Supreme Court of India
PREM SINGHversusSTATE OF UTTAR PRADESH & ORS.
- Citation
- 2019 INSC 983
- Decided
- 2 September 2019
- Disposal
- Disposed off
- Bench
- ARUN MISHRA
Holding
Rule 3(8) of the Uttar Pradesh Retirement Benefits Rules, 1961 is read down to include work‑charged service as qualifying service, and Regulation 370 and Para 669 of the Financial Handbook are struck down as violative of Article 14.
Summary
Prem Singh, a welder, worked for about 37 years in a work‑charged establishment of the Uttar Pradesh government and was later regularised before superannuation. He claimed that the period spent in the work‑charged establishment should be counted as qualifying service for pension under the Uttar Pradesh Retirement Benefits Rules, 1961. The State denied the claim, relying on Rule 3(8) and Regulation 370 of the Civil Services Regulations, which exclude work‑charged service from pensionable service. The Supreme Court held that the exclusion was arbitrary and discriminatory, read down Rule 3(8) to include work‑charged service (even before regularisation) as qualifying service, and struck down Regulation 370 and Para 669 of the Financial Handbook. Consequently, the employees were entitled to pension as if they had served in a regular establishment, with arrears limited to three years. The Court allowed the employees' appeals and dismissed those of the State.
Issues considered
- The period of service rendered in a work‑charged establishment can be counted as qualifying service for pension under the Uttar Pradesh Retirement Benefits Rules, 1961.
- Whether Rule 3(8) of the Uttar Pradesh Retirement Benefits Rules, 1961, and Regulation 370 of the Uttar Pradesh Civil Services Regulations, which exclude work‑charged service, are constitutionally valid.
- Whether the note appended to Rule 3(8) that limits counting of work‑charged service to inter‑temporary periods is permissible.
Legislation cited
- Constitution of Indias. Article 14, s. Article 368
- Employees' State Insurance Act
- Factories Act, 1948
- Financial Handbook Vol. VIs. Para 667, s. Para 668, s. Para 669
- Industrial Disputes Act, 1947
- Industrial Employment (Standing Orders) Act, 1946
- Payment of Gratuity Act
- Uttar Pradesh Civil Services Regulationss. Regulation 361, s. Regulation 368, s. Regulation 370
- Uttar Pradesh Retirement Benefits Rules, 1961s. Rule 3(8)
Subjects
pensionqualifying servicework‑charged establishmentretirement benefitsdiscriminationArticle 14rule reading downregularisationcivil service regulations
Judgment
[2019] 11 S.C.R. 1075 1075
PREM SINGH A
v.
STATE OF UTTAR PRADESH & ORS.
(Civil Appeal No. 6798 of 2019)
SEPTEMBER 02, 2019 B
[ARUN MISHRA, S. ABDUL NAZEER AND
M. R. SHAH, JJ.]
Service Law:
Pension - Computation of qualifying service for grant of C
pension - Period of work-charged services - Whether can be
included in the qualifying service - Employee's service in work-
charged establishment for a period of about 37 years - Thereafter
regularized in the establishment - On superannuation, claim of the
employee for grant of pension by counting the period spent in the
work-charged establishment - Claim denied - Writ petition dismissed D
- Special appeal also dismissed - Appeal to Supreme Court - Held:
In view of r.3(8) of Retirement Benefits Rules and Regulations, 361,
368 and 370 of Civil Services Regulations and Para 669 of
Financial Handbook Vol. VI relating to engagement of employees
in the work-charged establishment, employees in work-charged E
establishment are not entitled to pension - In the present case
appointment of work-charged employee was on monthly salary and
the employee was also required to cross the efficiency bar - There
was nothing to indicate qualitative difference of the employee from
the regular employees - Rather, the employer had misused the very
concept of work-charged employment on exploitative terms for the F
work which was regular and perennial in nature - Note to r. 3(8)
of 1961 Rules provides for counting the period of work-charged
employment if that period is between two temporary employments
or in between temporary and permanent employment - The Note is
irrational and discriminatory and makes impermissible classification G
in not counting the work-charged employment if it is rendered
before regularization - In order to make the rule valid and non-
discriminatory, Note to r.3(8) is read down that work-charged
services rendered even prior to regularization, contingency paid
fund employees or non-pensionable establishment shall also be
H
1075
1076 SUPREME COURT REPORTS [2019] 11 S.C.R.
A counted towards the qualifying service even if such service is not
preceded by temporary or regular appointment in a pensionable
establishment - The provision contained in Regulation 370 and the
instructions contained in Para 669 of the Financial Handbook is
struck down - Services of some other work-charged employees, who
superannuated without being regularized even after rendering
B service of 30-40 years ought to have been regularized under the
Government instructions and also as per the decision in *Uma
Devi case - Services of such employees be treated regular and
hence be treated entitled to receive pension - Uttar Pradesh
Retirement Benefits Rules, 1961 - r. 3(8) - Uttar Pradesh Civil
C Services Regulations - Regulation 370 - Financial Handbook Vol.
VI - Para 669.
