Full Judgment Text
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PETITIONER:
INDRA KUMAR CHOPRA ETC.
Vs.
RESPONDENT:
PRADESHIK CO. OPERATIVE DAIRY FEDERATION LTD. ANDORS.
DATE OF JUDGMENT06/08/1992
BENCH:
YOGESHWAR DAYAL (J)
BENCH:
YOGESHWAR DAYAL (J)
SHARMA, L.M. (J)
PUNCHHI, M.M.
CITATION:
1992 AIR 2093 1992 SCR (3) 755
1992 SCC (4) 17 JT 1992 (4) 459
1992 SCALE (2)125
ACT:
Uttar Pradesh Cooperative Societies Act, 1965- Sections
122-A and 122-U.P. Cooperative Dairy Federation and Milk
Union Centralised Service Rules 1984-Rule 17(1) and (3)-U.P.
Cooperative Societies Employees Service Regulations 1975-
Para 17, 18, 19-Termination of provisionally absorbed
employee appointed to a temporary post upon creation of a
new service-Held, the post not being regular under
Regulation 17(1), and his status before he became such
absorbed employee not being relevant, termination valid.
HEADNOTE:
On 29 August, 1984, the U.P. Cooperative Dairy
Federation and Milk Union Centralised Service Rules 1984
were promulgated which created a new service known as U.P.
Cooperative and Dairy Federation and Milk Unions Centralised
Service which was to consist of all the managerial posts of
the Pradeshik Cooperative Dairy Federation Ltd., Lucknow and
the Cooperative Milk Unions and Cooperative Milk Boards
within the Operation Flood II Project registered under the
1965 Act, with some exceptions. By Resolution dated 28
September, 1984, the 1975 Regulations were made applicable,
and the rules relating to probation, confirmation and
termination were extended to the employees in the new
service.
The appellant was appointed as Assistant Manager
(Quality Control) in the Cattle Feed Plant, Varanasi on 24
July, 1981 and placed on probation for a period of one year.
On 30 May, 1987 and 25 May, 1987, the appellant
received orders, by the first of which he was relieved by
the Dugadh Utpadak Sahkari Sangh Ltd., Agra, where he was
then posted, and was to report at the Pradeshik Cooperative
Dairy Federation Ltd., Head Office at the earliest. By the
second order, his services were terminated under Paras 17
(1) and 19 (A) of the 1975 Regulations by giving one month’s
salary. The appellant
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challenged the orders mainly on the ground that he was a
permanent employee having been finally absorbed in service
holding a regular post since 1981, in a clear vacancy after
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due selection.
The High Court, on consideration of the 1975
Regulations, the 1984 Rules, the appointment orders and the
facts of the case, held that the appellant continued in
service as a temporary employee, and that the services of
the appellant with the Federation had no relevance.
Dismissing the appeal, this Court,
HELD: 1. By Explanation to Regulation 17(1) no post
shall be deemed to be regular unless it is in existence
continuously for the last five years. The post of Manager
Grade III had been sanctioned only with effect from the
coming into force of the 1984 Rules. [766G]
Till the date of termination of the appellant’s service
even three years had not expired. Therefore the post which
he was holding could not be deemed to be a regular post.
[766H]
2. The status of an employee before he became an
employee of the Centralised Service created by the 1984
Rules, his terms and conditions were to be governed by the
1975 Regulations and he had to become a regular employee
once again. Having become an employee of the new service,
and since the post was not in existence continuously for
five years, it could not be treated as a regular post.
Consequently the services of the appellant is that of a
temporary employee. [767A-C]
Om Prakash Maurya v. Cooperative Sugar Factories
Federation, Lucknow, [1986] Supp SCC 95, referred to.
3. In view of Section 122-A of the 1965 Act and the
creation of the new Service under different Authority by the
1984 Rules and the provisions of Regulation 17 of the 1975
Regulations, the appellant had no choice but to take his
chance with the new authority. [767D]
4. Though the impugned order of termination does not
cast any stigma on the appellant which can be called by way
of punishment, in the counter-affidavit it was stated that
his work was unsatisfactory. [767E]
National Textile Workers Union & Ors. v. P.R. Ramakrishnan &
Ors.,
757
[1983] 1 SCC 228. The Govt. Branch Press & Ors. v.D.B.
