Holding

Courts cannot order regularization of contractual or temporary employees merely on the basis of long service; such claims must be decided in accordance with the proper selection procedures and cannot rely on a theory of legitimate expectation.

Summary

The respondents, employed as contractual data entry operators and paid hourly, sought regularization of their posts on the ground of having rendered long service. The Central Administrative Tribunal directed the employer to consider their cases, but the employer challenged the order and the High Court dismissed the writ petition filed by the employer. On appeal, the Supreme Court examined whether contractual or temporary employees can claim regularization or permanent appointment merely because of the length of their service, invoking the principle of legitimate expectation and the constitutional scheme of public appointments. Relying on the earlier decision in Secretary, State of Karnataka v. Uma Devi, the Court held that such employees cannot invoke legitimate expectation and that regularization must follow proper selection procedures prescribed by law and, where applicable, the Public Service Commission. Consequently, the appeal was allowed and the matter was remitted to the High Court for fresh consideration in light of the Uma Devi judgment.

Issues considered

Whether contractual or temporary employees are entitled to regularization or permanent appointment on the basis of long service and legitimate expectation.
Whether the High Court erred in dismissing the writ petition challenging the Tribunal's direction to consider regularization.
Whether a mandamus can be issued to compel the State to regularize such employees.
Whether the Central Administrative Tribunal had jurisdiction to entertain the regularization claim under the Administrative Tribunals Act.

Legislation cited

Administrative Tribunals Act, 1985s. 19

Subjects

regularizationcontractual employmenttemporary appointmentlegitimate expectationpublic service commissionArticle 14mandamusservice law

Judgment

CHIEF COMMISSIONER OF INCOME TAX, BHOPAL AND ORS. A
v.
MIS. LEENA JAIN AND ORS.

NOVEMBER 20, 2006

[ARIJITPASAYAT ANDLOKESHWARSINGHPANTA,JJ.] B

Service Law:

Regularization-Claim of, by contractual employees on the ground of
having worked for considerable length of time-Tribunal directing employer C
to consider their case-Writ petition by employer dismissed-On appeal,
held, matter requires consideration in the light of decision in Uma Devi's
case-Remitted to High Court.

Respondents had been working as Data Entry Operator on contract basis D
and were paid on hourly basis. They claimed regularization on the ground
that they had been working since long period. Tribunal directed the appellant
for considering their case. Aggrieved appellant filed writ petition before High
Court, which was dismissed. Hence the present appeal.

Allowing the appeal and remitting the matter to High Court for fresh E
consideration in the light of decision in *Uma Devi's case, the Court.
HELD: While directing that appointments, temporary or casual be
regularized or made permanent, courts are swayed by the fact that the
concerned person has worked for some time and in some cases for a
considerable length of time. It is not as if the person who accepts an F
engagement either temporary or casual in nature, is not aware of the nature
of his employment. He accepts the employment with eyes open. It may be true
that he is not in a position to bargain - not at arms length - since he might
have been searching for some employment so as to eke out his livelihood and
accepts whatever he gets. But on that ground alone, it would not be appreciate
to Jettison the constitutional scheme of appointment and to take the view that G
a person who has temporarily or casually got employed should be directed to
be continued permanently. By doing so, it will be creating another mode of
public appointment which is not permissible. If the Court were to void a
contractual employment of this nature on the ground that the parties were

169 H
--
170 SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A not having equal bargaining power, that too would not enable the court to grant
any relief to that employee. A person who enters a temporary employment or
engages as a contractual or casual worker and whose engagement is not
based on a proper selection as recognized by the relevant rules or procedure,
is aware of the consequences of the appointment being temporary, casual or
B contractual in nature. Such a person cannot invoke the theory of legitimate
expectation for being confirmed in the post when an appointment to the post
could be made only by following a proper procedure for selection and in
consultation with Public Service Commission.
[171-G; 172-A-B; G-H; 173-A-B)
*Secretary, State of Karnataka and Ors. v. Uma Devi and Ors., [2006)
c 4 sec 1, relied on.
CIVIL APPELLATE JURISDICTION : Civil Appeal No.5074of2006.

From the Judgment and Order dated 16-7-2003 of the High Court of
Madhya Pradesh at Jabalpur in W.P. No.197411998.
D
Vikas Singh, A.S.G., Shiva Lakshmi, Amrita Narayan, Pritesh Kapoor and
B.V. Balaram Das for the appellants.

Amitesh Kumar and Lakshmi Raman Singh for the Respondents.

E The Judgment of the Court was delivered by

ARIJIT P ASAY AT, J. Leave granted.

Challenge in this appeal is to the order passed by a Division Bench of
the Madhya Pradesh High Court at Jabalpur in Writ Petition No. 1974of1998.
F Appellants had challenged the composite order dated 13. lL 1997 passed in
OA No. 691 of 1995 and O.A. No.89 of 1996 passed by the Central
. Administrative Tribunal, Jabalpur Bench, at Jabalpur (in short the 'CAT').
The respondents moved the CAT under Section 19 of the Administrative
Tribunals' Act, 1985 (in short the 'Act') seeking regularization of their services.

G Stand of the respondents before the CJ\..T was that they have been
performing their duties as Data Entry Operators on contract basis and were
being paid at a rate of Rs. I 0 per hour up to the maximum of Rs.50 per day.
Since they have been working since a long period they sought for regularization
placing reliance on the factum of long rendition of service.