Allowing the appeals filed by the employees and dismissing
those filed by the State/employer, the Court
HELD: 1.1 The qualifying service is the one which is in
D accordance with the provisions of Regulation 368 of Uttar
Pradesh Civil Services Regulations i.e. holding a substantive
post on a permanent establishment. The proviso to Rule 3(8)
of Uttar Pradesh Retirement Benefits Rules, 1961 clarify that
continuous, temporary or officiating service followed without
E interruption by confirmation in the same or any other post is also
included in the qualifying service except in the case of periods
of temporary and officiating service in a non-pensionable
establishment. The service in work-charged establishment and
period of service in a post, paid from contingencies shall also
not count as qualifying service. The Note appended to Rule 3(8)
F contains a clear provision to count the qualifying service
rendered in work-charged, contingency paid and non-
pensionable establishment to be counted towards pensionable
service, in the exigencies provided therein. [Paras 10 and 11]
[1085-F-H; 1086-B]
G
1.2 The provisions contained in Regulation 370 of the Civil
Services Regulations excludes service in a non-pensionable
establishment, work-charged establishment and in a post, paid
from contingencies from the purview of qualifying service. Under
Regulation 361 of the Civil Services Regulations, the services
H must be under the Government and the employment must be
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1077
substantive and permanent basis. Para 669 of the Financial A
Handbook Vol. VI relating to engagement of employees in the
work charged establishment provides that except in the case as
mentioned thereunder the members of work-charged
establishment are not entitled to any pension or to leave salary
or allowances. [Paras 12, 13 and 14] [1086-C-D; 1088-C]
B
1.3 The appointment of the work-charged employee in the
present case had been made on monthly salary and they were
required to cross the efficiency bar also. No material indicating
qualitative difference from regular employees has been pointed
out except making bald statement. The appointment was not
C
made for a particular project which is the basic concept of the
work charged employees. Rather, the very concept of work-
charged employment has been misused by offering the
employment on exploitative terms for the work which is regular
and perennial in nature. The work-charged employees had been
subjected to transfer from one place to another like regular D
employees as apparent from documents placed on record. [Para
29] [1104-E-G]
1.4 It was unfair on the part of the State Government and
its officials to take work from the employees on the work-
charged basis. They ought to have resorted to an appointment E
on regular basis. The taking of work on the work-charged basis
for long amounts to adopting the exploitative device. Later on,
though their services have been regularized, the period spent
by them in the work-charged establishment has not been
counted towards the qualifying service. Thus, they have not only F
been deprived of their due emoluments during the period they
served on less salary in work charged establishment but have
also been deprived of counting of the period for pensionary
benefits as if no services had been rendered by them. The State
has been benefitted by the services rendered by them in the G
heydays of their life on less salary in work-charged
establishment. [Para 30] [1105-C-E]
1.5 In view of the note appended to Rule 3(8) of the 1961
Rules, there is a provision to count service spent on work
charged, contingencies or non pensionable service, in case, a H
1078 SUPREME COURT REPORTS [2019] 11 S.C.R.
A person has rendered such service in a given between period of
two temporary appointments in the pensionable establishment
or has rendered such service in the interregnum two periods of
temporary and permanent employment. The work-charged
service can be counted as qualifying service for pension in the
aforesaid exigencies. [Para 31] [1105-F]
B
1.6 Once regularization had been made on vacant posts,
though the employee had not served prior to that on temporary
basis, considering the nature of appointment, though it was not
a regular appointment it was made on monthly salary and
thereafter in the pay scale of work-charged establishment the
C
efficiency bar was permitted to be crossed, it would be highly
discriminatory and irrational because of the rider contained in
Note to Rule 3(8) of 1961 Rules, not to count such service
particularly, when it can be counted, in case such service is
sandwiched between two temporary or in-between temporary
D and permanent services. There is no rhyme or reason not
to count the service of work-charged period in case it has been
rendered before regularisation. [Para 32] [1105-G-H; 1106-A-
B]
1.7 An impermissible classification has been made under
E Rule 3(8). It would be highly unjust, impermissible and irrational
to deprive such employees benefit of the qualifying service.
Service of work-charged period remains the same for all the
employees, once it is to be counted for one class, it has to be
counted for all to prevent discrimination. The classification
cannot be done on the irrational basis and when respondents are
F themselves counting period spent in such service, it would be
highly discriminatory not to count the service on the basis of
flimsy classification. The rider put on that work-charged service
should have preceded by temporary capacity is discriminatory
and irrational and creates an impermissible classification. [Para
G 32] [1106-B-D]
1.8 As it would be unjust, illegal and impermissible to
make aforesaid classification to make Rule 3(8) valid and non
discriminatory, the provisions of Rule 3(8) has to be read down
and held that services rendered even prior to regularisation in
H the capacity of work-charged employees, contingency paid fund
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1079
employees or non-pensionable establishment shall also be A
counted towards the qualifying service even if such service is
not preceded by temporary or regular appointment in a
pensionable establishment. [Para 33] [1106-D-E]
1.9 In view of the Note appended to Rule 3(8), which has
been read down, the provision contained in Regulation 370 of B
the Civil Services Regulations has to be struck down as also
the instructions contained in Para 669 of the Financial Handbook.
[Para 34] [1106-F]
1.10 In view of reading down Rule 3(8) of the U.P.
Retirement Benefits Rules, 1961, the services rendered in the
C
work-charged establishment shall be treated as qualifying
service under the aforesaid rule for grant of pension. [Para 36]
[1107-C]
Punjab State Electricity Board & Anr. v. Narata Singh
and Anr. (2010) 4 SCC 317 : [ 2010] 3 SCR 27 ;
Punjab State Electricity Board v. Narata Singh (2010) D
4 SCC 317: [2010] 3 SCR 27 - relied on.
Jaswant Singh & Ors. v. Union of India & Ors. (1979)
4 SCC 440 : [1980] 1 SCR 420; State of Rajasthan v.
Kunji Raman (1997) 2 SCC 517 : [1996] 10 Suppl.
SCR255; Punjab State Electricity Board v. Jagjiwan E
Ram (2009) 3 SCC 661 : [2009] 3 SCR 209 -
distinguished.
Kesar Singh v. the State of Punjab AIR 1988 Punjab
and Haryana 265 - approved.
2. There are some of the employees who have not been F
regularized in spite of having rendered the services for 30-40
or more years whereas they have been superannuated. As they
have worked in the work-charged establishment, not against any
particular project, their services ought to have been regularized
under the Government instructions and even as per the decision
of this Court in *Uma Devi case, wherein it was laid down that G
in case services have been rendered for more than ten years
without the cover of the Court's order, as one time measure,
the services be regularized of such employees. Those
employees who have worked for ten years or more should have
been regularized. It would not be proper to regulate them for H
1080 SUPREME COURT REPORTS [2019] 11 S.C.R.
A consideration of regularisation as others have been regularised.
It is directed that their services be treated as a regular one.
However, it is made clear that they shall not be entitled to
claiming any dues of difference in wages, had they been
continued in service regularly before attaining the age of
superannuation. They shall be entitled to receive the pension
B
as if they have retired from the regular establishment and the
services rendered by them right from the day they entered the
work-charged establishment shall be counted as qualifying
service for the purpose of pension. [Para 35] [1106-G-H; 1107-
A-B]
C *Secretary, State of Karnataka & Ors. v. Uma Devi
(2006) 4 SCC 1 : [2006] 3 SCR 953 - followed.
