation was not binding upon the Board. Mr. Dutta pointed out that no provision of law authorized the State Government either to give any such direction to the Board or to bind it with such decision. Mr. Dutta submitted that the only provision under which the Government was empowered to give directions to the Board was contained in Section 78-A of the Electricity Supply Act, 1948. But the provision of that section did not include the power to give any direction on the issue of appointment/recruitment to be made by the Board which was governed by the provision of Section 15 of the Act. In support of his submissions, Mr. Dutta relied upon a Supreme Court decision in the case of Rakesh Ranjan Verma and Ors. v. State of Bihar and Ors. .
16. Both Dr. S.N. Jha and Mr. Indu Shekhar Prasad Sinha, Senior Advocates appearing in these two writ petitions contested the submissions made by Mr. Dutta on this issue. Dr. Jha and Mr. Sinha contended that it was within the powers of the State Government to issue such a direction to the Board and submitted that the decision in Rakesh Ranjan Verma had no application to the facts of this case.
17. Though prima facie it appears to me that the contention of Mr. Dutta, based on the Supreme Court decision in Rakesh Ranjan Verma is well founded, in this case that issue hardly arises. The State Government has not given any direction to the Board; its decision is based on a contingency in indeterminate future. The petitioners have not come to the Court for the enforcement of that Government decision. What the petitioners pray for is a direction to be issued by this Court now, for their absorption in the service of the Board.
18. Dr. Jha, learned Senior Counsel appearing for the petitioners in CWJC No. 1503 of 2000 pressed the petitioners' claim for absorption in the service of the Board on certain broad principles and without much reference to any statutory provisions. Dr. Jha submitted that under Section 18 of the Electricity (Supply) Act, 1948, it was . the responsibility and statutory duty of the Board to supply electricity to consumers. The Samiti was set up to perform the functions which are the statutory responsibility of the Board. The petitioners had worked in the Samiti from 1976 to 1976, that is, for nearly twenty years and during their service tenure, they were doing the work which was the statutory duty of the Board. According to Dr. Jha this was sufficient reason for their absorption in the Board's service.
19. Expanding the point Dr. Jha submitted that on examining the structure and composition of the Samiti, its financial resources and the exercise of administrative control over it, it would become apparent that the Samiti was an instrumentality of the State and was set up as an extension of the Board for performing the functions and responsibilities assigned by law to the Board. Dr. Jha submitted that that being the position, the absorption of the Samiti's employees in the service of the Board should be the natural and logical consequence of the Samiti going into liquidation. Because even while the Samiti was alive and functioning its employees performed the duties of the Board. Dr. Jha urged the Court to 'lift the veil1 and see the real character of the Samiti.
20. I am unable to accept the submission. 'On lifting the veil' one would indeed find that the Samiti was an instrumentality of the State but no amount of lifting the veil would reveal it as 'an extension of the Board'. It may be borne in mind that in 1976 the Board was very much in existence and was fully in position to supply electricity to the areas covered by the Samiti. But under a Government scheme it was decided that the supply of electricity to the rural areas around the State capital be made on the principles of co-operation. With that end in view the supply of electricity to the areas in question was entrusted to the Samiti, set up as an alternate and substitute to he Board. It would be, therefore, incorrect to contend that the Samiti was an extension of the Board or that the Samiti and the Board were one and the same. In fact the Samiti had legal identity distinctly separate from the Board.
21. Further, as it will be seen later on in this judgment, the issue of taking over the services of the employees of an erstwhile licence is controlled and governed by different statutory provisions and, therefore, to my mind, the general proposition advanced by Dr. Jha will not constitute a proper basis for this Court to issue any direction for the petitioners absorption in the Board's service.
22. Dr. Jha also submitted (making a reference to paras 25 and 26 of the writ petition) that in the past the Board took over a number of private companies (a list of which is given in Annexure-18). According to Dr. Jha in all previous cases of take over the employees of the private companies were also taken in the service of the Board, following the acquisition of the companies' undertakings. Dr. Jha submitted that there was no reason to make a deviation from the practice followed in the past and the Board must not refuse to absorb the petitioners, following its acquisition of the Undertaking of the Samiti. Any past practice cannot be made the basis for enforcing the petitioners' claim for absorption. The previous take over were made in the year, 1975. Twenty five years ago the position of the Board, financially, administratively and otherwise was vastly different from what it is today. It might even be said that indiscretions of this kind in the past were responsible, at least in part, for the Board's highly precarious condition today when even its survival in its present form is at stake. Learning from its past mistakes, if the Board decides not to commit similar excesses, it can hardly be compelled to do so by a direction of the Court, unless the rights of the petitioners are shown to be founded on much firmer grounds.
