W.P. (C) No. 28840 of 2007 (G). Case: Usha K. Vs State of Kerala and Ors.. Kerala High Court

Case Number:W.P. (C) No. 28840 of 2007 (G)
Party Name:Usha K. Vs State of Kerala and Ors.
Counsel:For Appellant: T. Krishnan Unni, Adv. and For Respondents: C.P. Sudhakara Prasad, AG, K.R.B. Kaimal, Sr. Adv. and B. Unnikrishna Kaimal, SC
Judges:V. Giri, J.
Issue:Companies Act - Section 617; Service Rules ;Kerala Public Service Commission (Additional Functions as Respects Certain Corporations and Companies) Act, 1979 ;Constitution of India - Articles 12, 14, 15, 16, 17, 21, 162, 166, 226
Citation:ILR 2007 (4) Ker 862, 2007 (3) KLJ 765
Judgement Date:November 07, 2007
Court:Kerala High Court


V. Giri, J.

  1. The petitioners in all these cases were employees of the Kerala Transport Development Finance Corporation (hereinafter referred to as "the Corporation"), having been appointed on casual basis in the first instance and regularized in the respective posts pursuant to orders issued by the Government. Their services were subsequently terminated by orders passed by the Government followed by consequential orders issued by the Corporation. Those orders are under challenge in these writ petitions.

  2. Most of the contentions taken up by the petitioners are common. Common issues are also involved. Therefore, the writ petitions have been heard together and are being disposed of by this common judgment. W.P.(C) No. 27782/07 is taken as the leading case for the purpose of convenience.

  3. Petitioners 1 to 33 were working as Junior Assistants in the service of the Corporation. Petitioners 34 and 35 were working as Record Keepers and petitioners 36 to 38 were working as sweepers. The 2nd respondent Corporation is a Government company as defined in Section 617 of the Companies Act. As per Ext. P1 Memorandum and Articles of Association, the Board of Directors of the Corporation is empowered to appoint provisionally, technical and skilled employees in the Company. Prior approval of the Governor is necessary for appointment to posts carrying a basic pay of Rs. 2,500/- or more per month.

  4. During 2005, pursuant to the directions issued by the Reverse Bank of India and the Accountant General, the Corporation decided to make regular appointments to various posts. It seems that the Board of Directors of the Corporation in its meeting held on 18-2-2005 approved the service rules and staff pattern of the Corporation and on 10-5-2005, it was forwarded to the Government for approval. Ext.P2 service Rules, inter alia, provides that all first appointments in the Corporation shall be made on the advice of the Public Service Commission as per the provisions of the KPSC (Additional Functions as Respects Certain Corporations and Companies) Act, 1979. The Service Rules also provide for temporary appointments for periods not exceeding 180 days. The principles of communal rotation as contained in Article 14 - 17 of the Constitution are also made applicable to the appointments in different categories of posts in the Corporation. As noted above, Ext.P2 service Rules were framed by the Corporation and was forwarded to the Government and on 10-5-2005 for its approval. In the meanwhile, the Board of Directors in its meeting held on 30-8-2005 decided to seek the regularisation of one person working as a concurrent auditor (contract basis), one person working as Assistant Manager (on contract basis), 66 persons working as Assistant, 15 persons working as Office Assistants, 7 persons working as drivers, 3 persons working as Record Keepers, 13 persons working as Peons/Messengers and 5 persons working as sweepers. The petitioners in these writ petitions are included in this list. All the petitioners were working in their respective categories on casual basis or daily wages basis, some of them from the year 2000, most of them since 2003 and 2004. Few persons have been working in the Corporation since 1997. The Corporation sought for orders from the Government sanctioning regularisation of the services of the contract and daily wages personnel, who were, then in the service of the Corporation. The request in this regard has been made on 4-10-2005 as evidenced byExt.P3.

