* IN THE HIGH COURT OF DELHI AT NEW DELHI DHARMENDRA PRASAD SINGH & ORS. versus. THE CHAIRMAN, STATE BANK OF INDIA & ORS...

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1 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) No. 4061/2013 % 11 th September, 2015 DHARMENDRA PRASAD SINGH & ORS.... Petitioners Through: Ms.Adwaita Sharma and Mr. Junaid Nahvi, Advocates. versus THE CHAIRMAN, STATE BANK OF INDIA & ORS.... Respondents Through: Mr. Rajiv Kapur, Adv. for R-1/SBI. CORAM: HON BLE MR. JUSTICE VALMIKI J.MEHTA To be referred to the Reporter or not? VALMIKI J. MEHTA, J (ORAL) Review Petition No. 301/ The main writ petition was dismissed by this Court by a detailed judgment running into 45 pages on The judgment dated relied upon the Constitution Bench judgment of the Supreme Court in the case of Secretary, State of Karnataka Vs. Umadevi & Ors. (2006) 4 SCC 1 for holding that after passing of this judgment by the Constitution Bench of the Supreme Court, neither the Union of India or a State or any arm of the State or any authority or entity of a State under Article 12 of the W.P.(C) No. 4061/2013 Page 1 of 17

2 Constitution of India could take out a policy for regularization of contractual employees who have been appointed without issuing of advertisements to call candidates by open competition or advertisements have been issued only for contractual periods/posts and not for regular/permanent posts. 2. The judgment passed by this Court on was set aside by a Division Bench of this Court on The Division Bench while passing the judgment dated did not notice and refer to the specific paragraphs which were quoted by this Court (in its judgment dated ) of the judgment of the Constitution Bench of the Supreme Court in Umadevi s case (supra) and which paras were the ratio of Umadevi s case (supra). The Division Bench by the judgment dated effectively has held that the respondent no.1/state Bank of India though it is an arm of the State as per Article 12 of the Constitution of India, can take out policy for regularizing contractual employees. I may also note that the appeal before the Division Bench was filed by the respondent no.1 ie State Bank of India and whose policy of regularizing contractual employees was held by this Court to be illegal and violative of the ratio of the Constitution Bench judgment of the Supreme Court in the case of Umadevi (supra). The LPA No. 260/2015 which was allowed by the Division Bench of this Court by its W.P.(C) No. 4061/2013 Page 2 of 17

3 judgment dated was without issuing any notice to the petitioners in the writ petition, and who were arrayed as respondents no.1, 2 and 3 in the LPA, and the LPA was disposed of at the stage when it came up for admission for the first time. 3. The facts of the present case are very peculiar, in that both the petitioners and who are the review petitioners, as also the respondent no.1/bank, claimed right for regularization of contractual employees and therefore both the review petitioners as also the respondent no.1/bank were interested in impugning the judgment passed by this Court on Obviously, it is for this reason that there is no further challenge by any of the parties to the judgment of the Division Bench dated in LPA No. 260/15. The Division Bench as per its judgment held that the policy of the respondent no.1/bank dated of regularizing contractually appointed employees was not in violation of the ratio of the Constitution Bench judgment of the Supreme Court in the case of Umadevi (supra), however, since the Division Bench passed the judgment without issuing any notice to the review petitioners/petitioners, and consequence of which judgment would be a direction to this Court to decide the writ petition on merits, hence the petitioners have filed the present review petition seeking W.P.(C) No. 4061/2013 Page 3 of 17

