Supreme Court of India
NIHAL SINGH & OTHERSversusSTATE OF PUNJAB & OTHERS
- Citation
- 2013 INSC 520
- Decided
- 7 August 2013
- Disposal
- Appeal(s) allowed
- Bench
- H L GOKHALE
Holding
Appointments of Special Police Officers under Section 17 of the Police Act create a master‑servant relationship with the State, obligating the State to regularise them by creating necessary posts despite the absence of pre‑existing sanctioned positions.
Summary
During the 1980s, amid terrorism in Punjab, the State recruited ex‑servicemen as Special Police Officers (SPOs) under Section 17 of the Police Act, 1861 to guard public‑sector banks, with their wages paid by the banks. The SPOs served for decades and sought regularisation as permanent police personnel, but the Senior Superintendent of Police rejected their claim, stating that they were bank employees. The High Court dismissed their petitions, relying on an earlier decision that no regular cadre existed for such posts. The Supreme Court held that the appointments were made by the State, that disciplinary control rested with the State, and that the source of wage payment does not determine the employer‑employee relationship, thereby establishing a master‑servant relationship with the State. It further ruled that the State must create the necessary posts to regularise the SPOs, as failure to do so constitutes arbitrary inaction, and directed the State to regularise the appellants within three months, granting them all police benefits and costs.
Issues considered
- Whether SPOs appointed under Section 17 of the Police Act, 1861 are employees of the State for purposes of regularisation.
- Whether the fact that banks pay the wages of SPOs determines the employer‑employee relationship.
- Whether a court can compel the State to create new sanctioned posts to regularise SPOs in the absence of an existing cadre.
- Whether the recruitment process under Section 17 complies with Articles 14 and 16 of the Constitution.
- Whether the State's failure to create posts after decades of service amounts to arbitrary action violating Article 14.
Legislation cited
- Police Act, 1861s. 17, s. 18
Subjects
service lawregularisationspecial police officermaster‑servant relationshipconstitutional lawArticle 14Article 16Police Actpublic sector banksterrorismPunjab
Judgment
[2013] 11 S.C.R. 1
NIHAL SINGH & OTHERS A
v.
STATE OF PUNJAB & OTHERS
(Civil Appeal No. 1059 of 2005)
AUGUST 7, 2013
B
[H.L. GOKHALE AND J. CHELAMESWAR, JJ.]
. Service Law - Regularisation - Appointment of
appellants ex-servicemen as Special Police Officers (SPOs)
in terms of the procedure uls. 17 of the Act - Claim of C
appellants for regularisation - Rejected - Legality - Held:
Recruitment of appellants was made in the background of
terrorism prevailing in the State of Punjab at that time -
Decision to resort to procedure uls. 17 was taken at the highest
level of the State by conscious choice to provide necessary c:5
security to the pµblic sector banks - Process of selection
adopted in identifying the appellants was not unreasonable
or arbitrary - From the mere fact that payment of wages came
from the bank at whose disposal the services of each of the
.appellants was kept did not render the appellants employees E
of those banks - Appointment of appellants was made by the
State and disciplinary control vested with the State, the two
factors which conclusively establish relationship of master
and servant between the State and the appellants - No
justification for the State to take defence, after permitting
utilisation of the services of appellants for decades, that there F
were no sanctioned posts to absorb the appellants -
Sanctioned posts do not fall from heaven - State has to
create them by a conscious choice on the basis of rational
assessment of the need - Failure of the executive
government to apply its mind and take a decision to create G
posts or stop extracting work from persons such as the
appellants for decades together itself would be arbitrary
action (inaction) on the part of the State - On facts, creation
1 H
2 SUPREME COURT REPORTS [2013) 11 S.C.R.
A of new posts would not create any additional financial burden
to the State as the various banks at whose disposal the
services of the appellants was made available had agreed to
bear the burden - If absorbing the appellants into the services
of the State and providing benefits at par with the police
B officers of similar rank employed by the State results in further
financial commitment it is always open for the State to
demand the banks to meet such additional burden - State
Government directed to regularise the services of the
appellants by creating necessary posts - Police Act, 1861 -
c ss.17 and 18.
Service Law - New posts - Creation of - Assessment of
ne~~ - Examination by Constitutional Court not baffed.
"''·
Service Law - New posts - Creation of - Considerations
D for - Discussed.
There was a large scale disturbance in the State of
Punjab in 1980s and the State was not in a position to
handle the prevailing law and order situation with the
available police personnel. Therefore, the State of Punjab
E resorted to recruitment under section 17 of the Police Act,
1861 which enabled appointment of Special Police
Officers (SPOs). The appellants, who were ex-servicemen,
were recruited as SPOs.
F Subsequently, the appellants approached the High
Court praying that their services be regularized. The writ
petition was dismissed directing consideration of the
cases of the appellants in accordance with the law.
Pursuant to the directions, the Senior Superintendent of
G Police (SSP) purported to consider the cases of the
appellants and passed order rejecting their claim on the
ground that the appellants were working as guards with
various banks and their wages were being paid by such
banks and, therefore, their claim for regularization, if any,
H
NIHAL SINGH v. STATE OF PUNJAB 3
lay only to the concerned bank but not to the police A
departrnent.