Beliappa, [1979] 2 S.C.R. 458 = A.I.R. 1979 S.C. 429; Ajit
Singh & Ors. v. State of Punjab & Anr., [1983] 2 S.C.R. 517
Anoop Jaiswal v. Government of India & Anr., [1984] 2 S.C.C.
369, distinguished.
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 3321
and 3320 of 1990.
From the Judgment and Order dated 21.7.1989 of the Allahabad
High Court in W.P. No. 3845 and 4371 of 1987.
M.S. Ganesh and S. Murlidhar for the Appellants.
K.T.S. Tulsi, Addl. Solicitor General, Pradeep Misra
and Arun Sharma for the Respondents
The Judgment of the Court was delivered by
YOGESHWAR DAYAL, J. Civil Appeal 3321 of 1990 and Civil
Appeal 3320 of 1990 arise out of a common judgment of the
Allahabad High Court dated 21st July, 1989 passed in Writ
Petition No. 3845 of 1987:Indra Kumar Chopra v. State of
U.P. and others and Writ Petition No. 4371 of 1987: Ashwani
Kumar Jha v. Pradeshik Cooperative Dairy Federation Ltd.,
and another.
As the common questions of facts and law arise in both
the appeals, the same are being disposed of by a common
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judgment. For facility of reference we may deal with the
facts of the appeal of Indra Kumar Chopra.
The appellant, claiming himself to be a permanent
employee-Manager Grade-III (Quality Control) posted at
Dugadh Utpadak Sahkari Sangh Limited Agra, had challenged
the orders dated 30th May, 1985 and 25th May, 1987, passed
by the General Manager, Dugadh Utpadak Sahkari Sangh, Agra
and Chairman Administrative Committee of the said Sangh. By
the first order the appellant was relieved by the said Sangh
in the afternoon of 30th May, 1985 and to report at
Pradeshik Cooperative Dairy Federation Ltd., Head Office, at
the earliest and by the second order his services were
terminated under Paras 17(1) and 19(A) of the Uttar Pradesh
Cooperative Societies Employees Service Regulations, 1975
(hereinafter called ‘the 1975 Regulations’) by giving one
month’s salary in lieu of notice period.
758
The orders were impugned mainly on the ground that the
appellant was a permanent employee having been finally
absorbed in service holding a regular post since 1981, in a
clear vacancy after due selection, hence his services could
not be terminated without following the due process of law.
It was submitted before the High Court that the Regulations
under which the services of the appellant were terminated
would not apply in the case of the appellant as the same
apply to the employee on probation. On July 24, 1981, the
appellant was appointed as Assistant Manager (Quality
Control) in the Cattle Feed Plant, Varanasi and was placed
on probation for a period of one year after his joining. It
was pleaded that it was mentioned in the order that on the
expiry of the probation he will be confirmed provided the
period of probation is not extended by the Federation, at
its discretion without assigning any reason thereof: It was
alleged that he was appointed on one year’s probation which
was not extended and was satisfactorily concluded.
On 29th August, 1984 the Governor of Uttar Pradesh
issued a Notification promulgating the Uttar Pradesh
Cooperative Dairy Federation and Milk Union Centralised
Service Rules, 1984 (hereinafter called ‘the 1984 Rules’).
Rule 17(1) of the 1984 Rules provides as follows:-
"The employees of the Federation or Unions working
on the managerial posts on the date of enforcement
of these rules shall provisionally be deemed to be
members of the service."
Rule 17(3) of the 1984 Rules reads thus:
"The Committee shall screen such provisionally
absorbed employees......in accordance with the
qualifications and norms laid down by the
Registrar. If, as a result of such screening, a
provisionally absorbed employee is not found
suitable for final absorption in the service by the
Committee, his service in the Federation or Union
concerned, as the case may be, shall be determined
with effect from the date of communication of such
decision of the Committee."