4 their regularization on the posts in terms of the policy dated of the respondent no.1/bank. 4. When the review petition and the connected applications came up before this Court for the first time on , this Court passed the following detailed order:- 1. This writ petition was dismissed by this Court vide this judgment dated The respondent no.1/state Bank of India carried this judgment in appeal in LPA No.260/2015 and this appeal was allowed by the Division Bench vide its judgment dated setting aside the judgment of this Court. By the judgment dated , this Court had held that the respondent no.1 cannot bring out a policy to regularize contractual appointees/employees, but, the Division Bench held that respondent no.1 is entitled to take out a policy to regularize the contractual appointees. 2. After I passed the judgment in this case on I have passed two other judgments in the case of Keshav Dutt and Ors. Vs. Delhi Tourism and Transport Development Corporation Limited & Anr. in W.P.(C) No.3295/2015 decided on and a bunch of cases with lead case being Dr. Parmod Kumar Dhailwal Vs. GNCT of Delhi & Ors. W.P.(C) No.7942/2014 decided on These cases decided by this Court of Keshav Dutt and Ors. (supra) and Dr. Parmod Kumar Dhailwal (supra) refers to four judgments of the Supreme Court and which judgments specifically lay down the ratio that contractual employees even appointed through advertisement cannot be regularized in services, inasmuch as, the same would amount to violating Articles 14 and 16 of the Constitution of India and the ratio of the judgment of the Constitution Bench of the Supreme Court in the case of Secretary, State of Karnataka and Others Vs. Umadevi and Others 2006 (4) SCC 1. These four judgments of the Supreme Court are as under:- (i) Official Liquidator Vs. Dayanand & Ors. (2008) 10 SCC 1. (ii) National Fertilizers Ltd. and Others Vs. Somvir Singh (2006) 5 SCC 493. W.P.(C) No. 4061/2013 Page 4 of 17

5 (iii) Kendriya Vidyalaya Sangathan and Others Vs. L.V. Subramanyeswara and Another (2007) 5 SCC 326. (iv) State of Orissa and Another Vs. Mamata Mohanty (2011) 3 SCC The relevant portions of the aforesaid four judgments directly on the issue that contractual employees cannot be regularized in the absence of appropriate advertisement i.e advertisement for permanent posts, are as under:- (I) Relevant para from the case of Official Liquidator (supra) 52. As mentioned above, while approving the reasons and conclusions recorded by the two High Courts and dismissing the appeals, this Court not only permitted the Government of India to frame a scheme modeled on the 1978 Scheme but also stayed implementation of the orders impugned in the appeal and the one passed by itself in the transferred writ petition. If the Court intended that all members of the company paid staff working on the date of judgment i.e should be absorbed in the regular cadres against Group `C' and `D' posts, then a simple direction to that effect would have been sufficient and there was no occasion to stay the implementation of the orders of the High Courts for six months with liberty to the Government of India to frame a new scheme within the same period. The absence of such a direction shows that the Court was very much conscious of the fact that recruitment to the regular cadres is governed by the rules framed under Article 309 of the Constitution and it would be highly detrimental to public interest to issue direction for wholesale absorption/regularization of the company paid staff and thereby abrogate/stultify opportunity of competition to younger generation comprising more meritorious persons who may be waiting for a chance to apply for direct recruitment. Obviously, the Court did not want to sacrifice the merit by showing undue sympathy with members of the company paid staff who joined service with full knowledge about their status, terms and conditions of their employment and the fact that they were to be paid from the company fund and not Consolidated Fund of India. In this context, we may also mention that though the Official Liquidators appear to have issued advertisements for W.P.(C) No. 4061/2013 Page 5 of 17

