Tripura HC Reinstates Contract Project Officer With Full Back Wages, Says She Couldn’t Be Replaced By Another Contract Hire

SoFED, a State-sponsored society and the Project Implementing Agency for the Indo-German Development Cooperation Project (CREFLAT), appointed the appellant as Project Implementing Officer (PIO) on a contractual basis in 2021.

Her engagement was extended periodically, and the Project Director assigned her project duties, including monitoring work across five subdivisions.

In August 2025, those duties were reassigned to another employee; the appellant was then directed to assist a junior officer.

SoFED extended her engagement only until 25 September 2025, after which it was not renewed.

The appellant challenged her discontinuance, alleging arbitrariness and gender discrimination, and sought re-engagement and the quashing of a recruitment notification for the PIO post.

The Single Judge dismissed her petition, treating her as outsourced personnel and considering her claim primarily as one for regularisation.

The appellant appealed.

Article 14 of the Constitution prohibits arbitrary State action, and a State instrumentality’s contractual decisions remain subject to judicial review on that basis.

Clause 2.7 of the CREFLAT Project Operation Manual distinguishes personnel engaged directly on contract by the Project Management Agency from personnel engaged through an outsourcing agency; under Clause 2.7.2, disengagement for serious misconduct is subject to principles of natural justice.

In Swati Priyadarshini v. State of Madhya Pradesh, (2024) 19 SCC 128, the Supreme Court held that the true character of a termination or non-renewal must be assessed by examining its substance and surrounding circumstances, not merely its form; a stigmatic decision may require procedural fairness.

The Court also applied Uttar Pradesh Junior High School Council Instructor Welfare Association v. State of Uttar Pradesh, (2026) 5 SCC 321, for the principle that a contractual employee should not be replaced by another contractual employee.

The appointment letter showed that SoFED directly appointed the appellant on contract, while the Project Director assigned her duties, assessed her work, and issued performance-related documents; the Court therefore rejected the respondents’ claim that she was merely outsourced personnel.

SoFED was a State instrumentality, making the challenge to its action maintainable.

The appellant’s earlier performance records were favourable, and no contemporaneous warning or show-cause notice had been issued about alleged deficiencies before her duties were reassigned and her engagement ended.

The Court found the later performance appraisal unreliable in light of the circumstances in which it was prepared and approved, and treated the asserted performance grounds as stigmatic; the respondents had not followed natural justice.

The Court further noted that the respondents had advertised the PIO post on a contractual basis after discontinuing the appellant, contrary to the rule against replacing one contractual employee with another.

It allowed the appeal, set aside the Single Judge’s judgment, quashed the recruitment notification insofar as it concerned the PIO post, and directed the respondents to reinstate the appellant as PIO with full back wages.

Respondent No. 5 was also directed to pay the appellant costs of ₹15,000 within four weeks.