The appellant contended that as a result of the
screening, the appellant was finally absorbed in the
service.
Rule 19 of the 1984 Rules makes provision for the
training of the
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members of the service. The appellant alleged that after
absorption he was sent for training at Government expenses
which he completed successfully. The appellant also
contended that his work, conduct and performance was always
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appreciated by superiors, as a result of which he was sent
as Manager Grade-III to Dugadh Utpadak Sahkari Sangh Ltd.,
Agra. While he was posted at Agra, he received the impugned
orders.
To the writ petition a detailed counter affidavit was
filed on behalf of respondent Nos. 2 and 3, by one Sh.
Sharad Tondan, who was Manager Grade-III in the office of
the Pradeshik Cooperative Dairy Federation Ltd., 29 - Park
Road, Lucknow. In this counter- affidavit the background of
the Service has been given. It was stated thus:
"A. That the Pradeshik Cooperative Dairy Federation
Ltd., (hereinafter referred to as Federation) is an
apex level Cooperative Society under the U.P.
Cooperative Societies Act, 1965.
B. That the Federation has been entrusted with the
implementation of the Operation Flood Scheme by the
State Government. The Scheme is sponsored by
National Dairy Corporation, the purpose of the
scheme is to procure milk from rural areas of the
State and market the milk and milk products in
urban areas. In all, 28 districts have been covered
under Operation Flood II scheme in three phased the
various milk unions have been established in these
districts will have separate identity but worked
under the guidance of the Federation which is an
agency for implementing the scheme.
C. That in the initial stage of member of persons
working in the Federation and several milk unions
were engaged in implementing the scheme. But later
on the centralised services were created under the
Centralised Services Rules and the persons working
on the Managerial post under the Federation and the
milk unions were given option for becoming member
of the service by way of appointing through
absorption.
E. That Uttar Pradesh Cooperative Dairy Federation
and Milk Unions Centralised Service Rules, 1984
(hereinafter referred to as ‘Rules’) inter alia
provide for the creation of Cadre
760
Authority and Administrative Committee and created
Uttar Pradesh Cooperative Dairy Federation and Milk
Union Centralised Service (hereinafter referred to
as ‘Service’)
F. That the Centralised Services as created by the
Rules 1984 consists of the following posts, their
category and their scales in the ascending order.
1. Manager Grade IV
2. Manager Grade III
3. Manager Grade II
4. Manager Grade I
5. General Manager
G. That after creation of the centralised service
under the rules for implementation of the Operation
Flood Scheme, the managerial posts under the
Federation were abolished and the persons working
on the managerial posts in the service of the
Federation were given option or their absorption in
the centralised service which is a new and
different services with that of services under the
Federation.
H. That under Rule 17 of the Rules the persons were
given option to give notice in writing to the
Secretary of the Committee for their non-absorption
into the services under the centralised services
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and the provisions were also made for determination
of the services of the employees who has given
option for not becoming a member of the services
and the persons who had given option for becoming a
member of the service were absorbed after found
suitable by the Screening Committee and in case
they are not found suitable, there services were
liable to termination. The provision for training
of the members of the service were also made in the
Rules.
1. Thus after framing of the centralised service
Rules in the year 1984, for implementation of the
Operation Flood-II Scheme which in itself a
temporary scheme, a number of
761
temporary posts of Manager Grade III were created
and the persons who were previously working in the
Federation or in the unions on the managerial posts
were appointed by way of absorption on those posts
under the appointing authority of Chairman of the
Administrative Committee. It is further stated the
service under the Cadre Authority are different
with that of service under the federation or the
Unions. It is a new services under the different
appointing authority under different terms of
service conditions. It is further stated that
either there was no post of Manager Grade-III in
the Federation and in the Union. It is
specifically stated that the service under the
Federation has no like whatsoever with that of the
services under the Cadre Authority.
J. That the Centralised Service Rules also provide
for framing or regulation enumerating service
conditions of the member of the service by the
Cadre Authority which are still under process of
framing. That in the meantime, the Committee by
means of Resolution decided to govern the services
condition of the members in accordance with the
U.P. Cooperative Employees Service Regulation under
the power derived from Rule 25."