Challenging the said order, the appellants once
again approached the High Court in a Writ Petition which
was dismissed on the basis of an earlier judgment of the
8
High Court in Letter Patent Appeal No.209 of 1992 filed
by persons similarly situated as the appellants, wherein
the High Court had rejected the claim of the SPOs for
regularization. Hence the present appeals.
Allowing the appeals, the Court c
HELD:1.1. The appointment of all the appellants was
made by the SSP in exercise of the statutory power under
section 17 of the Police Act, 1861. The powers, privileges
and obligations of the SPOs appointed in exercise of the 0
powers under section 17 of the Act are specified in
section 18. It is obvious both from the said section and
also the appointment orders, the appellants are appointed
by the State in exercise of the statutory power under
section 17 of the Act. The appellants are amenable to the E
disciplinary control of the State as in the case of any other
regular police officers. The only distinction is that they are
to be paid daily wages. [Paras 16, 17] [14-B-C, E-F]
1.2. From the mere fact that the payment of wages
came from the bank at whose disposal the services of F
each of the appellants was kept did not render the
appellants employees of those banks. The appointment
was made by the State and the disciplinary control vested
with the State, the two factors which conclusively
establish that the relationship of master and servant G
exists between the State and the appellants. Under the
law of contracts in this country the consideration for a
contract need not always necessarily flow from the
parties to a contract. The decision of the SSP to reject the
claim of the appellants only on the basis that the payment H
4 SUPREME COURT REPORTS [2013) 11 S.C.R.
A of wages to the appellants was being made by the
concerned banks rendering them disentitled to seek
regularizati(>n of their services from the State, is clearly
untenable. [Para 18) [14-G-H; 15-A-C]
2.1. In the judgment of the division bench of the High
8
Court of Punjab & Haryana in LPA No.209 of 1992 where
the claims for regularization of the similarly situated
persons were rejected on the ground that no regular
cadre or sanctioned posts are available for regularization
C of their services, the High Court may be factually right in
recording that there is no regularly constituted cadre and
sanctioned posts against which recruitments of persons
like the appellants were made. However, that does not
conclusively decide the issue on hand. The creation of a
cadre or sanctioning of posts for a cadre is a matter
D exclusively within the authority of the State. That the
State did not choose to create a cadre but chose to make
appointments of persons creating contractual
relationship only demonstrates the arbitrary nature of the
exercise of ithe power available under section 17 of the
E Act. [Para 19] [15-C-F]
2.2. No doubt that the powers under section 17 are
meant for 1'1'1eeting the exigencies contemplated under it,
such as, riot or disturbance which are normally expected
F to be of a short duration. Therefore, the State might not
have initially thought of creating either a cadre or
permanent posts. But there is .no justification for the State
to take a defence after permitting the utilisation of the
services of large number of people like the appellants for
decades. thclt there are no sanctioned posts to absorb
G the appellan:ts. Sanctioned pos.ts do not fall from heaven.
State has tC! create them by a conscious choice on the
basis of some rational assessment of the need. [Paras 20,
21] [15-G-H;. 16-A-B]
H 3.1. Th~ initial appointment of the appellants was
NIHAL SINGH v. STATE OF PUNJAB 5
made in accordance with the statutory procedure A
contemplated under the Act. The decision to resort to
such a procedure was taken at the highest level of the
State by conscious choice. Such a decision was taken
as there was a need to provide necessary security to the
public sector banks. As the State was not in a position B
to provide requisite police guards to the banks, it was
decided by the State to resort to section 17 of the Act. As
the employment of such additional force would create a
further financial burden on the State, various public
sector banks undertook to take over the financial burden C
arising out of such employment. [Paras 25, 26] [18-C-D,
E-F]
3.2. Pursuant to the. requisition by the police
department, options were called upon from ex-
servicemen who were willing to be enrolled as Special D.
Police Officer (SPOs) under section 17 of the Police Act,
1861. Such a procedure making recruitments through the
employment exchanges is consistent with the
requirement of Articles 14 and 16 of the Constitution. It is
not a case where persons like the appellants Were E
arbitrarily chosen to the exclusion of other eligible
candidates. It required all able bodied persons to be,
considered by the SSP who was charged with the
responsibility of selecting suitable candidates. [Paras 27,
29] [20-B-E] F
3.3. The recruitment of the appellants and other
similarly situated persons was made in the background
of terrorism prevailing in the State of Punjab at that time.
Viewed in the context of the situation prevailing at that G
point of time in the State of Punjab, such a process of
selection cannot be said to be irrational. The need was
to obtain the services of persons who had some
experience and training in handling an extraordinary
situation of dealing with armed miscreants. Preference
H
6 SUPREME COURT REPORTS [2013] 11 S.C.R.
A was given to persons who are in possession of licensed
weapons. The procedure which is followed during the
normal times of making recruitment by inviting
applications and scrutinising the same to identify the
suitable candidates would itself take considerable time.
B Even after such a selection, the selected candidates are
required to be provided with necessary arms and also
be trained in the use of such arms. All this process is
certainly time consuming. The requirement of the State
was to take swift action in an extra-ordinary situation.
c Therefore, the process of selection adopted in identifying
the appellants cannot be said to be unreasonable or
arbitrary in the sense that it was devised to eliminate
other eligible candidates. [Paras 30, 31, 32] [21-A-F]
Union of fl:ldia and Ors. v. N. Hargopal and Ors. (1987)
D 3 SCC 308: 1987 (2) SCR 911 - relied Qn.