H In response, present appellants contended that the respondents were
CHIEF COMMNR. OF INCOME TAX, BHOPAL 1·. LEENA JAIN [PASAYA T, J.] 171
not departmental employees and their grievances cannot be agitated before A
the CAT. Placing reliance on some other decisions by the CAT, the stand of
the present appellants was turned down and direction was given for
considering the cases of appointment on regular basis.

A writ petition was filed before the High Court, which was dismissed
by the impugned order. B
In support of the appeal learned counsel for the appellants submitted
that the decision of the High Court is contrary to law as laid down by the
Constitution Bench of this Court .in Secretary, State of Karnataka and Ors
v. Uma Devi and Ors. [2006] 4 SCC l. Learned counsel for the respondents
on the other hand submitted that since the CAT had relied on an earlier C
judgment, High Court rightly did not find any distinguishable feature, and the
appeal, therefore, deserves to be dismissed.

The question of regularization on the ground of long rendition of
service was the subject matter in Uma Devi's case (supra). The said issue has D
been elaborately dealt with in the judgment. It was inter alia held as follows:

"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 E
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. F
xxx xxx
45. While directing that appointments, temporary or casual, be
regularized or made permanent, courts are swayed by the fact that the
concerned person has worked for some time and in some cases for a G
considerable length of time. It is not as if the person who accepts an
engagement either temporary or casual in nature, is not aware of the
nature of his employment. He accepts the employment with eyes
open. It may be true that he is not in a position to bargain - not at
arms length - since he might have been searching for some H
172 SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A employment so as to eke out his livelihood and accepts whatever he
gets. But on that ground alone, it would not be appropriate to jettison
the Page 1946 constitutional scheme of appointment and to take the
view that a person who has temporarily or casually got employed
should be directed to be continued permanently. By doing so, it will
be creating another mode of public appointment which is not
B pennissible. If the court were to void a contractual employment of this
nature on the ground that the parties were not having equal bargaining
power, that too would not enable the court to grant any relief to that
employee. A total embargo on such casual or temporary employment
is not possible, given the exigencies of administration and if imposed,
c would only mean that some people who at least get employment
temporarily, contractually or casually, would not be getting even that
employment when securing of such employment brings at least some
succor to them. After all, innumerable citizens of our vast country are
in search of employment and one is not compelled to accept a casual
or temporary employment if one is not inclined to go in for such an
D employment. It is in that context that one has to proceed on the basis
that the employment was accepted fully knowing the nature of it and
the consequences flowing from it. In other words, even while accepting
the employment, the person concerned knows the nature of his
employment. It is not an appointment to a post in the real sense of
E the term. The claim acquired by him in the post in which he is
temporarily employed or the interest in that post cannot be considered
to be of such a magnitude as to enable the giving up of the procedure
established, for making regular appointments to available posts in the
services of the State. The argument that since one has been working
for some time in the post, it will not be just to discontinue him, even
F though he was aware of the nature of the employment when he first
took it up, is not one that would enable the jettisoning of the procedure
established by law for public employment and would have to fail when
tested on the touchstone of constitutionality and equality of
opportunity enshrined in Article 14 of the Constitution.
G 47. When a person enters a temporary employment or gets engagement
as a contractual or casual worker and the engagement is not based
on a proper selection as recognized by the relevant rules or procedure,
he is aware of the consequences of the appointment being temporary,
casual or contractual in nature. Such a person cannot invoke the
H
CHIEF COMMNR. OF INCOME TAX, BHOPAL v. LEENA JAIN [PASAYA T,J.] 173

theory of legitimate expectation for being confirmed in the post when A
an appointment to the post could be made only by following a proper
procedure for selection and in concerned cases, in consultation with
the Public Service Commission. Therefore, the theory of legitimate
expectation cannot be successfully advanced by temporary, contractual
or casual employees. It cannot also be held that the State has held B
out any promise while engaging these persons either to continue them
where they are or to make them permanent. The State cannot
constitutionally make such a promise. It is also obvious that the
theory cannot be invoked to seek a positive relief of being made
permanent in the post.

52. Normally, what is sought for by such temporary employees when
c
·they approach the court, is the issue of a writ of mandamus directing
the employer, the State or its instrumentalities, to absorb them in
permanent service or to allow them to continue. In this context, the
question arises whether a mandamus could be issued in favour of
such persons. At this juncture, it will be proper to refer to the decision D
of the Constitution Bench of this Court in Dr. Rai Shivendra Bahadur
v. The Governing Body of the Nalanda College (1962] Supp: 2 SCR
144. That case arose out of a refusal to promote the writ petitioner
therein as the Principal of a college. This Court held that in order that
a mandamus may issue to compel the authorities to do something, it E
must be shown that the statute imposes a legal duty on the authority
and the aggrieved party had a legal right under the statute or rule to
enforce ~t. This Classical position continues and a mandamus could
not be issued in favour of the employees directing the Government
to make them permanent since the employees cannot show that they
have an enforceable legal right to be permanently absorbed or that the F
State has a legal duty to make them permanent."

In view of what has been stated in Uma Devi's case (supra), we deem
it proper to remit the matter to the High Court to consider the case afresh in
the light of the said decision.
G
The appeal is allowed to the aforesaid extent with no orders as to costs.

D.G. Appeal allowed.

H
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