It was further stated that by Resolution dated 20th
September, 1984 the Cadre Authority resolved that during the
implementation of Regulations being farmed under the 1984
Rules the service conditions of the members of the
Centralised Service shall be governed by the 1975
Regulations. It was also stated specifically that the post
of Manager Grade-III upon which the appellant was working
was not a regular post and hence the question of
confirmation did not arise and the appellant was only a
temporary employee. It was further pleaded that the work of
the appellant was not found upto the mark and the same was
found unsatisfactory by the appointing authority. It was
further alleged that on account of unsatisfactory work of
the answering respondents was put to financial loss and loss
of reputation.
The Division Bench of the High Court on consideration
of the 1975 Regulations, the 1984 Rules and looking at the
various appointment orders as well as facts of the case took
the view that the appellant continued to remain in service
as a temporary employee and negatived the contentions
762
of the appellant that as the appellant continued to remain
in service even after the completion of probationary period,
he would be deemed to be confirmed on the post which he was
holding. The Division Bench also took the view that the
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service of the appellant with the Federation had no
relevance and all that was concerned was the appellant’s
service under the Cadre Authority as per the 1984 Rules.
With these observations the High Court dismissed both the
writ petitions.
The service conditions of the appellant, who was
initially appointed by letter dated 24th July, 1981 as
Assistant Manager (Quality Control) With Pradeshik
Cooperative Dairy Federation Limited, 29 Park Road, Lucknow,
were governed by the 1975 Regulations. The 1975 Regulations
have been framed under Section 122 of the Uttar Pradesh
Cooperative Societies Act, 1965. The appellant was placed
on probation for a period of one year from the date of his
joining and would be confirmed provided the period of
probation had not been extended by the Federation at its
discretion as per the averments in the writ petition. The
1984 Rules were promulgated by the Governor of Uttar Pradesh
through the Notification dated 29the August, 1984. These
Rules were again framed in exercise of powers conferred by
section 122 A of the Uttar Pradesh Cooperative Societies
Act, 1965, as amended (hereinafter referred to as ‘the 1965
Act’). Section 122 A of the 1965 Act provides as under:-
122 A. CENTRALISATION OF CERTAIN SERVICE-
(1) Notwithstanding anything contained in this Act,
the State Government may by rules provide for the
creation of one more services of such employees of
such cooperative societies or class of cooperative
societies as the State Government may think fit,
common to such cooperative societies and prescribed
the method of recruitment, appointment, removal and
other conditions of service of persons appointed to
any such service.
(2) When any such service is created, all employees
of such societies existing on the date of creation
of such service on the posts included in such
service, shall be deemed to have been provisionally
absorbed in the service with effect from the date
of creation of such service:
Provided that any such employee may, by notice in
writing to
763
the prescribed authority within the prescribed
period, intimate his option of not becoming a
member of such service, and in that event his
service in the society shall stand determined with
effect from the date of such notice and he shall be
entitled to compensation from the society which
shall be-
(a) in the case of a permanent employee, a sum
equivalent to his salary (including all allowances)
for a period of three months or for the remaining
period of his service, whichever is less;
(b) in the case of a temporary employee, a sum
equivalent to his salary (including all allowances)
for a period of one month or for the remaining
period of his service, whichever is less.
(3) An employee provisionally absorbed under sub-
section (2) may be absorbed finally in the service
if found suitable after screening in accordance
with the instructions issued by the Registrar; and
the services of any such employee as is not found
suitable for absorption in the service shall stand
determined with effect from the date of issue of
orders in that behalf by the prescribed authority
and until such authority prescribed by the officer
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specified by the Registrar in that behalf in such
instructions and he shall be entitled to
compensation as laid down in clause (a) or clause
(b) of sub-section (2) according as he was a
permanent or a temporary employee."
