Full Judgment Text
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 4
PETITIONER:
MADHYA PRADESH HASTA SHILPA VIKAS NIGAM LIMITED
Vs.
RESPONDENT:
DEVENDRA KUMAR JAIN & ORS.
DATE OF JUDGMENT07/12/1994
BENCH:
FAIZAN UDDIN (J)
BENCH:
FAIZAN UDDIN (J)
AGRAWAL, S.C. (J)
CITATION:
1995 SCC (1) 638 JT 1995 (1) 198
1994 SCALE (5)164
ACT:
HEADNOTE:
JUDGMENT:
FAIZAN UDDIN, J.:
1. Leave granted.
2. The appellant is a Government Company within the
meaning of Section 617 of the Companies Act which is
controlled and owned by the State Government and a
subsidiary company of M.P. Laghu Udhyog Nigam Limited which
is carrying on business activities of development of
handicrafts and handloom products. At the relevant time one
Shri K.P. Thakur was the Managing Director of the appellant-
company who by an order dated 6.7.89 Annexure-D appointed
the respondents No. 1 to 3, namely, Devendra Kumar Jain.
Dilip Goel and Promod Mishra as temporary Jr. Manager and by
subsequent two orders both dated 8.6.89 (Annexure-E/1 and 2)
appointed the respondents No. 4 and 5, namely. Mehboob
Hussain and Liaquat Mohd. Khilzi as temporary Junior
Managers in the appellant-company. Soon after their
appointment the appellant-company noticed that the aforesaid
appointments of respondents No. 1 to 5 were made by the then
Managing Director. Shri K.P. Thakur in contravention of the
Government Order dated 1.4.89 Annexure-B without the
approval of the State Government and therefore. another
Managing Director successor of Shri K.P. Thakur by order
dated 31.7.89 terminated the services of the respondents No.
1 to 5. The respondents challenged the aforesaid order of
termination in the High Court of Madhya Pradesh in
Miscellaneous Petition No. 3973/83 which was allowed by
judgment dated 1.12.93 whereby the order of termination of
the respondents was quashed. It
200
has been directed that the respondents will continue in
service till their services are not validly terminated. It
is this order which has been challenged in this appeal.
3. The High Court quashed the order of termination of
service of respondents mainly on two grounds. Firstly, the
High Court took the view that the respondents services were
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 4
terminated without giving them any opportunity of hearing in
consonance with the rules of natural justice and, therefore,
the order of termination of service was contrary to law and
violatire of Article 14 of the Constitution and; secondly,
Government approval was not necessary for the appointment as
contended by the appellant and that in any case nO material
was placed to show that the appointment was contrary to the
Government instructions. In our considered opinion the High
Court fIl in serious error in taking the aforesaid view and,
therefore, the order of the High Court could not be
sustained in law.
4. Admittedly the appointment of the respondents was
made purely on temporary basis which is evident from the
order of their appointment. The first order dated 6.7.89
Annexure-D by which the respondents No. 1 to 3 were
appointed reads as follows:
Bhopal; 6.7.89
ORDER
"The following persons are appointed to
the post of Junior Manager in the Pay Scale of
1290-30-1560-40-2040 from the date of taking
over, till further orders temporarily and are
posted 10 the Headquarters:-
1. Shri D. K. Jam
2. Shri Pramod Mishra
3. Shri Dilip Kumar Goyal
2. Employee has to submit Medical Fitness
Certificate from Civil Surgeon of the
District.
3. Dearness Allowance and other facilities
according to the rules of the Corporation
shall be payable.
Above appointments are purely temporary
and are liable to termination without notice
or assigning any reason.
By order of Managing Director
GENERAL MANAGER
Hastashilp Vikas Nigam LTd., Bhopal"
6.7.89
The subsequent two orders both dated 8.6.89 with regard to
the appointment of respondents No. 4 and 5 are identical one
of which is reproduced herein below:-
6.7.89
ORDER
"Shri Mohammad Hussain is appointed to
the post of Junior Manager in the Pay Scale of
1290-30-1560-40-2040 from the date of taking
over, temporarily and posted at Headquarters.
Employee has to obtain Medical Fitness
Certificate from Civil Surgeon and submit to
office.
Dearness Allowance and other facilities
according to the rules of the Corporation
shall be payable.
Above appointment is purely temporary and
is liable to termination at any time without
notice or assigning a reason.
GENERAL MANAGER"
201
5. A plain reading of these two orders will go to show
that the appointments were made purely on temporary basis
and their services were liable to be terminated at any time
without notice or assigning any reason. In the case of
appointment on temporary basis a servant who is so appointed
does not acquire any substantive right to the post, even
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 4
though the post itself may be permanent and it is an implied
term of such appointment that it may be terminable at any
time and without notice. A temporary Government servant does
not become a permanent Government servant unless he acquires
that capacity by force of any rule or he is declared or
appointed as a permanent servant. In the present case there
is no rule under which the respondents may be deemed to have
become permanent by force of such rule nor they were so
declared by any subsequent order of the appellant-company to
have acquired that status. On the contrary the respondents
all along continued to be temporary and according to the
terms of the order of appointment their services could be
terminated at any time without any notice or assigning any
reasons. In such a case it is not necessary to follow the
formalities contemplated by Article 311 of the Constitution.
In these facts and circumstances the High Court was not
right in holding that the respondents were entitled for
being heard before passing the said order of termination of
their services and that the order of termination was bad in
law on that account.
6. As regards the second ground the learned counsel
appearing for the appellant contended that the aPpellant-
corporation had prepared a project in January 1980 (a copy
of which is filed as Annexure-A in 8. this aPpeal) for the
development of handicrafts through Exhibitions and proposed
that five officers of junior manager rank and some sales-
girls/sales-men be appointed in that connection. But when
the Government came to know about the said project it
disapproved the same by order dated 1.4.89 (Annexure-B) and
directed that no appointments shall be made to the said post
without obtaining prior approval of the State Government.
The learned counsel for the appellant, therefore, contended
that the appointment of the respondents was made against the
directions of the State Government and while quashing the
order of the termination the High Court did not take into
consideration the said directions of the State Government.
7. It may be pointed out here that the aPPellant-
corporation is a Government company fully financed by the
State Government and that being so the Government would be
very much concerned to see that any project which is not
economically beneficial for the corporation and which is
likely to result in any loss should not be given effect to.
The Government, therefore. would be justified in issuing
instructions that no aPpointments of any staff in connection
with the said project will be made without the aPproval of
the Board of Directors of M.P. Hasta Shilpa Vikas Nigam
Limited and passed the order to that effect which has been
filed as Annexure-B in this appeal. But it appears that
the High Court ignored the said order of the State
Government while observing that no material in support of
the contention that the Government has issued instructions
not to make aPpointment was produced by the appellant_
8. It is note worthy that Shri K.P. Thakur. the then
Managing Director
202
himself was retiring on 31.7.89 and in hot haste he issued
the orders of appointment of the respondents on 6.7.89 and
8.6.89 inspite of the instructions of the State Government
to the contrary. In these facts and circumstances the
impugned order passed by the High Court quashing the
termination of service of the respondents can not be
sustained.
9. In the result the appeal succeeds and is hereby
allowed. The impugned order dated 1.12.93 passed by the
High Court in Misc. Petition No. 3973/89 is set aside and
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 4
the said writ petition is dismissed but without any order as
to costs.
204