Case Law Reference
AIR 1988 P & H 265 approved Para 1
D [2010] 3 SCR 27 relied on Para 4
[1980] 1 SCR 420 distinguished Para 22
[1996] 10 Suppl. SCR 255 distinguished Para 25
[2009] 3 SCR 209 distinguished Para 26
E [2006] 3 SCR 953 followed Para 35
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6798
of 2019.
From the Judgment and Order dated 21.07.2009 of the High
F Court of Judicature at Allahabad in Special Appeal No. 811 of 2009.
With
Civil Appeal Nos. 6804, 6799-6803, 6938-6942, 6805, 6806, 6937,
6943, 6810, 6944, 6945, 6808 6809, 6946, 6825, 6947, 6948, 6949, 6811,
6812, 6807, 6950, 6813, 6951, 6952, 6953, 6954, 6955, 6956, 6957, 6826,
G
6958, 6959, 6960, 6961, 6962, 6963, 6964, 6965, 6827, 6819, 6828, 6816,
6817, 6815, 6824, 6818, 6814, 6834, 6823. 6822, 6821, 6820, 6833, 6838,
6832, 6829, 6831, 6830, 6844, 6835, 6839, 6840, 6837, 6836, 6843, 6853,
6846, 6841, 6842, 6845, 6856, 6855, 6858, 6852, 6847, 6850, 6857, 6859,
6848, 6849, 6860, 6851, 6864, 6861, 6862, 6854, 6863, 6866, 6869, 6877,
H 6870, 6868, 6876, 6874, 6879, 6865, 6875, 6871, 6878, 6867, 6873, 6872,
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1081
6882, 6881, 6884, 6880, 6883, 6900, 6885, 6887, 6886, 6888, 6889, 6890, A
6891, 6895, 6892, 6896, 6897, 6893, 6898, 6894, 6901, 6899, 6904, 6903,
6905, 6902, 6927-6929, 6906, 6907, 6908, 6909, 6910, 6911, 6912, 6930,
6913, 6914, 6915, 6916, 6917, 6918, 6919, 6921, 6923, 6925, 6920, 6924,
6922, 6931, 6932, 6926 of 2019, MA 1541/2018 in SLP(C) 19310/2017,
MA 1542/2018 in SLP(C) 19234/2017, MA 1544/2018 in SLP(C)
B
19346/2017, MA 1545/2018 in SLP(C) 19350/2017, MA 1546/2018 in
SLP(C) 19740/2017, MA 1543/2018 in SLP(C) 19297/2017.
Raghavendra Singh, AG, Ms. Aishwarya Bhati, AAG, Kuldeep
Singh Parihar, DAG, Sanat Kumar, AAG, Amarendra Sharan, Anand
Grover, Mahabir Singh, Ms. Sukriti Bhatnagar, Sanchit Guru, Samarth
C
Khanna, Shourya Bari, Mrs. Rachna Gupta, Ms. Rachana Srivastava,
Ashutosh Sharma, Ms. Umme Salma, Aviral Saxena, Anurag Pandey,
Ms. Priyam Lizmary Cherian, Ms. Preeti Singh, Gagan Deep Sharma,
Dr. Swati Jindal Garg, Shivam Jaiswal, Rajeev Kumar Dubey, Abhishek
Singh Tomar, Nitin, Ashiwan Mishra, Kamlendra Mishra, Ajay Vikram
Singh, Ms. Priyanka Singh, Kamlesh Anand, Ms. Rachana Srivastava D
Ashutosh Kumar Sharma, Harish Chandra Pant, Sandeep Garausa, Anis
Ahmed Khan, S. S. Rawat, Ms. Namita Chaudhary, Ms. Rachna
Gandhi, Ajay Vikram Singh, Mukesh Kumar Sharma, Ms. Shweta
Shukla, Ms. Vanshaja Shukla, Anurag Pandey, Dinesh Kumar Garg,
Abhishek Garg, Dhananjay Garg, Deepak Mishra, Sudarshan Singh E
Rawat, Nachiketa Joshi, Jaswant Singh Rawat, Vikas Negi, Virendra
S. Rawat, Atul Sharma, Ms. Manju Jetley, S. R. Setia, Mithilesh Kumar
Singh, Himanshu Tyagi, Abhishek Singh, Farrukh Rasheed, Khalid Israr,
Anand Mishra, Amrendra Kumar Singh, Ms. Vandana Kumar, Ms.
Anisha Upadhyay, Surender Kumar, Pawan Upadhyay, Nishant Kumar,
F
B. K. Pal, Ajit Singh Pundir, Arijeet Singh, D.V. Singh, R. Karrupiah,
Aditya Giri, Abhishek Singh, Manohar Pratap, Sanpreet Singh Ajmani,
Ayush Negi, Ms. Vishakha Upadhyay, Ms. Vanshaja Shukla, M.P. Pant,
Ankur Yadav, Aakash Kumar, Rajesh Pathak, Abhishek Chakraborty,
Pramod Kumar, Rajesh Pathak, Sumit Kumar, Nishant Ramakantrao
Katneshwarkar, Anoop Kandari, Ravindra S. Garia, Harshit Sanwal, G
Janmejay Verma, Ms. Akansha Verma, S. K. Verma, Pradeep Kr.
Yadav, Ms. Sheenu Chauhan, Sanjeev Malhotra, Ms. Vijay Laxmi,
Anand Vardhan Maitreya, Satish Kumar, Ardhendumauli Kumar Prasad,
Ankur Yadav, Mithilesh Kr. Singh, Tarun Verma, Ms. Manju Singh,
Advs. for the appearing parties. H
1082 SUPREME COURT REPORTS [2019] 11 S.C.R.
A The Judgment of the Court was delivered by
ARUN MISHRA, J.
1. The question involved in the present matters is whether Rule
3(8) of the U.P. Retirement Benefit Rules, 1961 (in short “Rules of
1961”) and Regulation 370 of the Civil Services Regulation of Uttar
B Pradesh should be struck down having regard to the fact that this Court
has upheld the decision regarding pari materia provision enacted in
the State of Punjab which excluded computation of the period of work-
charged services from qualifying service for pension. This Court has
affirmed the decision of the High Court of State of Punjab and Haryana
C rendered in Kesar Singh v. the State of Punjab, AIR 1988 Punjab
and Haryana 265.
