Expiry of a contractual term creates no enforceable right to renewal or reinstatement.

The petitioner was appointed as a Sub-Engineer (Zila Level) on a contractual basis on 04.10.2012 and was subsequently transferred from Tikamgarh to Bhind on 22.09.2018.

His contractual engagement was extended periodically, including for the year 2024–2025.

After receiving show-cause notices dated 08.01.2024 and 16.01.2025, and submitting replies, the petitioner’s contractual engagement was not extended for 2025–2026 by order dated 15.10.2025.

The order stated that, in the absence of a recommendation by the Collector, the contracts of certain contractual employees, including the petitioner, would not be renewed.

The petitioner challenged the non-renewal order, contending that it was stigmatic, non-speaking, and issued without a regular departmental inquiry under Clause 7.2 of the MGNREGA policy.

His departmental appeal was rejected on 24.03.2026.

1. Whether the petitioner, whose contractual period had expired, could claim a legal right to renewal, reappointment, or reinstatement in service?

2. Whether the order declining extension of the petitioner’s contractual engagement was stigmatic or punitive, thereby requiring a regular departmental inquiry?

3. Whether the High Court could issue a writ of mandamus directing the State to extend the petitioner’s contractual tenure or continue him in service?

The Court applied Article 226 of the Constitution and the settled principle that a contractual employee has no vested or enforceable right to renewal, reappointment, regularisation, or continuation merely because the contract was extended repeatedly or the employee served for several years.

Relying on Brijendra Gupta v. State of M.P., the Court held that repeated extension of a contractual term does not create a right to continued employment.

It also relied on Prem Chand Yadav v. Madhya Pradesh Madhya Kshetra Vidyut Vitaran Co. Ltd., which held that, after expiry of the contractual period, the employer cannot be compelled to continue the employee because extension remains the employer’s prerogative.

The Court further relied on Secretary, State of Karnataka v. Uma Devi, (2006) 4 SCC 1, for the proposition that long contractual service does not create a right to regularisation or continuation in the absence of a legally enforceable policy or statutory provision.

Clause 1.3 of the MGNREGA Contract Employees’ New Service Conditions Instructions, 2025, was understood as permitting renewal on the basis of satisfactory annual performance but not creating an automatic right to renewal.

The Court also applied the distinction between a punitive, stigmatic termination and a simpliciter decision not to renew a fixed-term contract.

The Court held that the petitioner’s contractual term had come to an end and that renewal was conditional, not automatic.

Although the petitioner had served since 2012 and had received successive extensions, neither the length of service nor prior renewals created an enforceable right to continuation.

The applicable instructions contemplated a one-year contractual tenure, which automatically ended on expiry, subject to the competent authority’s discretion to renew where the prescribed conditions were satisfied.

The order dated 15.10.2025 merely recorded the decision not to extend the contracts and did not contain any adverse allegation or finding of misconduct against the petitioner; it was therefore simpliciter and non-stigmatic.

Consequently, a regular departmental inquiry was not necessary for the non-renewal of the contract.

The Court nevertheless directed that any blameworthy observations contained in the appellate order should not be treated as findings of misconduct, disqualification, or adverse entries against the petitioner in future employment.

It held that, after expiry of the contractual period, the petitioner had no enforceable right to renewal, reappointment, reinstatement, or consequential benefits, and that the employer could not be compelled by mandamus to extend the contract.

The non-renewal order dated 15.10.2025 was treated as a simpliciter decision without stigma and did not require a regular departmental inquiry.

The writ petition was accordingly dismissed as devoid of merit.

However, adverse observations in the appellate order were directed not to be treated as findings of misconduct or as a disqualification or adverse entry in relation to the petitioner’s future employment.