As stated earlier, in exercise of the powers conferred
by Section 122 A of the 1965 Act the Governor of Uttar
Pradesh was pleased to make the 1984 Rules. These Rules
were notified by Notification dated 29th August, 1984 and
came into force from the same date. By virtue of these
Rules a new Service, known as Uttar Pradesh Cooperative
Dairy Federation and Milk Unions Centralised Service, was
created which was to consist of all the managerial posts of
the Pradeshik Cooperative Dairy Federation Ltd., Lucknow,
(including all its Units) and the Cooperative Milk Unions
and Cooperative Milk Boards falling within the area of
Operation Flood II project, registered under the 1965 Act,
except the posts of Managing Director, Chief Commercial
Manager and Chief General Manager of the Federation Rule
2(k) of the 1984 Rules defines -"Service" means the Uttar
Pradesh Co-operative Dairy Federation and Milk Unions
Centralised Service created under rule 3 of these Rules.
Apart from the provisions of
764
Section 122 A of the 1965 Act quoted earlier Section 17(1)
of the 1984 Rules also provided that the employees of the
Federation or Unions working on the managerial posts on the
date of enforcement of these Rules shall provisionally be
deemed to be members of the Service created by the 1984
Rules. Sub-rule (2) thereof gave an option to the employees
who have been included in the Service provisionally to
intimate for not becoming the member of the Service and in
that case his service shall be determined with effect from
the date of such notice and on such determination, in case
he was a permanent employee, he would be entitled to the
salary for a period of three months or for the remaining
period of service, whichever is less and in the case of a
temporary employee he would be entitled to only one month’s
salary or remaining period of service, whichever is less.
Sub-rule (3) of Rule 17 of the 1984 Rules provides for
screening of provisonally absorbed employee for final
absorption in the Service by the Committee. Rule 9 of the
1984 Rules contemplated the Authority under the Rules to
frame regulations relating to recruitment, training,
employments etc. and other conditions of service of the
members. Rule 25 of the 1984 Rules provides as follows:-
"25 (1) So long as the regulations referred to in
sub- rule (1) of rule 9 are not framed, all or any
matters referred to therein for which there is no
other specific provision in the rules, shall be
governed by such orders or directions as may be
issued by the Authority with the approval of the
Registrar.
(2) Any matter not covered by these rules shall be
governed by such directions as may be issued by the
Authority with the approval of the Government."
As mentioned earlier the Cadre Authority by means of a
Resolution dated 28th September, 1984 had resolved that the
service conditions of the members of the Service to be
governed by the 1975 Regulations till the new Regulations
are framed under the 1984 Rules.
It is clear from the counter-affidavit filed by the
respondents that the post of Manager Grade-III had been
sanctioned only with effect from the coming into force of
the 1984 Rules. Regulations 17, 18 and 19 of the 1975
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Regulations which became applicable by virtue of the
Resolution dated 28th September, 1984 provide as follow:-
765
"17 PROBATION
(i) All persons on appointment against regular
vacancies shall be placed on probation for a period
of one year:
Provided that the appointing authority may, in
individual cases, extend the period of probation in
writing by such further period not exceeding one
year, as it may deem fit.
Explanation: No post shall be deemed as regular
unless it has been in existence continuously for
the last five years.
(ii) If, at any time during or at the end of the
period of probation or the extended period of
probation, it appears to the appointing authority
that a person placed on probation, has not made
sufficient use of the opportunity offered to him,
or has otherwise failed to give satisfaction, he
may be discharged from service, or reverted to the
post held by him substantively, if any immediately
before such appointment
(iii) A person discharged from service during or at
the end of the period of probation or the extended
period of probation under clause (ii) shall not be
given any compensation unless, under mandatory
provisions of any law applicable to his case, he is
entitled to the same.
18. CONFIRMATION
(i) Confirmation of an employee shall, on the
satisfactory conclusion of the probationary period,
be made by the appointing authority if the post is
regular one in terms of the preceding regulation.
(ii) Where a person holding a post not being a
regular one, has not been treated as on probation
in terms of Regulation No. 17(i), the question of
confirmation shall not arise.
Explanation: If doubt arises whether a particular
post in a particular cooperative society is
‘regular’ or not and the matter is not sub-judice,
it shall be referred to the Board, whose decision
shall be final.