2. A Division Bench of this Court has referred the matter to be
considered by a larger bench. Hence the matter is before us.
3. The facts are being narrated from Prem Singh v. State of
D Uttar Pradesh (Special Leave Petition (Civil) No.4371 of 2011). The
appelant was appointed as a Welder in the year 1965 in a work-charged
establishment (Ram Ganga River Valley Project, Kalagarh). He was
transferred from one place to another and thereafter ultimately the
Selection Committee recommended for regularization of his services.
His services were regularized on 13.3.2002 and was posted as Pump
E Operator in the pay scale of Rs.3050-4590 in the regular establishment.
He superannuated on 31.1.2007. Then he filed a writ petition in the
High Court on 31.7.2008 to count period spent in the work-charged
establishment as qualifying service under the Rules of 1965. The High
Court directed to submit a representation, accordingly it was filed which
F met with rejection on 12.12.2008. Yet another representation filed also
met with the same fate vide order dated 23.3.2009. The writ petition
and special appeal had been dismissed.
4. The appellant has placed reliance upon the decision of this
Court in Habib Khan vs. State of Uttarakhand (Civil Appeal
G No.10805-10807 of 2017) in which a Division Bench of this Court
considering Regulation 370 of the Civil Service Regulations which has
been approved in the State of Uttarakhand after its bifurcation from
the State of Uttar Pradesh, held that Regulation 370 is pari materia
provision to the one as contained in Rule 3.17 (ii) of the Punjab Civil
Services Rules which had been struck down by a Full Bench decision
H of Punjab and Haryana High Court in Kesar Chand vs. State of
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1083
[ARUN MISHRA, J.]
Punjab and Ors. (supra). The challenge to the same was rejected by A
this Court. The Court has further relied on Punjab State Electricity
Board & Anr. v. Narata Singh and Anr., (2010) 4 SCC 317 in which
it has been observed that the High Court of Punjab and Haryana was
perfectly justified in striking down Rule 3.17(ii) of Punjab Civil Services
Rules resulting in obliteration of the distinction made in said rule between
temporary and officiating service and work-charged service. This Court B
held that period of work-charged service should be counted for
computation of qualifying service for grant of pension.
5. This Court in other cases has followed the aforesaid decision
in Habib Khan v. State of Uttarakhand (supra) giving relief to the
employees. In Ram Deo Tiwari v. State of Uttar Pradesh & Ors. C
(Civil Appeal No.2896 of 2018) decided on 16.3.2018, the decision of
Habib Khan (supra) has been followed. This Court has dismissed the
Review application filed in the case of Habib Khan (supra).
6. It is submitted by Shri Raghuvendra Singh, learned Advocate
General appearing for the State of Uttar Pradesh that there is a D
difference in the Rules and Regulations in Uttar Pradesh and Punjab.
The rule of Punjab was struck down by the High Court in Kesar Chand
vs. State of Punjab (supra). In Punjab, there was deemed regularization
whereas in State of Uttar Pradesh services have been regularized on
a particular date; as such that date has to be taken as the E
commencement of the services for the qualifying period for a pension
under Rule 3(8) of the Rules. He has also pointed out the conceptual
difference between regular and work-charged employees. Work-
charged employees are not appointed by following the same procedure
as that of regular employees. Work pressure and accountability also
differ. He has further submitted that work-charged services cannot be F
treated as regular service even for Assured Career Progression (ACP).
The Government has the power to frame different rules for different
classes of employees as such Rule 3(8) of the Rules and Regulation
370 cannot be said to be arbitrary and discriminatory. Though, work-
charged employees can claim protection under the Industrial Disputes
G
Act, 1947 but cannot be treated at par with employees of regular
establishment. Treating them similarly would be like giving similar
treatment to unequal classes which would be against the Right to
Equality provided under Article 14 of the Constitution of India. Work-
charged employee forms a separate and distinct class. They cannot be
treated at par with regular, temporary or ad-hoc employees. The work H
1084 SUPREME COURT REPORTS [2019] 11 S.C.R.
A is qualitatively different as such services in the work-charged
establishment cannot be clubbed with the services of a regular
establishment unless a specific provision to that effect is made. Giving
the benefit of pension to work-charged employees is against the basic
concept of pension which is admissible to a regular employee. The
pension cannot be claimed as of right.
B
7. He further submitted that the decision in Kesar Chand (supra)
is per incuriam. Hence relied on the Secretary, State of Karnataka
v. Uma Devi & Ors. 2006 (4) SCC 1. It is further submitted that
economy of the State would collapse in case pension is paid treating
the work charged period as qualifying service. It is practically difficult
C and financial burden would be cast upon the State in case these petitions
are allowed. The pension can be paid only under the rules. In Narata
Singh (supra) validity of Punjab Regulations has not been examined.
Since there is a reference made by the Division Bench doubting the
correctness of Habib Khan (supra), the same deserves to be held per
D incuriam and cannot be said to be laying down a good law.
8. We first consider the provisions contained in the Uttar Pradesh
Retirement Benefits Rules 1961 (for short, “the 1961 Rules”). Rule 3(8)
of Rules of 1961 which contains the provisions in respect of qualifying
service is extracted hereunder:
E “Rule 3. In these rules, unless is anything repugnant in the subject
or context-
(1) ……..
(2) ……..
(8) “Qualifying service” means service which qualifies for
F
pension in accordance with the provisions of Article 368 of the
Civil Service Regulations.
Provided that continuous temporary or officiating service under
the Government of Uttar Pradesh followed without interruption
by confirmation in the same or any other post except-
G
(i) periods of temporary or officiating service in a non-
pensionable establishment.
(ii) periods of service in a work-charged establishment and
(iii) periods of service in a post paid from contingencies shall
H also count as qualifying service.
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1085
[ARUN MISHRA, J.]
Note:-If service rendered in a non-pensionable establishment A
work-charged establishment or in a post paid from contingencies
falls between two periods of temporary service in a pensionable
establishment or between a period of temporary service and
permanent service in a pensionable establishment, it will not
constitute an interruption of service.” B
(emphasis supplied)
9. Regulations 361, 368 and 370 of Uttar Pradesh Civil Services
Regulations are also relevant. They are extracted hereunder:
“361. The service of an officer does not qualify for pension unless C
it conforms to the following three conditions: -
First - The service must be under Government.