23. Dr. Jha next invoked the principle of legitimate expectation. He made a reference to the order of revocation of licence in which the Government had proposed to constitute a committee which, apart from determining the purchase price of the Samiti's undertaking, was also required to consider the question concerning its employees. He also referred to the committee's recommendations as contained in its report, dated 10.11.1995. He heavily relied upon the answers given by the Government in the Assembly and the letter written by the Secretary of the Assembly on the basis of the answers of the Government given on the floor of the House. Relying mainly on these materials, apart from a few others, Dr. Jha submitted that the petitioners had developed a legitimate expectation regarding their absorption in service and in the light of those materials the Government cannot be allowed to resale from its stand to properly rehabilitate the petitioners by their absorption in the service of the Board.
24. The submission is unacceptable for more reasons than one.
25. Mr. Dutta, Counsel for the Board rightly submitted that the claimed absorption in service was being made against the Board but there was absolutely no material to show that the Board ever gave any indication, direct or indirect, regarding its willingness to absorb the employees of the Samiti in its service. The materials relied by the petitioners are communications between two departments of the Government and the statement of the Government made in answer to certain questions in the Assembly. Mr. Dutta submitted that that surely cannot from the basis to hold that the Board ever gave any expectation to the petitioners.
26. Apart from this, in the facts of this case I am unable to see any application of the principle of legitimate expectations. The materials relied upon by Dr. Jha are viewed by me quite differently. When the licence granted to the Samiti was revoked and when a decision was taken for its liquidation, one of the important matters requiring consideration would be the fate of its employees and it is hardly surprising that the Government would consider this matter seriously and sincerely and would try to find out ways and means for the rehabilitation of the employees of the defunct Society. That would naturally involve exchange of in formations and views between the department of Co-operation and Energy. But, mere exchange of views and in formations between two Government departments cannot give rise to any legitimate expectations. It may also be noted that on a consideration of all the relevant materials the Government took the decision that there was no question of absorption of the employees of the Samiti in the service of the Board, as far back as in February, 1997 and, therefore, the employees of the Samiti were never kept under any illusion even by the Government. The principle of legitimate expectation, therefore, has no application to the facts of this case.
27. In support of his submission, Dr. Jha relied upon a number of Supreme Court decisions, the first of which was in G. Govinda Rajulu v. The Andhra Pradesh State Construction Corporation Limited . It is a very brief order which is reproduced below in its entirity:
We have carefully considered the matter and after hearing learned Counsel for the parties, we direct that the employees of the A.P. State Construction Corporation Limited whose services were sought to be terminated on account of the closure of the Corporation shall be continued in service on the same terms and conditions either in the Government Departments or in the Government Corporations.
The writ petition is disposed of accordingly. There is no order as to costs.
28. The order does not decide or lay down any legal principle to be followed as a precedent and Mr. Dutta is quite right in his submission that the order in G. Govinda Rajulu was one under Article 142 of the Constitution, rather, than a decision laying down any judicial precedent.
29. Dr. Jha also relied upon the decisions of the Supreme Court in (i) Hindustan Machine Tools and Ors. v. M. Ranga Reddy and Ors. (ii) Gujarat Agricultural University v. Rathod Labhu Bechaar and (iii) Raushni Devi and Ors. v. State of Haryana . In these decisions the Supreme Court directed for the absorption of the concerned employees in the same unit on equitable considerations, and after the concerned employees had rendered long years of service. These decisions do not relate to any claim for absorption in the service of an altogether different undertaking, following the liquidation, take over etc. of another concern. These decisions, therefore, do not seem to have any application to the facts of this case.
30. Dr. Jha also relied on another Supreme Court decision in Union of India and Ors v. Kishori Lal Babulani . In this decision the appointment of the concerned employee was not disturbed, on equitable considerations, after ten years of his appointment, though it was shown that his appointment was made due to some mistake in the relevant notification. This decision too has no application to the facts of this case.