4.1. No doubt the assessment of the need to employ
a certain number of people for discharging a particular
responsibility of the State under the Constitution is
E always with the executive Government of the day subject
to the overall control of the Legislature. That does not
mean that an examination by a Constitutional Court
regarding the accuracy of the assessment of the need
is barred. [Para 34] [22-C-D]
F 4.2. The existence of the need for creation of the
posts is a relevant factor reference to which the executive
government is required to take rational decision based
on relevant consideration. When the facts such as the
ones obtaining in the instant case demonstrate that there
G is need for the creation of posts, the failure of the
executive government to apply its mind and take a
decision to create posts or stop extracting work from
persons such as the appellants for decades together
itself would be arbitrary action (inaction) on the part of
H the State. [Pa~ra 35] [23-C-D]
NIHAL SINGH v. STATE OF PUNJAB 7
4.3. The other factor which the State is required to A
keep in mind while creating or abolishing posts is the
financial implications involved in such a decision. The
creation of posts necessarily means additional financial
burden on the exchequer of the State. Depending upon
the priorities of the State, the allocation of the finances B
is no doubt exclusively within the domain of the
Legislature. However in the instant case creation of new
posts would not create any additional financial burden to
the State as the various banks at whose disposal the
services of each of the appellants is made available have c
agreed to bear the burden. If absorbing the appellants into
the services of the State and providing benefits at par with
the police officers of similar rank employed by the State
results in further financial commitment it is always open
for the State to demand the banks to meet such additional
0
burden. Apparently no such demand has ever been made
by the State. The result is - the various banks which avail
the services of these appellants enjoy the supply of
cheap labour over a period of decades. These banks are
pabtic sector banks. Neither the Government of Punjab
rror these public sector banks can continue such a E
pl(actice consistent_ with their obligation to function in
a_ccordance with the Constitution. [Para 36] [23-E-F; 24-
A-C]
S. S. Dhanoa v. Union of India (1991) 3 scc._567: 1991 F
(3) SCR 159 - relied on.
·-
Secretary, State of Kamataka and Ors v. Umadevi (3) and
Ors (2006) 4 SCC 1: 2006 (3) SCR 953 - referred to.
5. The appellants are entitled to be absorbed in the G
services of the State. The State of Punjab is directed to
· regularise the services of the appellants by creating
necessary posts. Upon such regularisation, the
appellants would be entitled to all the benefits of services
attached to the post which are similar in nature already H·
8 SUPREME COURT REPORTS [2013] 11 S.C.R.
A in the cadre of the police services of the State. [Para 37
and 38] [24-D-F]
Case Law Reference:
2006 (3) SCR 953 referred to Para 15
B
1987 (2) SCR 911 relied on Para 28
1991 (3) SCR 159 relied on Para 34
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
C 1059 of 2005.
From the Judgment & Order dated 21.08.2006 of the High
Court of Punjab & Haryana at Chandigarh in Civil Writ Petition
No. 1024 of 2005.
WITH
D
C.A. No. 6315 of 2013
R.K. Kapoor, Shivani Mahipal, Sheweta Kapoor, Rajat
Kapoor, Prikshit Mahipal, Anis Ahmed Khan for the Appellants.
E Kuldip Singh, Mohit Mudgal, Jagjit Singh Chhabra, Ajay
Pal for the Respondents.
The Judgment of the Court was delivered by
CHELAMESWAR, J. 1. Leave granted in SLP (Civil)
F No.12448 of 2009.
2. Since both the appeals raise a common question of law,
the same are being disposed of by this common judgment. For
the sake of convenience, we shall refer to the facts in Civil
Appeal No.1059 of 2005.
G 3. This appeal arises out of a judgment in CWP No. 13915
of 2002 of the High Court of Punjab and Haryana dated 23rd
January, 2003. 20 unsuccessful petitioners in the above writ-
petition are the appellants herein. The High Court dismissed
the writ petition following an earlier judgment of a Division
H Bench in LPA 209 of 1992 dated 6th September, 1993, which
NIHAL SINGH v. STATE OF PUNJAB 9
[J. CHELAMESWAR, J.]
in turn arose out of Civil Writ Petition No. 5280 of 1988. The A
facts leading to all these writ petitions as could be culled out
from the material on record are as follows:-
4. There was a large scale disturbance in the State of
Punjab in 1980s. State was not in a position to handle the
8
prevailing law and order situation with the available police
personnel. Therefore, the State of Punjab resorted to
recruitment. under section 17 1 of the Police Act, 1861
(hereinafter referred to as 'the Act') which enabled the State
(police officers not below the rank of Inspector) to appoint
Special Police Officers. C
5. The factual background in which persons such as the
appellants herein came to be appointed is recorded in the
judgment in LPA No. 209 of 1992 as follows:-
D
"I was at the meeting held on March 24, 1984 between the
Advisor to the Governor of Punjab and Senior officers of
the banks in the public Sector Operating in Punjab that,
after reviewing the security arrangements for banks in
Punjab, it was decided that SPOs be appointed for the
said purpose in terms of section 17 of the Police Act, 1861 E
(hereinafter referred to as the Act). This step was taken
as it was felt that it would not be possible for the State
Govt. to provide the requisite police guards to banks and
that, thereafter, this additional force be raised, in order to
F
1. Section 17, Police Act, 1861-When it shall appear that any unlawful
assembly, or riot or disturbance of the peace has taken place, or may be
reasonably apprehended, and that police force ordinarly employed for
preserving the peace is not sufficient for its preservation and for the
protection of the inhabitants and the security of property in the place where
such unlawful assembly or riot or disturbances of the peace has ocurred, G
or is apprehended, it shall be lawful for any police officer not blew the rank
of. Inspector to apply to the nearest Magistrat@ to appoint so many of the
residents of the neighourbhood as such police officers may require to act
as SPOs for such time and within such limits as he shall deem necessary
and the Magistrate to whom such application is made shall, unless he
sees cause to the contrary, comply with the application.