Second - The employment must be substantive and permanent.
These three conditions are fully explained in the following D
Section.
368. Service does not qualify unless the officer holds a
substantive office on a permanent establishment.
370. Continuous temporary or officiating service under the
Government of Uttar Pradesh followed without interruption by E
confirmation in the same or any other post shall qualify, except-
(i) periods of temporary or officiating service in non-
pensionable establishment;
(ii) periods of service in work charged establishment; and F
(iii) periods of service in a post paid from contingencies.”
10. The qualifying service is the one which is in accordance with
the provisions of Regulation 368 i.e. holding a substantive post on a
permanent establishment. The proviso to Rule 3(8) clarify that
continuous, temporary or officiating service followed without interruption G
by confirmation in the same or any other post is also included in the
qualifying service except in the case of periods of temporary and
officiating service in a non-pensionable establishment. The service in
work-charged establishment and period of service in a post paid from
contingencies shall also not count as qualifying service. H
1086 SUPREME COURT REPORTS [2019] 11 S.C.R.
A 11. The Note appended to Rule 3(8) contains a provision that if
the service is rendered in a non-pensionable establishment, work-charged
establishment or in a post paid from contingencies, falls between two
periods of temporary service in a pensionable establishment or between
a period of temporary service and permanent service in a pensionable
establishment, it will not constitute an interruption of service. Thus, note
B contains a clear provision to count the qualifying service rendered in
work-charged, contingency paid and non-pensionable establishment to
be counted towards pensionable service, in the exigencies provided
therein.
12. The provisions contained in Regulation 370 of the Civil
C Services Regulations excludes service in a non-pensionable
establishment, work-charged establishment and in a post paid from
contingencies from the purview of qualifying service. Under Regulation
361 of the Civil Services Regulations, the services must be under the
Government and the employment must be substantive and permanent
basis.
D
13. The provisions contained in the Financial Handbook Vol. VI
relating to engagement of employees in the work charged establishment
in Paras 667, 668 and 669, are extracted hereunder:
“667. Work-charged establishment will include such establishment
E as is employed upon the actual execution, as distinct from the
general supervision, of a specific work or sub-works of a specific
project or upon the subordinate supervision of departmental
labour, stores, and machinery in connection with such work or
sub-works. When employees borne on the temporary
establishment are employed on work of this nature their pay
F should, for the time being, be charged direct to the work.
Notes - (1) Persons who actually do the work with their hands,
such as, beldars, masons, carpenters, fitters, mechanics, drivers,
etc., should be engaged only when works are carried out
departmentally, and charged to works. In cases in which it is
G considered necessary, as a safeguard against damage to the
Government Tools and Plant, such as road-rollers, concrete-
mixture, pumping-sets, and other machinery, mechanics, drivers,
etc., may be engaged by the Department or alternatively, if
engaged by the contractor must be subject to approval by the
department, whether the work is done departmentally or by
H contract.
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1087
[ARUN MISHRA, J.]
(2) Mistries and work agent should, in all circumstances, whether A
they are employed on works executed departmentally or on
contract, be charged to “works”.
(3) Subject to the general principles stated in Paras 665 to 667
being observed, the classes of establishment not covered by these
definitions may be classified as “work-charged, or temporary”, B
as the case may be, and the rule which prescribes that work-
charged establishment must be employed upon a specific work
waived, with the previous sanction of the Government and
concurrence of the Accountant General. In such cases, the
Government shall also determine in consultation with the
Accountant General, the proportions in which the cost of such C
establishment shall be allocated between the works concerned.
668. In all the cases previous sanction of the competent authority
as laid down in Vol. I of the Handbook or in the departmental
manuals of orders is necessary, which should specify in respect
of each appointment (1) the consolidated rate of pay, (2) the D
period of sanction, and (3) the full name (as given in the estimate)
of the work and the nature of the duties on which the person
engaged would be employed.
669. Members of the work-charged establishment are not entitled
to any pension or to leave salary or allowances except in the E
following cases:
(a) Wound and other extraordinary pensions and gratuities are
in certain cases admissible in accordance with the rules in Part
VI of the Civil Service Regulations.
(b) Travelling and daily allowance may be allowed by divisional F
officers for journeys performed within the State in the interest
of work on which the persons are employed on the following
conditions:
(i) The journey should be sanctioned by the divisional officer
or the sub-divisional officer/ assistant engineer specifically G
authorized for the purpose by the divisional officer;
(ii) the concerned officer while sanctioning the journey should
also certify that the journey is actually necessary and
unavoidable in the interest of the work on which the person
is employed: H
1088 SUPREME COURT REPORTS [2019] 11 S.C.R.
A (iii) for the journeys so performed the work-charged employee
may be allowed travelling and daily allowance at the same
rates and on the same conditions as are applicable to a
regular government servant of equivalent status.
4. All facilities and concessions admissible to workmen of facto-
B ries registered under the Factories Act, 1948, are also admissible
to the employees of the registered State Workshops and Facto-
ries.”
14. Para 669 of the manual provides that except in the case as
mentioned thereunder the members of work-charged establishment are
C not entitled to any pension or to leave salary or allowances.
15. In Kesar Chand v. the State of Punjab, AIR 1988 Punjab
and Haryana (supra) has been rendered by Full Bench of Punjab and
Haryana High Court. The Rule 3.17 (ii) of the Punjab Rules came up
for consideration before the Full Bench which reads as under:
D Rule 3.17. “if an employee was holding substantively a permanent
post on the date of his retirement, his temporary or officiating
service under the State Government, followed without interruption
by confirmation in the same or another post, shall count in Full
as qualifying service except in respect of -
E (i) periods of temporary or officiating service in non-
pensionable establishment;
(ii) periods of service in work-charged establishment; and
(iii) ……”
16. A Full Bench of the High Court in Kesar Chand (supra) has
F
discussed the matter thus:
“19. In the light of the above, let us examine the validity of rule
3.17(ii) of the Punjab Civil Services Rules, Vol. II. This rule says
that the period of service in a work-charged establishment shall
not be taken into account in calculating the qualifying service.