31. Having, thus, considered the submissions made by Dr. Jha, it is now the turn to consider the submissions made by Mr. Indu Shekhar Prasad Sinha, learned Senior Counsel appearing for the petitioners in CWJC No. 14394 of 2001. Mr. Sinha tried to rest the petitioners' claim for absorption in the service of the Board on a statutory basis, rather, than on some general equitable principles as attempted by Dr. Jha. To be more specific, Mr. Sinha relied upon the provisions of Section 7 of the Indian Electricity Act, 1910 in support of the petitioners' claim for absorption in the service of the Board. He advanced a proposition that whenever the Board acquires an undertaking, it would also be bound to take over and absorb in its service the employees working in the taken over undertaking and submitted that no undertaking could be taken over without its employees.
32. In order to appreciate the submissions made by Mr. Sinha, it would be necessary to take a look at Section 7 of the India Electricity Act which is reproduced below:
7. Vesting of the undertaking in the purchaser.-Where an undertaking is sold under Section 5 or Section 6, then upon the completion of the sale or on the date on which the undertaking is delivered to the intending purchaser under Sub-section (3) of Section 5 or under Sub-section (6) of Section 6, as the case may be, whichever is:
(i) the undertaking shall vest in the purchaser or the intending purchaser, as the case may be, free from any debt, mortgage or similar obligation of the licensee or attaching to the undertaking:
Provided that any such debt, mortgage or similar obligation shall attach to the purchase-money in substitution for the taking;
(ii) the rights, powers, authorities, duties and obligations of the licensee under this licence shall stand transferred to the purchaser and such purchaser shall be deemed to be the licensee:
Provided that where the undertaking is sold or delivered to a State Electricity Board or the State Government, the licensee shall cease to have further operation.
33. Mr. Sinha submitted that the expression 'undertaking' used in Section 7 was sufficiently wide to include the employees working in the unit purchased by the Board in terms of Section 5 of the Act.
34. In support of the submission that the employees working under the previous licensee were covered by the expression 'undertaking', Mr. Sinha relied upon a constitution bench decision of the Supreme Court in R.C. Cooper v. Union of India (paras 162 to 165). He laid special emphasis on para 164 of the judgment which is reproduced below:
164. The word 'undertaking' is used in various statutes of our country, viz., the Indian Electricity Act, 1910 (Sections 6, 7, 7-A), Indian Companies Act (Sections 125(4)(f), 293 and 394), Banking Regulation Act, 1949 (Section 14-A), Cotton Textiles Companies, (Management of Undertaking and Liquidation or Recantation Act, 1967 (Sections 4(1), 5(1), (2). By the word 'undertaking' is meant the entire organization. These provisions indicate that the company whether it has a plant or whether it has an organization is considered as one whole unit and the entire business of the going concern is embraced within the word 'undertaking'. In the case of sale of an undertaking as; happened in Doughty v. Lomagunda Reefs Ltd. the purchaser was required to pay all debts due by and to perform outstanding contracts comprised in the entire undertaking. The word 'undertaking' is used in the Indian Electricity Act, the Air Corporation Act, 1953, Imperial Bank of India Act, 1920 (Sections 3, 4, 6 and 7), the State Bank of India Act, 1955 (Section 6(1)(g), the State Bank Subsidiaries Banks Act, 1959 (Section 10(1). The Banking Regulation Act, 1949 (Section 36-AE (1) and there have been legislative provisions for acquisition of some of these undertakings.
35. Mr. Sinha also cited another Supreme Court decision in Doypack System Pvt. Ltd. v. Union of India . In para 51 of this decision, following R.C. Cooper, it was stated as follows:
51. As to what an undertaking means, has been clarified in R.C. Cooper v. Union of India, where the Act of 1969 was challenged. It was held that the meaning of the expression "undertaking" is a going concern as distinct from its assets and liabilities. It was also observed that it covered every corners of property, right, title and interest therein. This Court rejected one of the grounds of challenge as there was no evidence that the named banks held any assets for any distinct non-banking business, which finding gives an idea as to what could have been excluded from the acquisition of the undertaking.