H
10 SUPREME COURT REPORTS [2013] 11 S.C.R.
A do so, the banks undertook to take over the financial
burden of the SPOs to be appointed, but it was clearly
understood that as per the provisions of the Act. such
Police Officers would be under the discipline and control
of the Senior Superintendent of Police of the district
B concerned. As regards their remuneration it was decided
that SPOs would be paid an honorarium of Rs 15/- per
day. This WC!S, however, later enhanced to Rs. 30/- per day.
Relevant in the context of the SPOs to be appointed, was
the further decision"
c 6. The appellants herein assert that all the appellants are
ex-servicemen and registered with the employment exchange.
They were recru'ited as Special Police Officers 2 •
7. The appointment order of the first appellant reads as
D follows:
"Nihal Singh s/o Shri Nidhan Singh r/o Kallah PS Sadar
7-7 is hereby appointed as a Special Police Officer under
section 17 of the Police Act. 1961, in the rank of SPO and
is assigned special constabulary number 277. He shall be
E
entitled to all privileges under Police Act 1861 and shall
be under the administrative control of the undersigned in
the matter of discipline etc.
He shall be paid Rs.35/- per day by the concernea "ank
F of posting a:s honorarium from the date he actually takes
over charge of his duty."
8. In the background of such appointments, various
persons who were appointed, including the appellants herein,
G 2. Ground IV of SLP ..... lt was the Police Department which sent the intimation
to the employment exchange and thereafter all the ex-serviceman who
enrolled as Special Police Officer (SPOs) under Section 17 of the Police
Act, 1861. Thoi;e persons who were having armed licence were enrolled
as SPOs and this enrolment was made by the Superintendent of Police,
Amritsar. Similar orders were passed by the Superintendent of Polee
H regarding all th~ petitioners between 1986 to 1994.
NIHAL SINGH v. STATE OF PUNJAB 11
[J. CHELAMESWAR, J.]
approached the High Court of Punjab & Haryana from time to A
time seeking appropriate directions for regularisation of their
services. It appears that the petitioners herein also had
approached the High Court earlier in CWP No.19390 of 2001
praying that their services be regularized in the light of
notification No.11/34/2000-4PP-lll/1301 dated 23.1.2001. The B
said writ petition was dismissed by order dated 12.12.2001
directing consideration of the cases of the petitioners therein
(appellants herein) in accordance with the law and pass a
speaking order.
9. Pursuant to the said directions, the Senior C
Superintendent of Police, Amritsar (hereinafter referred to as
'the SSP') purported to consider the cases of the appellants
herein and passed an order dated 23.4.2002 rejecting the
claim of the appellants. The relevant portion of the order reads
as follows: D
"In compliance with the aforesaid order dated 12.12.2001
passed by the Hon'ble High Court of Punjab and Haryana,
the joint legal notice dated 3.4.2001 (Annexure P-4)
submitted by the petitioners, has been examined by the E
undersigned and it has been found that the petitioner is
not entitled to claim the relief of regularization of his
services as he was appointed as SPOs (Bank Guards) on
daily wages basis @ Rs.30/- per day by the SSP/Amritsar
vide No.14477-80/B dated 27.4.87 S.P.O. (Bank Guard), F
on the request of the Bank Authorities which were
increased later on from time to time as per Govt.
instructions. They were appointed as SPO (Bank Guards)
in order to provide them power, privileges and protection
of ordinary police official as provided under section 18 of G
the Police Act 1861 due to terrorism in the State at that
time. The petitioners are still working as guards with the
Gramin Banks and daily wages is being given by the Bank
Authorities. No seniority of the S.P.O. (Bank Guard) has
been maintained in Amritsar District. SPO (Bank Guard)
H
12 SUPREME COURT REPORTS [2013) 11 S.C.R.
A is still working with the Gramin banks in Amritsar district
and he can lay his claim, if any, to the bank authorities
instead of the Police Department.
Keeping io view the above legal notice dated 3.4.2001
(annexure P.4) has been considered. The notification
B
No.11/34/2000-4PP-l1 l/1301 dated 23.1.2001 is not
applicable in the case bank guard as their daily wages are
being paid by the bank. As such, the claim of the petitioner
(Bank GL.lards) SPO Ajit Singh No.247/ASR is not
maintainable against the State of Punjab or this Office.
c Legal notice Annexure P-4 is devoid of any legal force and
is being r~jected. The petitioner be informed personally."