  5. By Ext. P4 G.O.(MS) No. 13/06/transport dated 22-2-2006, Government accorded sanction for creation of 143 posts in various categories with the scales of pay as shown in the Annexure to the said order. By Ext.P5 order passed on the same day, the Government accorded sanction for regularisation of 106 contract/daily wages employees working in the Corporation and absorption of such persons to the regular service of the Corporation against the newly created posts counting their previous casual service, by giving retrospective effect to the order of regularization, without any monetary benefits.

  6. In other words, on 22-2-2006, the Government passed an order sanctioning 143 posts in different categories and on the same day the Government accorded sanction for regularisation of the services of 106 persons working on contract/daily wages basis from a date prior to the date on which the posts in question were sanctioned. Pursuant to Ext.P5 all the petitioners were regularized in service with effect from the date on which they had been engaged in the Corporation on casual/daily wages basis.

  7. By a separate order Ext.P6 passed on the same day i.e. 22-2-2006, the Government approved Ext.P2 service Rules of the Corporation, subject to certain amendments regarding leave rules as mentioned in the Annexure thereto.

  8. While the petitioners, therefore, continued in service, the Government, on 12-2-2007 passed an order holding that the Government have reviewed the entire exercise, which took place as per Ext.P5 order of regularisation of 106 employees, who were appointed on contract/daily wages. This exercise was undertaken because it was found that the daily wages/contract appointments were not made through any competitive examination/interview, by inviting applications or by advertising the vacancies through dailies. Communal reservation was not followed, while regularizing the appointments. Nor was there any representative of Scheduled Caste/Scheduled Tribe communities among the ministerial staff. Government, therefore, proceeded to cancel Ext.P5 with immediate effect.

  9. Ext.P7 order passed by the Government so cancelling the regularisation was challenged in a batch of writ petitions before this court. By Ext.P8 judgment dated 13-7-2007, the writ petitions were allowed on the ground that Ext.P7 order was passed in violation of the principles of natural justice. This Court made it clear that the court is not expressing any opinion on the other contentions raised by the petitioners. The Government was given liberty to pass fresh orders in the matter after affording an opportunity of being heard to the affected persons.

  10. Pursuant thereto, Ext.P9 notice was issued by the Government to all the petitioners requiring them to show cause why the order by which their services were regularized should not be cancelled. The reason given in the show cause notice was that the engagement of 106 persons was irregular, inasmuch as that it was done without observance of the principles of communal rotation. Objections were filed by the petitioners to the said notice. Government passed Ext.Pl 2 order rejecting the objections and held that the sanction for regularisation issued as per Ext.P5 is wholly unjustified and illegal. The said order was, therefore, revoked. Almost identical orders were issued as Ext.P 13 services stood terminated pursuant to Ext. P14 orders issued by the Corporation. The petitioners challenge Exts. P12, P13 and P14 orders of the Corporation. They also seek a mandamus commanding the respondents to reinstate them with continuity of service, back wages and other benefits arising from the date of their termination. Petitioners contend that the Government acted illegally and without jurisdiction in revoking Ext.P5 order by which the Government had sanctioned regularisation of 106 employees, working in different categories in the Corporation. Ext.P5 order, assuming that the same is administrative, cannot be revoked. The appointment of the petitioners cannot be construed as illegal. Significantly, all the petitioners are qualified in terms of Ext. P2 service Rules. They have been in service for several years. They have continued in service for almost an year since Ext.P5 order, when the same was cancelled without any justification. None of the reasons given by the Government for cancelling its own order is either tenable or reasonable. Apparently, extraneous reasons have influenced the Government in revoking Ext.P5 order.

  11. Separate counter affidavits have been filed by the Government and the Corporation. The orders by which the earlier order of regularisation is cancelled is sought to be upheld by the Government and the Corporation. It is contained that Ext.P5 order of regularisation was per se illegal. All the persons who have been regularized including the petitioners were originally appointed on daily wages basis. No method of appointment was adopted. Regularisation was ordered without any justification. The employment in question is...

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