36. On a careful consideration, I am unable to read either R.C. Cooper or Doypack Systems Pvt. Limited as laying down that the expression 'undertaking' used in Section 7 of the Indian Electricity Act also includes the employees working under the previous licensee and the owner of the unit and, therefore, while purchasing the undertaking the Board would be obliged to absorb in its services all the employees of the previous owner of the undertaking.
37. Such a surmise is demolished by the provision of Section 7-A of the Act, dealing with the determination of the purchase price. Sub-section (1) of Section 7-A of the Act reads as follows:
(1) Where an undertaking of a licensee, not being a local authority, is sold under Sub-section (1) of Section 5, the purchase price of the undertaking shall be the market value of the undertaking at the time of purchase or where the undertaking has been delivered before the purchase under Sub-section (3) of that section, at the time of the delivery of the undertaking and if there is any difference or dispute regarding such purchase-price, the same shall be determined by arbitration.
(Emphasis added)
38. From the under-line portion of the section it would be clear that if the expression undertaking were to include the employees of the previous licensee, then the market value of those employees will also have to be determined as forming part of the purchase price of the undertaking. This, to my mind, is an unthinkable proposition.
39. In Bihar the provisions of Section 7-A of the Act is substituted by an amended provision but the amended provision also makes it evident that the undertaking does not include any human beings like the previous employees of the unit.
40. Apart from this Mr. Dutta, appearing for the Board, raised several other objections to Mr. Sinha's submissions. Mr. Dutta submitted that on the plain reading of Section 7, it will be clear that its provision would come into play only upon the completion of the sale. He pointed out that in this case no sale had taken place till date. Learned Counsel stated that far from the completion of the sale on order passed by the State Government in terms of Clause (c) of Sub-section (1) of Section 5 was produced before the Court. Mr. Dutta further submitted that the liquidation of the Samiti was still in process and even the determination of the purchase price of its undertaking could only be made after its liquidation was completed.
41. Mr. Dutta next submitted that contrary to the submissions made on behalf of the petitioners, even at the stage of the completion of the sale, Section 7 provided for the vesting of the undertaking sans its previous employees. In this regard he invited my attention to Sub-section (1) of Section 7 and the proviso to Sub-section (1). Sub-section (i) of Section 7 provides that the undertaking shall vest free from any debt, mortgage or similar obligation of the licensee or attaching to the undertaking and the proviso stipulates that any debt, mortgage or obligation would attach to the purchase money in substitution for the undertaking.
42. Mr. Dutta then drew a linkage between the proviso to Section 7(i) of the Indian Electricity Act and Section 25-FF of the Industrial Disputes Act, 1947 which is as follows:
25-FF. Compensation to workmen in case of transfer of undertakings.-Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, from the employer in relation to that undertaking to a new employer, every workman who has been in continuous service for not less than one year in that undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of Section 25-F, as if the workman had been retrenched:
Provided that nothing in this section shall apply to a workman in any case where there has been change of employers by reason of the transfer,
(a) the service of the workman has not been interrupted by such transfer;
(b) the terms and conditions of service applicable to the workman after such transfer are not in any way less favourable to the workman than those applicable to him immediately before the transfer; and
(c) the new employer is under the terms of such transfer or otherwise, legally liable to pay to the workman, in the event of his retrenchment, compensation on the basis that his service has been continuous and has not been interrupted by the transfer.
(Emphasis added) 43 Mr. Dutta submitted that on a conjoint reading of the proviso to Sub-section (1) of Section 7 of the Indian Electricity Act and Section 25-FF of the Industrial Disputes Act, it would be plain and clear that the claim of the petitioners could lay only against the previous employer i.e. the Samiti and their claim for compensation would be satisfied from the purchase price that may be received by the Samiti from the purchaser, that is the Board.
44. in support of his submission Mr. Dutta relied upon a constitution bench decision of the Supreme Court in A.C.A & I. Society v. Workmen (paras 16 and 18 at page 1495). In para 16 of this decision, it was observed as follows:
This provision has been made for the purpose of calculating the amount of compensation payable to such workmen; rather than provide for the measure of compensation over again, Section 25-FF makes a reference to Section 25-F for that limited purpose, and, therefore, in all cases to which Section 25-FF applies, the only claim which the employees of the transferred concern can legitimately make is a claim for compensation against their employers. No claim can be made against the transferee of the said concern.