G After the services of a work-charged employee have been
regularised he becomes a public servant. The service is under
the Government and is paid by it. This is what was precisely stated
in the Industrial Award dated June 1, 1972, between the workmen
and the Chief Engineer, P.W.D. (B. & R), Establishment Branch,
H Punjab, Patiala, which was published in the Government Gazette
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1089
[ARUN MISHRA, J.]
dated July 14, 1972. Even otherwise. the matter was settled by A
the Punjab Government Memo No.14095-BRI (3)-72/5383 dated
6th February 1973(Annexure P7) where it was stated that all
those work charged employees who had put in ten years of
service or more as on 15th August 1972, their services would
be deemed to have been regularised. Once the services of a
work-charged employee have been regularised, there appears to B
be hardly any logic to deprive him of the pensionary benefits as
are available to other public servants under Rule 3.17 of the
Rules. Equal protection of laws must mean the protection of equal
laws for all persons similarly situated. Article 14 strikes at
arbitrariness because an arbitrary provision involves negation C
equality. Even the temporary or officiating service under the State
Government has to be reckoned for determining the qualifying
service. It looks to be illogical that the period of service spent
by an employee in a work-charged establishment before his
regularisation has not been taken into consideration for
determining his qualifying service. The classification which is D
sought to be made among Government servants who are eligible
for pension and those who started as work-charged employees
and their services regularised subsequently, and the others are
based on any intelligible criteria and, therefore, is not sustainable
at law. After the services of a work-charged employee have E
been regularised, he is a public servant like other servant. To
deprive him of the pension is not only unjust and inequitable but
is hit by the vice of arbitrariness, and for these reasons, the
provisions of sub-rule (ii) of Rule 3.17 of the Rules have to be
struck down being violative of Article 14 of the Constitution.
F
20. In relaxation of Rule 3.17(ii) of Rules by the respondent-
authorities, the service of sixteen work-charged employees was
counted for pensionary benefits and gratuity vide Government
of Punjab, Department of Irrigation and Power (Irrigation
Branch) Memo No. 2/5/81/- IB(6)/16411 dated 7th November,
1982(Annexure P2) which reads as under :-- G
“Sanction of the Government of Punjab is accorded in
relaxation of Rule 3.17 of Punjab Civil Services Rule, Vol. II
for counting of previous work-charged service towards
gratuity in respect of 16 work-charged employees of Nangal
Workshop mentioned in the enclosed statement subject to the H
1090 SUPREME COURT REPORTS [2019] 11 S.C.R.
A Conditions that no terminal benefit is/has been given to these
work-charged employees at the time of regularisation of their
service.
Sanction of the Governor of Punjab is also accorded to the
counting of service of these 16 work-charged employees
B towards pension as a special case provided no benefit has
already been drawn by them in lieu of pensionary benefits.”
If respondent No. 1 has granted exemption from rules in
certain cases, we do not find any justifiable reason for
excluding others from the grant of pension and gratuity
C benefits. For this reason, too, we find Rule 3.17(ii) is bad
at law, as it enables the Government to discriminate
between employees similarly situated.
21. In fairness to Mr. Bedi, the learned Addl. Advocate-General,
the submission made by him may be adverted to. It was
D contended that (i) a work-charged employee is engaged for a
particular purpose upon completion of which his services come
to an end, (ii) no order has been passed by the State Government
confirming the petitioner against the post on which his services
are regularised and resultantly he does not fulfil the conditions
entitling a Government servant for pension, as envisaged by Rule
E 3.12 of the Rules. The counsel also tried to justify the
Government action by placing reliance on Rule 1.4 of the Punjab
Civil Services Rules, Vol. I. It was further contended that P.W.D.
(B & R), Establishment Branch is not an industry and in support
of this submission he relied on State of Punjab v. Kuldip Singh,
ILR (1982) 2 Punj. and Har 544; (AIR 1983 NOC 94) (FB) and
F
Om Parkash v. The Management of M/s. Executive Engineer,
SYL Division, Kurukshetra, ILR (1984) 2 Punj. & Har. 215:
(1984 Lab IC 1165) (FB) .
22. His first submission is devoid of any merit. In para 3 of the
petition, it is specifically averred that the petitioner had regular
G
service, without any break of a single day, right from 1951 to
the date of his superannuation in the year 1977. In the
corresponding para of the written statement, this assertion has
not been denied but the only plea taken is that his qualifying
service for pension and gratuity starts from 15th August 1972,
H i.e., the day from which he was brought on regular cadre; and
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1091
[ARUN MISHRA, J.]
that his service in the work-charged establishment does not count A
for pension under R. 3.17(ii) of the Rules. The plea that he has
been in continuous service has not been denied. It appears that
on the completion of one project, the petitioners were engaged
in another project either with break in service or without any
break. Every plea raised in a petition has to be specifically denied
and in the absence of a specific denial, the assertions made in B
the petition will normally be deemed to have been admitted or at
least the court can proceed on the basis that it is an
uncontroverted fact. Since there is no denial by the respondents
that the petitioner has been in continuous service since 1951, it
would be presumed that he has been in continuous service till C
the date of superannuation. The second contention that no order
has been passed by the State Government confirming the
petitioner against the post on which his services were regularised,
and so on, is also without merit. The regularisation of services
must be against a particular post, and the petitioner will be deemed
to have been made permanent on the post against which his D
services have been regularised. This precisely appears to be the
purport of the Punjab Government Memo (Annexure P7), and
the award of the Industrial Tribunal dated June 1, 1972, published
in the Government Gazette dated July 14, 1972, referred to
earlier. In the award, it was specifically held that the work- E
charged employees who had put in three years of continuous
service are entitled to be made permanent and to be confirmed
after having put in five years' service as demanded by the
workmen. The award may bind the workmen and the
management of the P.W.D. (B&R) Establishment Branch.
Technically speaking it may not be binding on other branches of F
the P.W.D. Once the services of a work-charged employee are
regularised he will be deemed to be entitled to the benefit under
R. 3.17 of the Rules.”
(emphasis supplied)
G
The services were deemed to have been regularized on the
completion of ten years of the service as per Punjab Government Memo
dated 6th February 1983. Even otherwise, the High Court has held that
once the employees have been regularized, there appears to be hardly
any logic to deprive them of their pensionary benefits as available to
them under the Rule 3.17 of the Punjab Civil Services Rules. It would H
1092 SUPREME COURT REPORTS [2019] 11 S.C.R.
A be unjust and inequitable to deprive them of parity rendered under work-
charged establishment.