6 appointing the company paid staff and made some sort of selection, more qualified and meritorious persons must have shunned from applying because they knew that the employment will be for a fixed term on fixed salary and their engagement will come to an end with the conclusion of liquidation proceedings. As a result of this, only mediocres must have responded to the advertisements and jointed as company paid staff. In this scenario, a direction for absorption of all the company paid staff has to be treated as violative of the doctrine of equality enshrined in Articles 14 and 16 of the Constitution. (emphasis added) II. Relevant paras from the case of National Fertilizers Ltd. and Others (supra) 20. The Constitution Bench opined that any appointment made in violation of the Recruitment Rules as also in violation of Articles 14 and 16 of the Constitution would be nullity. The contention raised on behalf of the employees that those temporary or ad hoc employees who had continued for a fairly long spell, the authorities must consider their cases for regularisation was answered, thus: [Umadevi (3) Case (supra), SCC p.29, para 26] 26. With respect, why should the State be allowed to depart from the normal rule and indulge in temporary employment in permanent posts? This Court, in our view, is bound to insist on the State making regular and proper recruitments and is bound not to encourage or shut its eyes to the persistent transgression of the rules of regular recruitment. The direction to make permanent -- the distinction between regularization and making permanent, was not emphasized here -- can only encourage the State, the model employer, to flout its own rules and would confer undue benefits on a few at the cost of many waiting to compete. With respect, the direction made in paragraph 50 of State of Haryana v. Piara Singh: (1992) 4 SCC 118 are to some extent inconsistent with the conclusion in paragraph 45 therein. With great respect, it appears to us that the last of the directions clearly runs counter to the constitutional scheme of employment recognized in the earlier part of the decision. Really, it cannot be said that W.P.(C) No. 4061/2013 Page 6 of 17

7 this decision has laid down the law that all ad hoc, temporary or casual employees engaged without following the regular recruitment procedure should be made permanent. 21. It was furthermore opined: [Umadevi (3) Case (supra), SCC p.32, para 33] 33. It is not necessary to notice all the decisions of this Court on this aspect. By and large what emerges is that regular recruitment should be insisted upon, only in a contingency an ad hoc appointment can be made in a permanent vacancy, but the same should soon be followed by a regular recruitment and that appointments to non-available posts should not be taken note of for regularization. The cases directing regularization have mainly proceeded on the basis that having permitted the employee to work for some period, he should be absorbed, without really laying down any law to that effect, after discussing the constitutional scheme for public employment. 22. Taking note of some recent decisions of this Court, it was held that the State does not enjoy a power to make appointments in terms of Article 162 of the Constitution of India. It further quoted with approval a decision of this Court in Union Public Service Commission v. Girish Jayanti Lal Vaghela:(2006) 2 SCC 482 in the following terms: (SCC p. 490, para 12) The appointment to any post under the State can only be made after a proper advertisement has been made inviting applications from eligible candidates and holding of selection by a body of experts or a specially constituted committee whose members are fair and impartial through a written examination or interview or some other rational criteria for judging the inter se merit of candidates who have applied in response to the advertisement made. A regular appointment to a post under the State or Union cannot be made without issuing advertisement in the prescribed manner which may in some cases include inviting applications from the employment exchange where eligible W.P.(C) No. 4061/2013 Page 7 of 17

8 candidates get their names registered. Any regular appointment made on a post under the State or Union without issuing advertisement inviting applications from eligible candidates and without holding a proper selection where all eligible candidates get a fair chance to compete would violate the guarantee enshrined under Article 16 of the Constitution. It was clearly held: [Umadevi (3) case (supra), SCC p.35, para 41] These binding decisions are clear imperatives that adherence to Articles 14 and 16 of the Constitution is a must in the process of public employment. (emphasis added) III Relevant para from Kendriya Vidyalaya Sangathan and Others (supra) 10. Had such regular vacancies been created, appellants would have been directed to be appointed on All India Basis. Respondents did not get their names registered in the Central Employment Exchange. Keeping in view the nature of the job and in particular that the posts are transferable throughout the country, an opportunity within the meaning of Articles 14 and 16 of the Constitution of India would mean an opportunity to all who are eligible therefore. Advertisement was issued for a limited purpose, namely, for leave vacancies, local employment exchanges were contacted only for filling of such posts and not regular posts. (underlining added) IV Relevant paras 35 and 36 from the case of Mamata Mohanty (supra) 35. At one time this Court had been of the view that calling the names from Employment Exchange would curb to certain extent the menace of nepotism and corruption in public employment. But, later on, came to the conclusion that some appropriate method consistent with the requirements of Article 16 should be followed. In other words there must be a notice published in the appropriate manner calling for applications and all those who apply in response thereto should be considered fairly. Even if the names of candidates are requisitioned from Employment Exchange, in addition W.P.(C) No. 4061/2013 Page 8 of 17