10. Challetiging the said order, the appellants herein once
again approached the High Court of Punjab & Haryana in Civil
D Writ Petition N,o.13915 of 2002 which came to be dismissed
by the judgment under appeal.
11. As alr!3ady noticed, the appellants' writ petition was
dismissed on the basis of an earlier judgment of the High Court
E of Punjab & H$ryana passed in Letter Patent Appeal No.209
of 1992. In the said Letter Patent Appeal filed by the persons
similarly situated as the appellants herein, the High Court of
Punjab & Hary~na recorded a categoric finding that there is a
relationship of r:naster and servant between the State of Punjab
and the SPOs:
F
"Such beirjg the situation, there can be no escape from the
conclusion that the relationship of master and serva!lt of
SPOs is \\lith the State govt. and not with the banks."
G However, lthe claim of the SPOs for regularization was
refused holdinS:
"As regard~ regularization of the services of Special Police
Officers, by the very nature and purpose of their
appointment as such, no occasion arises to warrant such
H
NIHAL SINGH v. STATE OF PUNJAB 13
(J. CHELAMESWAR, J.]
regularization. As mentioned earlier, there is no regular A
cadre for such posts, nor have any particular number of
posts been created for this purpose. These factors clearly
mitigate against such services being regularized."
12. Relying on the said conclusion, the writ petition of the B
appellants herein also came to be dismissed. Hence the
present appeal.
13. We are required to examine the correctness of the
decision dated 23.4.2002 of the SSP as approved by the
judgment under appeal. The reason assigned by the SSP for C
rejecting the claim of the appellants (the relevant portion of
which order is already extracted above) is that the appellants
are working as guards with various banks and their wages are
being paid by such banks and, therefore, their claim for
regularization, if any, lay only to the concerned bank but not to D
the police department.
14. Learned counsel for the appellants Shri R.K. Kapoor
submitted that the conclusion of the SSP that appellants cannot
have any claim against the State of Punjab to seek
regularization of their services is clearly wrong in view of the E
fact that the master and servant relationship exists between the
appellants and the State of Punjab.. Coming to the conclusion
of the High Court that in the absence of regularly constituted
cadre or sanctioned posts, regularization of the services of the
appellants cannot be guaranteed, Shri Kapoor argued that the F
authority to create posts vests exclusively with the State. The
State cannot extract the work from the persons like the
appellants for decades and turn back to tell the court that it
cannot regularize the services of such persons in view of the
fact that these appointments were not made against any G
sanctioned posts.
15. On the other hand, Shri Kuldip Singh, learned counsel
appearing for the State submitted that in the light of the
Constitution Bench decision of this Court in Secretary, State H
14 SUPR~ME COURT REPORTS [2013] 11 S.C.R
A of Karnataka and Ors v. Umadevi (3) and Ors (2006) 4 SCC
1, in absence of a sanctioned post the relief such as prayed
by the appellants cannot be given.
16. As can be seen from the order of appointment of the
8 1st appellant - which we take to be representative of the orders
of appointment of all the appellants (a fact which is not disputed
by the respondent), the appointment was made by the SSP in
exercise of the statutory power under section 17 of the Act. It
is categorically mentioned in the said appointment order that
C the appellants <*re entitled to all the privileges under the Act.
The powers, privileges and obligations of the SPOs appointed
in exercise of the powers under section 17 of the Act are
specified in section 18 which reads as follows:
"Every special police officers so appointed shall have
D same powers, privileges and protection, and shall be liable
to perform the same duties and shall be amenable to the
same penalities and be subordinate to the same
authorities, as the ordinary officers of police."
E 17. It is obvious both from the said section and also the
appointment orders, the appellants are appointed by the State
in exercise of the statutory power under section 17 of the Act.
The appellants ~re amenable to the disciplinary control of the
State as in the case of any other regular police officers. The
F only distinction is that they are to be paid daily wages of Rs.35
(which. came to be revised from time to time). Further, such
payment was to be made by the bank to whom the services of
each one of the appellants is made available.
18. From the mere fact that the payment of wages came
G from the bank at whose disposal the services of each of the
appellants was kept did not render the appellants employees
of those banks. The appointment is made by the State. The
disciplinary control vests with the State. The two factors which
conclusively establish that the relationship of master and
H servant exists between the State and the appellants. A fact
NIHAL SINGH v. STATE OF PUNJAB 15
[J. CHELAMESWAR, J.]
which is clearly recognized by the division bench of the High A
Court in LPA No.209of1992. It may be worthwhile mentioning
here that under the law of contracts in this country the
consideration for a contract need not always necessarily flow
from the parties to a contract. The decision of the SSP to reject
the claim of the appellants only on the basis that the payment B
of wages to the appellants herein was being made by the
concerned banks rendering them disentitled to seek
regularization of their services from the State is clearly
untenable.
19. Coming to the judgment of the division bench of the C
High Court of Punjab & Haryana in LPA No.209of1992 where
the claims for regularization of the similarly situated persons
were rejected on the ground that no regular cadre or sanctioned
posts are available for regularization of their services, the High
Court may be factually right in recording that there is no reguiarly D
constituted cadre and sanctioned posts against which
recruitments of persons like the appellants herein were made.
However, that does not conclusively decide the issue on hand.
