AHMEDABAD EDUCATION SOCIETYversusGILBER B. SHAH AND ORS

A                  AHMEDABAD EDUCATION SOCIETY
                                       v.
                        GILBER B. SHAH AND ORS~

                             DECEMBER 8, 2003

B               [S. RAJENDRA BABU AND RUMA PAL, JJ.]

         Service Law:

        Leave Rules of Ahmedabad Education Society-Rule 29-Bombay
  Primary Education (Gujarat Amendme11t) Rules, 1978-Schedule F, Rules
  34(1) and 34(3)-Teachers in private Primary Schools-Retirement Age--
   Teachers claiming continuance in service till the age-of 60 as per Rule 29
  of the Leave Rules-Society maintaining that teachers are to be retired at
  the age of 58 in accordance with Rule 34(1) of the Amendment Rules--
  Held, Leave Rules ji·amed by Society are terms of the contract of service
D applicable fO the teachers-Teachers being appointed on contractual terms
  for a definite period have a right to continue till the age of 60 by virtue
  of the Leave Rules-Amended Rules also exempt those persons who are
   'appointed for a definite period' from its ambit.

         A teacher in a Primary School owned by the Appellant Sodely
E was informed by the appellant that he would be retiring from service
    on completion of 58 years in accordance with Rule 34(1) in Schedule
    F of the Bombay Primary Education (Gujarat Amendment) Rules,
    1978. He filed a civil suit in the City Civil Court mainly seeking a
    declaration that his age of retirement was 60 as per Rule 29 of the
F   Leave Rules of Appellant Society and also prayed for other consequential
    relief. Some of the respondents herein impleaded themselves as partfos
    in the said suit. The City Civil Court allowed the suit thereby holdi111g
    that the respondents were entitled to continue in service up to the age
    of 60. Appeal filed before the High Court, was dismissed by a Division
G   Bench. Hence the present appeal.

         Dismissing the appeal, the Court

           HELD : l. The Leave Rules framed by the appellant-Society are
    the applicable terms of the contract of service in case of the respond-
H   en ts-teachers. As per the original terms and conditions of the contract
                                       500
        AHMEDABAD EDUCATION SOCY. v. G.B. SHAH (RAJENDRA BABU, J.]        50 I        ·.
    they were appointed up to a particular age; that is, up to the age of 60. A
    As a result, they could be considered as appointed for a definite period.
    If they were appointed on contractual terms for a definite period, then
    they coul~ continue in service in accordance with the terms of the
    original contract, which, by virtue of Rule 29 of the Leave Rules, allow
    them to continue in service till the age of 60. Further, Sub-rule (3) of B
    Rule 34 of the Amended Rules exempted those person who are 'appointed
    for a definite period' from its ambit. [505-C; 504-F-G; 505-D)

       Jayantilal Ratilal Thakkar v. State of Gujarat and Ors., (1976) 17
    GLR 461, referred.

         State ofJ & K v. Shiv Ram Sharma & Others, JT (1999) 2 SCC 483;
                                                                                 c
r
    B. Narayana Murthy v. State of A.P., (1971) 2 SCC 425 and Roshan Lal
    Tandon v. Union of India, (1968) 1 SCR 185, held inapplicable.

         CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7097-7098
    of 1998.                                                      D
         From the Judgment and Order dated 29.12.98 of the Gujarat High
    Court at Ahmedabad in F.A. Nos. 1871 and 2140 of 1985.

         Mahendra Anand, Raj iv Mehta and Rauf Rahim for the Appellant.          E
         Raju Ramachandran Mrs. S.H. Raichura, H.A. Raichura and Shailendra
    Singh for the Respondents.

         The Judgment of the Court was delivered by

          RAJENDRA BABU, J. The basic issue raised for consideration in F
    these appeals is the retirement age of the respondents, who were teachers
    with the Appellant Society. According to the appellant, the retirement age
    of teachers in their school is 5 8 in accordance with the Sub-Rule (I) of
    the Rule 34 in Schedule-F of the Bombay Primary Education (Gujarat
    Amendment) Rules, 1978. (Hereinafter, Amendment Rules). Respondents G
    - teachers claimed that they could continue in service till the age of 60
    as per the Rule 29 of the Leave Rules of the Appellant Society, which is
    applicable in their case. It is also their case that the applicability of Leave
    Rules is saved by virtue o( Sub-Rule (3) of the Rule 34 in Schedule-F of
    the Amendment Rules.          .
                                                                                 H
    502                 SUPREME COURT REPORTS (2003) SUPP. 6 S.C.R.