17. It has also been held that the exemption was granted from
the rules in certain cases. Since the rule enables the Government to
discriminate between similarly situated employees the same deserved
B to be struck down. There is no reason to exclude others from the grant
of pension and gratuity benefits. The aforesaid decision has not been
interfered by this Court.
18. In Punjab State Electricity Board v. Narata Singh (2010)
4 SCC 317, this Court once again considered the similar question of
C determination of qualifying service for grant of pensionary benefits, in
particular, the benefit of the previous service in work-charged capacity
with the State Government and whether it can be included as
pensionable service. The Punjab State Electricity Board by Circular
dated 25.5.1985 adopted policy decision of State Government contained
in the letter dated 20.5.1982. The effect of the adoption of the policy
D
decision was that temporary employees who had been retrenched from
the services of Central/State Government and have succeeded in
obtaining employment in Punjab State Electricity Board are entitled to
count prior service rendered under Central/State Government, to the
extent, such service was qualified for grant of pension under the rule
E of Central/ State Government. Relying upon Kesar Chand v. the State
of Punjab (supra) it has been held that employee holding substantively
a permanent post on the date of retirement is entitled to count in full
as qualifying service the period of service rendered in the work-charged
establishment. Thus, the department could not have excluded the same
on the ground that it was rendered on the non-pensionable
F establishment.
19. The facts in the case of Narata Singh (supra) were that
the Respondent No.1 was employed on a work-charged basis from
1.2.1952 to 18.9.1953. From 25.9.1953 he joined as a work-charged
employee in Bhakra Dam Project and resigned therefrom on 27.1.1962.
G
He thereafter joined the Beas Dam Project on 1.2.1962 and worked
at the said project till 15.4.1978 as a work-charged employee. He was
retrenched from that project w.e.f. 15.4.1978 and was paid retrenchment
compensation by the competent authority of the project. Bhakra Dam
Project and Beas Dam Project are under the Department of Irrigation
H and Power, State of Punjab. Thus, the services rendered under the two
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1093
[ARUN MISHRA, J.]
projects were in fact services under the State of Punjab. The respondent A
No.1 was then appointed on the work-charged basis by Punjab State
Electricity Board as Special Foremen w.e.f. 6.8.1982 to 5.1.1984. Then
on 6.1.1984, he was appointed on a regular basis. On attaining the age
of superannuation, he moved a representation for grant of pension and
other retiral benefits based on taking into account the entire service
B
rendered by him on the work-charged basis under the State
Government. By order dated 25.1.1991, the pension was declined and
the only gratuity was paid to him. The stand of the Board was that
respondent No.1 served for 7 years 11 months and 25 days. As such
he was not entitled to grant of pension. The Division Bench of the High
Court allowed the writ petition and directed Board to include work- C
charged service rendered by respondent No.1 with the State of Punjab,
to determine qualifying service for grant of pension. The Court also
relied upon circular dated 29.5.1992. As the appeal was preferred in
this Court, the case was remitted for consideration on merits of the
Contributory Provident Fund Scheme. Thereafter, Single Judge
dismissed the writ application which was questioned in the Letters Patent D
Appeal filed by Narata Singh. The Division Bench after taking into
consideration the documents which were filed directed reconsideration
of the matter and kept the appeal pending. Again, the Board rejected
the matter by speaking order dated 16.11.2005. Thereafter, the appeal
was decided by the High Court for grant of pensionary benefits on the E
ground that he served in the work-charged capacity which was outside
the purview of the Board and the said service was non-pensionable so
far as the State Government was concerned. Relying upon the Kesar
Chand v. State of Punjab, the Division Bench concluded that the rule
which excluded the counting of work-charged service of an employee
whose services were regularized subsequently was bad in law. The F
Central/State Government in consultation decided to share the
proportionate pension liability on a pro-rata, service share basis. The
effect of the policy decision of the Central Government and State
Government was that temporary employee, who has been retrenched
from the services of Central/ State Government and had secured G
employment with the Punjab State Electricity Board was entitled to
count temporary service rendered by him under the Central/ State
Government to the extent that such service was qualified for grant of
pension under rules of Central/ State Government. This Court in
Narata Singh (supra) relied upon Kesar Chand (supra) and has
observed: H
1094 SUPREME COURT REPORTS [2019] 11 S.C.R.
A “25. In Kesar Chand v. State of Punjab 1988 (5) SLR 27
(P&H) the Full Bench held that Rule 3.17(ii) of the Punjab Civil
Services Rules was violative of Article 14 of the Constitution of
India. The Full Bench decision was challenged before this Court
by filing a special leave petition which was dismissed. Thus, the
ratio laid down by the Full Bench judgment that any rule which
B excludes the counting of work-charged service of an employee
whose services have been regularised subsequently, must be held
to be bad in law was not disturbed by this Court. The distinction
made between an employee who was in temporary or officiating
service and who was in work-charged service as mentioned in
C Rule 3.17(ii) of the Punjab Civil Services Rules disappeared when
the said Rule was struck down by the Full Bench. The effect
was that an employee holding substantively a permanent post on
the date of his retirement was entitled to count in full as qualifying
service the periods of service in work-charged establishments.
D 26. In view of this settled position, there is no manner of doubt
that the work-charged service rendered by Respondent 1 under
the Government of Punjab was qualified for grant of pension un-
der the rules of the Government of Punjab and therefore, the
Board was not correct in rejecting the claim of the respondent
for inclusion of period of work-charged service rendered by him
E with the State Government for grant of pension, on the ground
that service rendered by him in the work-charged capacity out-
side PSEB and in the Departments of the State Government was
a non-pensionable service.
27. The apprehension that acceptance of the case of Respondent
F 1 would result into conferring a status on them as that of em-
ployees of the State of Punjab has no factual basis. It is true
that the State Government has power to frame rules governing
ser-vices of its employees under Article 309 of the Constitution
whereas the Board has power to prescribe conditions of service
by framing regulations under Section 79(c) of the Electricity
G (Supply) Act, 1948. However, governance of a particular institu-
tion and issuance of instructions to fill up the gap in the fields
where statutory provisions do not operate, is recognised as a valid
mode of administration in modern times.