The creation of a cadre or sanctioning of posts for a cadre is
a matter exclusively within the authority of the State. That the E
State did not choose to create a cadre but chose to make
· appointments of persons creating contractual relationship oniy
demonstrates the arbitrary nature of the exercise of the power
available under section 17 of the Act. The appointments made
have never been terminated thereby enabling various banks to F
utilize the services of employees of the State for a long period
or. nominal wages and without making available any other
service benefits which are available to the other employees of
. the State, who are discharging functions similar to the functions
that are being discharged by the appellants. G
20. No doubt that the powers under section 17 are meant
for meeting the exigencies contemplated under it, such as, riot
or disturbance which are normally expected to be of a short
duration. Therefore, the State might not have initially thought of
creating either a cadre or permanent posts. H
16 SUPREME COURT REPORTS (2013] 11 S.C.R.
A 21. But we do not see any justification for the State to take
a defence that after permitting the utilisation of the services of
large number of people like the appellants for decades to say
that there are no sanctioned posts to absorb the appellants.
Sanctioned posts do not fall from heaven. State has to create
B them by a conscious choice on the basis of some rational
assessment of the need.
22. The question is whether this court can compel the State
of Punjab to create posts and absorb the appellants into the
services of the State on a permanent basis consistent with the
C Constitution Bench decision of this court in Umadevi's case.
To answer this question, the ratio decidendi of the Umadevi's
case is required to be examined. In that case, this Court was
considering the 1legality of the action of the State in resorting
to irregular appointments without reference to the duty to comply
D with the proper appointment procedure contemplated by the
Constitution.
"4 .... The Union, the States, their departments and
instrumentalities have resorted to irregular appointments,
E especially in the lower rungs of the service, without
reference to the duty to ensure a proper appointment
procedure through the Public Service Commissions or
otherwise as per the rules adopted and to permit these
irregular appointees or those appointed on contract or on
daily wages, to continue year after year, thus, keeping out
F
those wlio are qualified to apply for the post concerned
and depriving them of an opportunity to compete for the
post. It has also led to persons who get employed, without
the following of a regular procedure or even through the
backdoor or on daily wages, approaching the courts,
G seeking di~ections to make them permanent in their posts
and to prevent regular recruitment to the posts concerned. ·
The courts have not always kept the legal aspects in mind
and have qccasionally even stayed the regular process of
employment being set in motion and in some cases, even
H
NIHAL SINGH v. STATE OF PUNJAB 17
[J. CHELAMESWAR, J.]
directed that these illegal, irregular or improper entrants A
be absorbed into service. A class of employment which
can only be called "litigious employment", has risen like a
phoenix seriously impairing the constitutional scheme.
Such orders are passed apparently in exercise of the wide
powers under Article 226 of the Constitution. Whether the B
wide powers under Article 226 of the Constitution are
intended to be used for a purpose certain to defeat the
concept of social justice and equal opportunity for all,
subject to affirmative action in the matter of public
employment as recognised by our Constitution, has to be c
seriously pondered over."
(emphasis supplied)
23. It can be seen from the above that the entire issue
pivoted around the fact that the State initially made D
appointments without following any rational procedure
envisaged under the Scheme of the Constitution in the matters
of public appointments. This court while recognising the
authority of the State to make temporary appointments
engaging workers on daily wages declared that the E
regularisation of the employment of such persons which was
made without following the procedure conforming to the
requirement of the Scheme of the Constitution in the matter of
public appointments cannot become an alternate mode of
recruitment to public appointment. It was further declared that F
the jurisdiction of the Constitutional Courts under Article 226
or Article 32 cannot be exercised to compel the State or to
enable the State to perpetuate an illegality. This court held that
compelling the State to absorb persons who were employed
by the State as casual workers or daily-wage workers for a long G
period on the ground that such a practice would be an arbitrary
practice and violative of Article 14 and would itself offend
another aspect of Article 14 i.e. the State chose initially to
appoint such persons without any rational procedure
recognized by law thereby depriving vast number of other H
18 SUPREME COURT REPORTS [2013) 11 S.C.R.
A eligible candidates who were similarly situated to compete for
such employment.
24. Even going by the principles laid down in Umadevi's
case, we are of the opinion that the State of Punjab cannot be
B heard to say that the appellants are not entitled to be absorbed
into the services of the State on permanent basis as their
appointments were purely temporary and not against any
sanctioned posts created by the State.
25. In our opinion, the initial appointment of the appellants
C can never be categorized as an irregular appointment. The
initial appointment of the appellants is made in accordance with
the statutory procedure contemplated under the Act. The
decision to resort to such a procedure was taken at the highest
level of the State by conscious choice as already noticed by
D us. The High Court in its decision in LPA No.209 of 1992
recorded that the decision to resort to the procedure under
section 17 of the Act was taken in a meeting dated 24.3.1984
between the Advisor to the Government of Punjab and senior
officers of the various Banks in the public sector. Such a
E decision was taken as there was a need to provide necessary
security to the public sector banks. As the State was not in a
position to provide requisite police guards to the banks, it was
decided by the State to resort to section 17 of the Act. As the
employment of such additional force would create a further
F financial burden on the State, various public sector banks
undertook to take over the financial burden arising out of such
employment. In this regard, the written statement filed before
the High Court in the instant case by respondent nos.1 to 3
through the Assistant Inspector General of Police {Welfare &
G Litigation) is necessary to be noticed. It is stated in the said
affidavit:
"2. That in meeting of higher officers held on 27.3.1984 in
Governor House Chandigarh with Shri Surinder Nath, IPS,
Advisor to Governor of Punjab, in which following decisions
H were taken:-
NIHAL SINGH v. STATE OF PUNJAB 19
[J. CHELAMESWAR, J.]