9 thereto it is mandatory on the part of the employer to invite applications from all eligible candidates from the open market by advertising the vacancies in newspapers having wide circulation or by announcement in Radio and Television as merely calling the names from the Employment Exchange does not meet the requirement of the said Article of the Constitution. (Vide Delhi Development Horticulture Employees' Union v. Delhi Admn., : AIR 1992 SC 789, State of Haryana v. Piara Singh : AIR 1992 SC 2130, Excise Supdt. v. K.B.N. Visweshwara Rao : (1996) 6 SCC 216, Arun Tewari v. Zila Mansavi Shikshak Sangh : AIR 1998 SC 331, Binod Kumar Gupta v. Ram Ashray Mahoto : AIR 2005 SC 2103, National Fertilizers Ltd. v. Somvir Singh : AIR 2006 SC 2319, Telecom District Manager v. Keshab Deb : (2008) 8 SCC 402, State of Bihar v. Upendra Narayan Singh : (2009) 5 SCC 65 and State of M.P. v. Mohd. Abrahim : (2009) 15 SCC 214.) 36. Therefore, it is a settled legal proposition that no person can be appointed even on a temporary or ad hoc basis without inviting applications from all eligible candidates. If any appointment is made by merely inviting names from the Employment Exchange or putting a note on the Notice Board etc. that will not meet the requirement of Articles 14 and 16 of the Constitution. Such a course violates the mandates of Articles 14 and 16 of the Constitution of India as it deprives the candidates who are eligible for the post, from being considered. A person employed in violation of these provisions is not entitled to any relief including salary. For a valid and legal appointment mandatory compliance of the said Constitutional requirement is to be fulfilled. The equality clause enshrined in Article 16requires that every such appointment be made by an open advertisement as to enable all eligible persons to compete on merit. (underlining added) 4. No doubt, it would appear that I am bound by the judgment of the Division Bench in this case by which the judgment passed by this Court on has been set aside and thereby the Division Bench has held that policy of regularization of contractual appointees by the respondent no.1 is not illegal, however, the issue to be examined is that whether the Division Bench judgment would bind this Court in case the Division Bench has not noticed the direct ratios of the four W.P.(C) No. 4061/2013 Page 9 of 17

10 judgments of the Supreme Court reproduced above, and especially in the case of Official Liquidator (supra) which is identical to the issue in hand of dis-entitlement of State or its organization to regularize contractual appointees. By examining the case on merits of allowing the writ petition, I would be following the judgment of the Division Bench dated but possibly I may be violating the direct ratios of the four judgments of the Supreme Court which have been quoted above. 5. I have put my predicament to the counsel for the parties that if I would be following the Division Bench judgment of this Court dated in LPA No.260/2015, then, I may possibly be violating the ratios of the four judgments of the Supreme Court stated above and which categorically hold that contractual appointees appointed after advertisement cannot be regularized if appointments are pursuant to the advertisement which are issued only for contractual term based appointments. 6. Counsel for the parties will assist the Court as to the procedure to be followed by this Court in peculiar facts of this case as to whether this Court should decide the matter or whether this Court ought to refer the matter to a larger Bench than the Division Bench which has passed the judgment dated in LPA No.260/ List on 1 st July, A reference to the Order dated shows that the predicament of this Court that the Division Bench judgment dated in LPA No. 260/2015 if was held to be binding, then the same would lead to violation by this Court of the specific and direct ratios of as many as four judgments of the Supreme Court which are referred to in sub-paras (i) to (iv) of para 2 of the Order dated and none of which four judgments find reference in the Division Bench judgment dated , and which four judgments followed the ratio laid down by the Supreme Court in the W.P.(C) No. 4061/2013 Page 10 of 17