(Emphasis added)
45. The decision in A.C.A. & I. Society was followed by the Supreme Court in Central Inland Water Transport Corporation Ltd. v. The Workmen and Anr. .
46. Mr. Dutta also relied upon a decision of the Allahabad High Court in Bijli Mazdoor Sangh v. U.P. Electricity Board , in support of his contention that a purchase in terms of Section 5 of the Indian Electricity Act would not give rise to any claim by the previous employees of the unit for absorption in the service of the Board.
47. Mr. Shivajee Pandey, the Advocate-on-record for the petitioners in CWJC No. 1503 of 2000 intervened to submit that the facts in A.C.A. & I. Society were slightiy different from the facts of the present case. The Supreme Court had found in the case before it that the workers had already received closure compensation and it was in that circumstance that they were held not entitled! to the further relief of absorption in the employment of the successor in interest of the transferred unit. Mr. Pandey further submitted that in the case before this Court the petitioners have not been paid a single paisa as closure compensation and, therefore, their position was not comparable to the workers in A.C.A. & I. Society and the petitioners were, therefore, entitled to the relief of absorption in the service of the Board on equitable considerations.
48. I do not think that this distinction in the facts of the two cases, as pointed out by Mr. Pandey, would make any difference in the legal position as enuciated by the Supreme Court in A.C.A. & I. Society (supra).
49. On a consideration of the rival contentions, I have no doubt in my mind that Section 7 of the Indian Electricity Act cannot be made the basis for a claim for the petitioners' absorption in the service of the Board. The expression 'undertaking' used in that section does not include the employees of the previous owner of the unit. The claim of the petitioners would lie against the Samiti and the petitioners' claim for compensation must be satisfied from the purchase price that the Samiti would receive from the Board.
50. Mr. Indu Shekhar Prasad Sinha also invoked same equitable principles in support of the petitioners' claim for absorption. It was submitted that after revocation of the licence of the Samiti, the petitioners had worked under the Board and had received salary upto May, 1996. Mr. Sinha further submitted that at some stage the Chairman of the Board had also indicated his willingness to absorb the employees of the Samiti.
51. The submissions are not supported by any materials on the record of the case. What is described as the willingness expressed by the Board's Chairman to absorb the employees are some statements made in the inter-departmental communications of the State Government. There is no scrap of paper coming from the Board in which any such undertaking is to be found.
52. Mr. Dutta also contradicted the statement that the Board made any payment of salary to the petitioners or any other employees of the Samiti. There is nothing to show that the petitioners were ever paid their salary by the Board.
53. Apart from all this the claim of the petitioners for absorption in the service of the Board, on equitable considerations, cannot be considered in disregard of its consequences upon the Board. The Board is in crisis for a long time which instead of showing any sings of improvement turns from bad to worse. It is no secret that the Board is highly over-staffed. The disputes resulting from the setting up of the Jharkhand State Electricity Board, following the reorganization of the State, have also caused much harm to the Board. It is left with a large number of surplus staff who were allotted to the Jharkhand Board in cadre allocation but who are not being accepted by the Jharkhand Board. The Board is plagued with numerous problems of various kinds. One can even say that the Board is no longer surviving on its own inner vitality. But it survives because it cannot die, being a part of a modern State. At the moment it hopes to receive a large package of Central aid for reorganization of the power sector in this State. One of the pre-conditions for the grant of the Central aid is the de-bundling of the Board which would necessitate retrenchment of a large number of its existing employees. In these circumstances, when the Board's own survival is at stakes, it cannot be compelled by a direction issued by the Court to absorb in its service about 230 additional employees on the pretext of equitable considerations for those persons. Any equitable consideration for the claim of the petitioners must yield to the larger interest of the survival of the Board. Therefore, howsoever sympathetically this Court may view the plight of the present petitioners, it is unable to bring itself to issue a direction for their absorption in the Board on the plea of equitable considerations.
54. In the light of the discussions made above it follows that the Board is under no legal obligation to take the employees of the Samiti following the revocation of the Samiti's licence under Section 4 of the Act.
55. For all these reasons, no relief as prayed can be granted to the petitioners. These two writ petitions are accordingly dismissed but there will be no order as to costs.