(i) That it will not be possible to provide police guard A
to banks unless the Banks were willing to pay for
the same and additional force could be arranged
on that basis, it was decided that police guards
should be requisitioned by the Banks for their
biggest branches located at the Distt. and Sub B
Divisional towns. They should place the requisition
with the Distt. SSPs endorsing a copy of IG CID. In
the requisition, they should clearly state that the
costs of guard would be met by them. It will then be
for the police department to get additional force c
sanctioned. This task should be done on a top
priority. In the meantime depending upon the
urgency of the need of any particular branch, police
Deptt. may provide from police strength for its
protection.
D
(ii) For all other branches guards will be provided by
Distt. SSP after selecting suitable ex-servicemen
or other able bodied persons who will be appointed
as Special Police Officer in terms of Section 17 of
the Police Act. Preference may be given to persons E
who may already be in possession of licence
weapons. All persons appointed as SPO for this
purpose will be given a brief training for about 7
days in the Police Lines in the handling of weapons
taking suitable position for protection of branches. F
These SPOs will work under the discipline and
control and as per Police Act, they will have the
same powers, privileges and protection and shall
be amenable to same penalty as an ordinary police
personnel." G
26. It can be seen from the above that a selection process
was designed under which the District Senior Superintendent
of Police is required to choose suitable ex-servicemen or
other able bodied persons for being appointed as Special
H
20 SUPREME COURT REPORTS [2013] 11 S.C.R.
A Police Officers in terms of section 17 of the Act. It is indicated
that the persons who are already in possession of a licensed
weapon are to be given priority.
27. It is also 1asserted by the appellants that pursuant to
the requisition by the police department options were called
8
upon from ex-servicemen who were willing to be enrolled as
Special Police Officer (SPOs) under section 17 of the Police
Act, 186P.
28. Such a procedure making recruitments thmugh the
C employment exchanges was held to be consistent with the
requirement of Articles 14 and 16 of the Constitution by this
Court in Union of India and Ors. v. N. Hargopal anci Ors. (1987)
3 sec 308. 4
D 29. The abovementioned process clearly indicates it is not
a case where persons like the appellants were arbitrarily
chosen to the exclusion of other eligible candidates. It required
all able bodied persons to be considered by the SSP who was
charged with the responsibility of selecting suitable candidates.
E
3. Paragraph 4 of the Writ petition and at page 34 of the SLP Paperbook:
"That the Governmerit made a policy to enrol the ex-serviceman to guard the
life and property of the Government employees as well as Government
employees. All the petitioners being ex-servicemen enrolled themselves
F in the employment exchange. The police department sent the intimation to
the employment exchange and thereafter all the ex-servicemen who were
enrolled with the Employment Exchange were called upon and got their
option to be enrolled in as Special Police Officer (SPOs) under section 17
of the Police, Act 1861 (hereinafter called as the SPos). Those persons
who were having armed licence were enrolled as SPOs and this enrolment '
was made by th,a Superintendent of Police, Amritsar."
G 4. 9 ..... We, therefore, consider that insistence on recruitment through
Employment Exchanges advances rather than restricts the rights
guaranteed by Article 14 and 16 of the Constitution. The submission that·
Employment Exchanges do not reach everywhere applies equally to
whatever method of advertising vacancies is adopted. Advertisement in the
daily press, for 1example, is also equally ineffeCtive as it does not reach
H everyone desirimg employment.
N'IHAL SINGH v. STATE OF PUNJAB 21
[J. CHELAMESWAR, J.]
30. Such a process of selection is sanctioned by law under A
section 17 of the Act. Viewed in the context of the situation
prevailing at that point of time in the State of Punjab, such a
process cannot be said to be irrational. The need was to obtain
the services of persons who had some experience and training
in handling an extraordinary situation of dealing with armed B
miscreants.
31. It can also be noticed from the written statement of the
Assistant Inspector General of Police (Welfare & Litigation) that
preference was given to persons who are in possession of
licensed weapons. The recruitment of the appellants and other C
similarly situated persons was· made in the background of
terrorism prevailing in the State of Punjab at that time as
acknowledged in the order dated 23.4.2002 of the SSP. The
procedure which is followed during the normal times of making
recruitment by inviting applications and scrutinising the same D
to identify the suitable candidates would itself take considerable
time. Even after such a selection the selected candidates are
required to be provided with necessary arms and also be
trained in the use of such arms. All this process is certainly time
consuming. The requirement of the State was to take swift E
action in an extra-ordinary situation.
32. Therefore, we are of the opinion that the process of
selection adopted in identifying the appellants herein cannot be
said to be unreasonable or arbitrary in the sense that it was
F
devised to eliminate other eligible candidates. It may be
worthwhile to note that in Umadevi's case, this Court was
dealing with appointments made without following any rational
procedure in the lower rungs of various services of the Union
and the States.