11 case of Umadevi (supra) by holding that no policy of regularization of contractual employees can be taken out unless the contractual employees were called in open competition through advertisements for posts which were to be regular and not contractual period posts. I may note that it is an admitted fact appearing on record that persons who are recruited through the policy dated of the respondent no.1/bank were recruited not by advertisements of the posts as regular and permanent posts but advertisements were only for appointment of persons for limited periods to the contractual posts, and such a policy as per the four Supreme Court judgments stated in para 2 of the Order dated could not have been made by the respondent no.1/bank. 6. In view of the aspect that no doubt the judgment of the Division Bench of this Court would be binding on me, but I would in fact be bound equally by the four judgments of the Supreme Court noted in para 2 of the Order dated and which have not been referred to by the Division Bench in its judgment dated , hence after noticing of the aspect I request assistance of the counsels for the parties as to what should be the course of action which has to be adopted by this Court. Today, the review petitioners/petitioners state that they agree that the matter be referred to a W.P.(C) No. 4061/2013 Page 11 of 17

12 Full Bench of this Court as to whether this Court is bound and must decide the writ petition on merits because of the judgment of the Division Bench dated or this Court is not bound ie the Division Bench judgment dated is per incuriam in view of the four direct judgments of the Supreme Court on this subject/aspect and as referred to in para 2 of the Order dated Counsel for respondent no.1/bank very vehemently argues that this Court is bound by the judgment of the Division Bench dated and therefore this matter cannot be referred to the Full Bench, however, I have already narrated the facts in detail above and it is noted that by deciding the writ petition on merits though I would be following the judgment of the Division Bench dated , but I will be definitely violating the direct and categorical ratios of the four judgments of the Supreme Court as stated in para 2 of the Order dated , and therefore, I do not agree with the counsel for the respondent no.1/bank that the present matter so far as the issue of law is concerned cannot be referred to a Full Bench. Counsel for the respondent no.1/bank in support of his arguments refers to a judgment of the Supreme Court in the case of Bharat Petroleum Corpn. Ltd. Vs. Mumbai Shramik Sangha and Ors. (2001) 4 W.P.(C) No. 4061/2013 Page 12 of 17

13 SCC 448. In this judgment the Supreme Court has held that a bench of a lesser number of judges of the Supreme Court cannot go against a judgment of a larger number of judges even if the judgment of the larger number of judges is doubted by the Division Bench of lesser number of judges. In this judgment the Supreme Court holds that Two-Judge Bench is bound by the Constitution Bench of Five Judges even if the judgment of the Constitution Bench of Five Judges is doubted by the Division Bench of Two Judges. 8. In my opinion, the contention urged on behalf of respondent no.1/bank is unsound by placing reliance on the judgment of Bharat Petroleum s case (supra) for various reasons. Firstly, in the present case, it is not the issue that a judgment of a larger bench is not held to be binding on this Court, but what is in issue is whether the categorical ratios laid down in four Supreme Court judgments prevail or the ratio of the judgment of a Division Bench of a High Court prevails though the Division Bench judgment of the High Court does not notice the ratios of the four categorical judgments of the Supreme Court laying down the ratio that contractual employees cannot be regularized if contractual employees have been appointed against posts which were not advertised as regular and permanent posts. Also, in fact, the judgment relied upon by the respondent no.1/bank W.P.(C) No. 4061/2013 Page 13 of 17

14 goes against the respondent no.1/bank because it says that a Division Bench of lesser number of judges of the Supreme Court cannot violate the ratio of a Constitution Bench judgment of the Supreme Court, and if that is so, then surely a Division Bench of a High Court cannot cause violation of the four judgments of the Supreme Court as referred to in para 2 of the Order dated The procedural provisions which are applicable to this Court for referring the matter to a larger bench are contained in Punjab High Court Rules Volume 5 as applicable to this Court and the relevant provision in this regard is contained in Chapter 3 Part-B, Rule 1 last proviso (b) and which provision reads as under:- 1. Cases ordinarily to be heard by a single Judge-Subject to the proviso hereinafter set forth the following classes of cases shall ordinarily be heard and disposed of by a Judge setting alone:.. Provided that- (a) a Judge may, if he thinks fit, refer any matter mentioned in any of the clauses of this rule other than clauses (x), (xviii) or (xx) and with the sanction of the Chief Justice, any matter mentioned in clauses (xvii) and (xx) to a Division Bench of two judges; (b) a Judge before whom any proceeding mentioned in clause (xviii) is pending, may, with the sanction of the Chief Justice, obtain the assistance of any other Judge or Judges for the hearing and determination of such proceeding or of any question or questions arising therein. (underlining added) W.P.(C) No. 4061/2013 Page 14 of 17