A            The relevant Rules are extracted hereunder :

             Sub-Rules 1 and 3 of Rule 34 in Schedule-F of the Amendment
             Rules:

             "34. Age of superannuation of Teacher: (I) An employee shall
B            retire at the age of 58 years. However, a review of the work will
             be undertaken at the age of 55 years for deciding whether he
             deserves to be continued beyond the age 55.

             (2).   *     *      *
c            (3). The rules shall not apply to employees who are already
             employed on a contract basis for a definite period. However, the
             management shall not make any appointments on contract which
             would defeat the provisions of these rules."

D            Rule 29 of the Leave Rules:

             "The age of retirement for servants of the society will ordinarily
             be 60 years but the Governing Body may require a Medical
             Certificate of fitness after the age of 55."

E        Facts as emerging from the Original Civil and the subsequent Appeal
    before the High Court leading to these appeals by special leave are as
    under:

          That one Mr. Shiv Prasa Valjibhai was appointed as a teacher in a
F   Primary School owned by the Appellant Society. He was informed by the
    Appellant that he would b~ retiring from service on completion of 58 years
    in 1983. Shiv Prasad Valjibhai filed the Civil Suit No. 2001 of 1983 in
    the City Civil Court at Ahmedabad, mainly seeking a declaration that his
    age of retirement is 60 and also prayed for other consequential relief. Some
    of the Respondents herein impleaded themselves as parties in the said Suit.
G   The Appellant/Defendant maintained the stand that the Respondents/
    Plaintiffs are to be retired at the age of 58 as they are following the Rules
    and Regulations applicable to the teachers of the Municipal School Board.

         The Civil Court relied upon Jayantilal Ratilal Thakkar v. State of
H   Gujarat and Others, (l 976) 17 GLR 461, wherein it was held that there
    AHMEDABAD EDUCATION SOCY. v. G.B. SHAH [RAJENDRA BABU, J.]        503

is no security of tenure and no statutory protection for employees in a A
primary school run by a private body. It was also held in that case that the
security of tenure of a primary school teacher is governed by master and
servant relationship of by contract between the parties. Based on this ruling
the Civil Court found that by virtue of Sub-Rule 3 of the Rule 34 of the
Amendment Rules, which says that "these rules shall not apply to B
employees who are already employed on a contract basis for a definite
 period" the Respondents/Plaintiffs are entitled to continue in service up to
the age of 60. Because once the Amended Rules become inapplicable the
Rule 29 of the original Leave Rules, which was a part of the terms and
condi~ions of the contract, will determine the tenure of teachers. Civil Court
pointed out that the Appellant/Defendant have not brought on record any C
copy of the relevant Municipal Board Rules that is said to have been
followed by them. It is also pointed out that in a reply to the notice for
the production of documents, the Appellant/Defendant stated that "as
 regards Municipal School Board Rules in force in 1957 and in 1960, we
 are not in possession of the same." Taking into account all these aspects D
 Civil Court rejected the contention that the Appellant/Defendant is follow-
 ing the Rule and Regulations applicable to the teachers of the Municipal
 School Board. Moreover, in anothei: reply to the interrogatories at Ex. 8
(before Trial Court) the Appellant!l;>efendant stated that "Leave Rules are
terms of the contract of service of such employees whose ~ervice condi-
tions are not governed by the Statute or statutory rules and they are framed E
 for persons whose terms and conditions of service are governed by the
 contract entered into by and between such employees and the Society".
 Thus concluded that the original Leave Rules determine the terms and
 conditions of the service of these Respond~nts. Another contention put
 forwarded by the Appellant/Defendant before the Civil Court is that Sub_- F
 Rule (3) of Rule 34 of the Amended Rules is applicable only to those who
are employed on a contract basis for a definite period. Pertaining to this
the Civil Court found that since the Respon4ent/Plaintiffs were appointed
 up to the age of 60; their appointme~t is for a definite period. It was also
 held that the rule making authority appeared to have decided not to disturb G
such advantageous and beneficial conditions of service that were operating
 in favour of the employees. With these reasoning prayers in the Plaint were
allowed.