G
33. Coming to the other aspect of the matter pointed out
by the High Court - that in the absence of sanctioned posts the
State cannot be compelled to absorb the persons like the
appellants into the services of the State, we can only say that
posts are to be created by the State depending upon the need H
22 SUPREME COURT REPORTS (2013] 11 S.C.R.
A to employ people having regard to various functions the State
undertakes to discharge.
"Every sovereign Government has within its own
jurisdiction right and power to create whatever public
offices it may regard as necessary to its proper functioning
B
and its own internal administration."5
34. It is no doubt that the assessment of the need to employ
a certain number of people for discharging a particular
responsibility of the State under the Constitution is always with
C the executive Government of the day subject to the overall
control of the Legislature. That does not mean that .an
examination by a Constitutional Court regarding the accuracy
of the assessment of the need is barred. This Court in S.S.
Dhanoa v. Union of India (1991) 3 SCC 567 did examine the
D correctness of the assessment made by the executive
government. It was a case where Union of India appointed two
Election Commissioners in addition to the Chief Election
Commissioner just before the general elections to the Lok
Sabha. Subsequent to the elections, the new government
E abolished those posts. While examining the legality of such
abolition, this Court had to deal with an argument6 whether the
5. 42 American Jurisprudence 902 Para 31.
6. "21. In the first instance, the petitioner and the other Election Commissioners
were appointed when the work of the Commission did not warrant their
F appointment. The reason given by respondent 1 (Union of India), that on
account of the Constitution (61 st Amendment) Act reducing the voting age
and the voting age and the Constitution (64th Amendment) and (65th
Amendment) and (65th Amendment) Bills relating to election to the
Panchayats and Nagar Palikas, the work of the Commission was expected
to increase and, therefore, there was need for more Election
G Commissioners, cuts no ice. As has been pointed out by respondent 2,
the work relating to revision of electroal rolls on account of the reduction of
voting age was completed in all the States expect Assam by the end of
July 1989 itself, and at the Conference of the Chief Elecoral Officers at
Tirupati, respondent 2 had declared that the entire preparatory work relating
to the conduct of the then ensuing general elections to the Lok Sabha would
be completed by August in the whole of the country except Assam. Further,
H the Constitution (64th and 65th Amendment) Bills had already fallen in
NIHAL SINGH v. STATE OF PUNJAB 23
[J. CHELAMESWAR, J.]
need to have additional commissioners ceased subsequent to A
the election. It was the case of the Union of India that on the
date posts were created there was a need to have additional
commissioners in view of certain factors such as the reduction
of the lower age limit of the voters etc. This Court categorically
held that "The truth of the matter as is apparent from the record B
is that ....... there was no need for the said appointments ..... ".
35. Therefore, it is clear that the existence of the need for
creation of the posts is a relevant factor reference to which the
executive government is required to take rational decision
based on relevant consideration. In our opinion, when the facts C
such as the ones obtaining in the instant case demonstrate that
there is need for the creation of posts, the failure of the
executive government to apply its mind and take a decision to
create posts or stop extracting work from persons such as the
appellants herein for decades together itself would be arbitrary D
action (inaction) on the part of the State.·
36. The other factor which the State is required to keep in
mind while creating or abolishing posts is the financial
implications involved in such a decision. The creation of posts E
necessarily means additional financial burden on the exchequer
of the State. Depending upon the priorities of the State, the
allocation of the finances is no doubt exclusively within the
domain of the Legislature. However in the instant case creation
of new posts would not create any additional financial burden F
to the State as the various banks at whose disposal the
services of each of the appellants is made available have
agreed to bear the burden. If absorbing the appellants into the
Parliament, before the appointments. In fact, what was needed was more
secretarial staff for which the Commission was pressing, and not more G
Election Commissioners. What instead was done was to appoint the
petitioner and the other Election Commissioner on October 16, 1989.
Admittedly, further the views of the Chief Election Commissioner were not
ascertained before making the said appointments. In fact, he was presented
with them for the first time in the afternoon of the same day, i.e., October
16, 1989. H
24 SUPREME COURT REPORTS (2013] 11 S.C.R.
A services of the State and providing benefits at par with the
police officers of similar rank employed by the State results in
further financial commitment it is always open for the State to
demand the banks to meet such additional burden. Apparently
no such demand has ever been made by the State. The result
B is - the various banks which avail the services of these
appellants enjoy the supply of cheap labour over a period of
decades. It is also pertinent to notice that these banks are
public sector banks. We are of the opinion that neither the
Government of Punjab nor these p~blic sector banks can
C continue such a practice consistent with their obligation to
function in accordance with the Constitution. Umadevi's
judgment cannot become a licence for exploitation by the State
and its instrumentalities.
37. For all the abovementioned reasons, we are of the
D opinion that the appellants are entitled to be absorbed in the
services of the State. The appeals are accordingly allowed. The
judgments under appeal are set aside.
38. We direct the State of Punjab to regularise the services
E of the appellants by creating necessary posts within a period
of three months from today. Upon such regularisation, the
appellants would be entitled to all the benefits of services
attached to the post which are similar in nature already in the
cadre of the police services of the State. We are of the opinion
F that the appellants are entitled to the costs throughout. In the
circumstances, we quantify the costs to Rs.10,000/- to be paid
to each of the appellants.
B.B.B. Appeals allowed.
Search Indian case law
Ask in plain English, not just keywords. 25,000 AI words free, no card.
Try "service law"Sign in to search