766
(iii) Where the number of posts on which
confirmation has to be made are less than the
persons eligible for the same, confirmation shall
be made on the basis of seniority subject to
rejection of the unfit.
19. TERMINATION-Services of an employees shall be
terminable:-
(a) In case of a temporary employee, on one month’s
notice in writing on either side, or in lieu
thereof by payment of one month’s salary by the
party which gives notice:
Provided that in case of direct appointments made
for a specific period, it shall not be necessary to
give any notice or any pay in lieu thereof.
Explanation : ‘Specific period’ means stated period
of less than six months.
(b) by three months’ notice in writing on either
side in case of a confirmed employee.
Explanation :- (1) A notice given by an employee
under Regulation No. 19 shall be deemed to be
proper only if he remains on duty during the period
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of the notice:
Provided that the employee may be allowed on
request to avail such portion of earned leave as
may be due to him which shall however not exceed
the notice period.
(2) The expression ‘month’ used in this regulation
shall be a period of thirty days commencing on the
date immediately following the date on which the
notice is received by the employee or the
appointing authority, as the case may be."
It is clear from the Explanation to Regulation 17(1)
that no post shall be deemed to be regular unless it is in
existence continuously for the last five years. Till the
date of termination of the appellant’s service even three
years had not expired. Therefore the post which the
appellant was holding could not be deemed to be the regular
post. Once the post is not regular, Regulation 17 would not
be applicable. We are, therefore, concerned only
767
with Regulation 19(a) of the 1975 Regulations.
It is clear to us that whatever may be the status of an
employee before he became a provisionally absorbed employee
of the service, namely - the Centralised Service created by
the 1984 Rules, his terms and conditions were to be governed
by the 1975 Regulations and he had to become a regular
employee once again and if he was not willing, he could
stay on with the Federation and Section 122 A of the 1965
Act provided the consequences for terminating the services
of both regular as well as temporary employees. Having
become the employee of the new service and since the post
was not in existence continuously for the last five years of
its creation, it could not be treated as a regular post.
Consequently the services of the appellant is that of a
temporary employee. In this view of the matter we do not
find it necessary to go into the question of the status of
the appellant while he was working with the Federation and,
therefore, we have not gone into the applicability of the
decision of this Court in the case of Om Prakash Maurya v.
U.P. Cooperative Sugar Factories Federation, Lucknow and
others, [1986] Supp SCC 95 which directly deals with the
interpretation of Regulation 17 of the 1975 Regulations. In
fact in view of Section 122 A of the 1965 Act and the
creation of the new Service under different Authority by the
1984 Rules and the provisions of Regulation 17 of the 1975
Regulations, the appellant had no option but to take his
chance with the new Authority. Though the impugned order of
termination does not cast any stigma on the appellant which
can be called by way of punishment, in the counter-
affidavit, it was stated that the appellant’s work was
unsatisfactory. Before us the averments made in the counter-
affidavit were not challenged on behalf of the appellants.
The impugned order of termination of service as a
temporary employee was challenged on the ground that it was
passed by way of punishment in the written note of arguments
and following cases were referred to:
National Textile Workers Union and others v.P.R.
Ramakrishnan and other, [1983] 1 SCC 228; The Govt. Branch
Press and another v. D.B. Belliappa, [1979] 2 SCR 458 = AIR
1979 SC 429; Ajit Singh and others v. State of Punjab and
another, [1983] 2 SCR 517 and Anoop Jaiswal v. Government of
India and another, [1984] 2 SCC 369.
None of these cases are applicable to the facts of the
present case.
768
The first case relates to the right of the workman in the
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winding up petition. The second case was found to be the
case of discrimination in the method of termination. The
third case was peculiar to its own facts inasmuch as the
permanent posts in Improvement Trusts were abolished and the
termination of the employees were on the basis of the
abolition of these posts but same posts were created
thereafter. The decision of the last case was on facts
found by this Court as punitive in nature against a member
of an Indian Police Service.
We are in complete agreement with the reasoning and
conclusion of the Division Bench of the High Court. The
appeals consequently fail and are dismissed without any
order as to costs.
U.R. Appeal dismissed.
769