    The Appellant challenged the Civil Court Order before a Division
Bench of the Gujarat High Court. The appellant contented before the High H
    504                SUPREME COURT REPORTS [2003] SUPP. 6 S.C.R.
A Couti that Amended Rules had the effec! of prevailing over any terms of ·
    contract. Second limb of the argument was there was no indication in the
    order of appointment that the age of superannuation would be 60 years.
    Regarding Leave Rules the stand was taken that the same was only for
    guidance for the management that they could retain an employee till the
B   age of 60 and also contended that the Leave Rules are applicable only to
    Class IV employees and not to teachers.

          Primarily, after making a detailed survey through various provisions
    of the Leave Rules, the High Court found that the same is applicable to
    all the employees of the society including teachers and constituted
C   conditions of service of the employees of the Appellant. Thereafter the
    High Court finds that when the employment is purely in the realm of
    contract and not governed by any statutory provisions, the terms and
    conditions of the contract will alone govern the field. Regarding the
    prevalence of Amended Rules over the contr~ctual terms, the High Court
D   finds that the same cannot be interpreted so as to take away the contractual
    rights. And the fixing of the superannuation age by the Amended Rules
    is not intended to reduce the tenure ofa permanent teacher.under the terms
    of the contract. For these reasons, it is concluded that even without
    reference to the Rule 34(3) of the Amended Rules the teachers have a right
    to continue till the age of 60. It went on to hold that in view of Section
E   14(1 )(b) of the Special Relief Act. The teachers were entitled to damages
    in the event of forced premature retirement. Consequently, the Appeal was
    rejected. ·

          This judgment is impugned before us.

F         The fundamental question for consideration in this case is the nature
    of the original appointment of the Respondents - teachers. If they were
    appointed on contractual terms for a definite period, then they could
    continue in service in accordance with the terms of the original contract,
    which, by virtue of Rule 29 of the Leave Rules allow them to continue In
G   service till the age of 60.

         It is not disputed that the respondents were appointed by Letters of
    Amendment similar to that of one produced as Ext. 50 before Civil Court.
    One condition in that Letter of Appointment is that the appointee will have
    to observe the general rules and regulations of the Society. Admittedly
H   Leave Rules are framed by the Society. It is also admitted by the Society
           AHMEDABAD EDUCATION SOCY. v. G.B. SHAH [RA.IENDRA BABU, J.] 505

    that the Leave Rules framed by the Society are terms of the contract of A
    service. The relevant portion of the Civil Court judgment is extracted:

              " .. .In their reply at Exh. 9, in reply to· point nos. 14 and 15 in
              the interrogatories at Exh. 8, the defendants have stated that the
              Leave Rules are terms of contact of service of such employees
              whose service conditions are not governed by the Statute or B
              statutory rules and they are framed for persons whose terms and
              conditions of service are governed by the contract entered into by
              and between such employees and the society ... "
                                                                (Emphais supplied)

          Since this is the accepted position, Leave Rules are the applicable C
    terms of service in case of the Respondents - teachers.As per the original
    terms and conditions of the contract they were appointed up to a particular
    age; that is, up to the age of 60. As a result, they could be considered as
    appointed for a definite period. Sub-rule (3) of Rule 34 of the Amended
    Rules exempted those persons who are 'appointed for definite period' from D
    its ambit. Since the Amended Rules exempted the Respondents, the
    authorities cited before us - State of J & K v. Shiv Ram Sharma & Others,
    JT (1999) 2 SC 483; B. N Narayana Murthy v. State ofA.P., [1971] 2 SCC
    425 and Roshan Lal Tandon v. Union of b;idia, [1968] I SCR 185, are of
    no assistance in the facts and circumstances of this case. Moreover, the E
    Appellant is a private registered Society. In any case, the tern1s of contract
    will determine the terms of service of the employee. In this context, it is
    unnecessary for us to examine the other issues advanced before us.

           Hence the decision arrived at by the High Court does not need any
     interference. This Court had granted an interim order of stay while issuing F

1    notice on 11.5.1999 and continued the same subject to the condition of
    payment of money in the event of the dismissal of these appeals. The
    respondents or the LRs were'· entitled to the difference in salary and
     emoluments, if any, had they·continued in service as held by the High
    .court. Let the appellant compute such amount and pay it to respondents
     within a period of three months from today.                                 G
           The appeals stand dismissed accordingly.

    M.P.                                                   Appeals dismissed.