15 10. A reference to the aforesaid Rule as applicable to this Court shows that on issues such as the present, as to whether this Court should decide cases which would result in direct violation of the ratios laid down by the Supreme Court in its judgment, and which would be done if this Court has to decide the writ petition on merits pursuant to the judgment of the Division Bench dated , is an issue which has necessarily to be determined by a Full Bench of this Court inasmuch as, the direct and categorical ratios of the four judgments of the Supreme Court stated in para 2 of the Order dated have escaped the notice of the Division Bench which decided LPA No. 260/2015 by its judgment dated At the cost of repetition, it may be noted that the Supreme Court in the four judgments referred to in para 2 of the Order dated has categorically laid down the ratio that contractual employees who are appointed not by means of advertisements for their employment to regular and permanent posts, cannot be regularized by means of an administrative policy and such a direction for regularization would clearly be violative of the provisions of Articles 14 and 16 of the Constitution of India. The relevant paras of the four judgments of the Supreme Court stated in para 2 of the Order dated are contained in para 3 of the said Order dated , and which para has already been reproduced above. W.P.(C) No. 4061/2013 Page 15 of 17

16 11. The following issues are thus framed for decision by a Full Bench of this Court in terms of the provision contained in Chapter 3 Part-B, Rule 1 last proviso (b) of the Punjab High Court Rules Volume 5:- (i) Whether a Single Judge of this Court is bound to decide a writ petition on merits on the basis of a judgment of a Division Bench of this Court setting aside the judgment of the Single Judge, although, the decision of the case on merits would have the effect of a Single Judge of this Court causing a violation of the direct and the categorical ratios of various judgments of the Supreme Court as referred to in paras 2 and 3 of the Order passed by this Court dated The specific issue is whether the Government or arm of the Government or an authority of the Government under Article 12 of the Constitution of India can frame a policy to regularize contractual employees and which contractual employees though have been called by advertisements, but, the advertisements were not for employment to regular and permanent posts but were for employment only for contractual periods in contractual posts.? AND (ii) Whether a Division Bench judgment of this Court which does not deal with the direct and categorical ratios of the judgments of the Supreme Court in the cases of (i) Official Liquidator Vs. Dayanand & Ors. (2008) 10 SCC 1; (ii) National Fertilizers W.P.(C) No. 4061/2013 Page 16 of 17

17 Ltd. and Others Vs. Somvir Singh (2006) 5 SCC 493; (iii) Kendriya Vidyalaya Sangathan and Others Vs. L.V. Subramanyeswara and Another (2007) 5 SCC 326; (iv) State of Orissa and Another Vs. Mamata Mohanty (2011) 3 SCC 436, is not per incuriam with respect to its ratio and operation /conclusion, and which judgment if followed will result in a Single Judge of this Court violating the ratios of the aforesaid four judgments of the Supreme Court? 12. Let this file be placed before Hon ble the Chief Justice for constitution of the Full Bench for answering the questions as stated above and since the Full Bench will be deciding the validity of the ratio laid down by the Division Bench of this Court in the judgment dated in LPA No. 260/2015, Hon ble the Chief Justice may kindly be pleased to constitute the Full Bench having Hon ble Judges who are not the Hon ble Judges who constituted the Benches which passed the judgments dated and Pursuant to the orders of Hon ble the Chief Justice, let the file of this writ petition be placed before the Full Bench of this Court on 30 th October, SEPTEMBER 11, 2015 VALMIKI J. MEHTA, J. ib W.P.(C) No. 4061/2013 Page 17 of 17