40. So far as this argument is concerned, it is true that the Divi-
H sion Bench of the High Court has expressed the above opinion
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1095
[ARUN MISHRA, J.]
in the impugned judgment. However, the reference to Rule 3.17(ii) A
of the Punjab Civil Services Rules as well as the Full Bench de-
cision of the Punjab and Haryana High Court in Kesar Chand
v. State of Punjab (supra) and the speaking order dated 16-11-
2005 passed by the Board rejecting the claim of Respondent 1
makes it abundantly clear that the High Court has directed the
appel-lants to count the period of service rendered by Respondent B
1 in work-charged capacity with the State Government for
determin-ing qualifying service for the purpose of pension.
Further, Re-spondent 1 has been directed to deposit the amount
of Em-ployee's Contributory Fund which he had received from
the ap-pellants along with interest as per the directions of the C
Board be-fore the pension is released to him.”
(emphasis supplied)
20. In Habib Khan v. the State of Uttarakhand, (Civil Appeal
No.10806 of 2017), State Public Services Tribunal directed the counting
of the service rendered by a work-charged employee as ‘qualifying D
service’ for the pension. Writ Petition No.24 of 2007 was filed by the
State of Uttarakhand against the said order. The same was dismissed
by the High Court. Against the said order Special Leave to Appeal was
filed by the State which was also dismissed. Later on, the Full Bench
of the Uttarakhand High Court took the view that the period of work-
E
charged service cannot be counted for computation of the period of
‘qualifying service’. Based on Full Bench decision, review of the order
dismissing Writ Petition No.24 of 2007 was sought which was allowed
by order dated 27th July 2012 the same was questioned in this Court,
then the SLP was dismissed as withdrawn. Based on review petition,
the matter was re-heard and the High Court vide order dated 26 th May F
2015 has held that the work-charged service cannot be counted for
reckoning of the period of ‘qualifying service’. The decision of the Full
Bench of the Uttarakhand High Court passed after the grant of review
petition came up for consideration before this Court in Habib Khan v.
the State of Uttarakhand. Following order was passed by this Court
on 23.8.2017: G
“6. The pari materia provision contained in Rule 3.17(ii) of the
Punjab Civil Services Rules had been struck down by a Full
Bench decision of the Punjab and Haryana High Court in Kesar
Chand vs. State of Punjab and ors. (supra). The challenge by
the State against the aforesaid decision of the Full Bench of the H
1096 SUPREME COURT REPORTS [2019] 11 S.C.R.
A Punjab and Haryana High Court was negatived by this Court.
The matter came up for consideration before this Court, once
again, in the case of Punjab State Electricity Board and anr. Vs.
Narata Singh and anr. (2010) 4 SCC 317. While dealing with the
said question this Court in paragraph 25 of the report held that
the Full Bench decision of the Punjab and Haryana High Court
B was perfectly justified in striking down Rule 3.17(ii) of the Punjab
Civil Services Rules resulting in obliteration of the distinction made
in the said Rules between ‘temporary and officiating service’ and
‘work-charged service’. On the said basis, this Court took the
view that the period of work-charged service should be reckoned
C for purposes of computation of ‘qualifying service’ for grant of
pension.
7. As already observed, the provisions of Rule 370 of the Civil
Service Regulations applicable to the State of Uttarakhand are
pari materia with the provisions of Rule 3.17(ii) of the Punjab
D Civil Services Rules, discussed above. If that is so, ‘we do not
see as to why the period of service rendered on work-charged
ba-sis by the appellants should not be counted for purposes of
com-putation of ‘qualifying service’ for grant of pension. The
pari ma-teria provisions of Rule 3.17 (ii) of the Punjab Civil
E Services Rules having been interpreted and understood in the
above man-ner by this Court in Narata Singh (supra) we do not
find any room for taking any other view except to hold that the
appellants are entitled to reckon the period of work-charged
service for purposes of computation of ‘qualifying service’ for
grant of pen-sion. We order accordingly; allow these appeals and
F
set aside the impugned orders passed by the High Court.
8.All necessary and consequential benefit in terms of the present
order will be paid and granted by the State to the appellants
forthwith and without any delay.”
G 21. This Court ordered the counting of work-charged service
period towards qualifying service on the basis that pari materia
provision contained in Rule 3.17(ii) of the Punjab Civil Services Rules
has been struck down in Kesar Chand v. State of Punjab & Ors
(supra). This Court has also relied upon Punjab State Electricity
H Board v. Narata Singh & Anr. (supra) to grant the relief.
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1097
[ARUN MISHRA, J.]
22. Learned Advocate General appearing for the State of Uttar A
Pradesh has referred to the decision in Jaswant Singh & Ors. v.
Union of India & Ors. (1979) 4 SCC 440 to contend that work-charged
employee is the one who is engaged temporarily and their appointment
was made, from the very nature of their employment, till the completion
of the specified work. Work-charged employees are entitled to the
B
benefits of the provisions contained in the Industrial Disputes Act. This
Court also observed that they are in a better position than temporary
servants who are liable to be thrown out of employment without any
kind of compensatory benefits. The facts indicate that out of 36,000
work-charged employees of the Beas Project 26,000 had accepted
retrenchment compensation. Concerning the status of work-charged C
establishment and its employees this Court has observed thus:
“42. A work-charged establishment broadly means an establish-
ment of which the expenses, including the wages and allowances
of the staff, are chargeable to “works”. The pay and allowances
of employees who are borne on a work-charged establishment D
are generally shown as a separate sub-head of the estimated cost
of the works.
43. The entire strength of labour employed for the purpose of
the Beas Project was work-charged. The work-charged
employees are engaged on a temporary basis and their E
appointments are made for the execution of a specified work.
From the very nature of their employment, their services
automatically come to an end on the completion of the works
for the sole purpose of which they are employed. They do not
get any relief under the Payment of Gratuity Act nor do they
receive any retrenchment benefits or any benefits under the F
Employees State Insurance Schemes.
44. But though the work-charged employees are denied these
benefits, they are industrial workers and are entitled to the
benefits of the provisions contained in the Industrial Disputes Act.
Their rights flow from that special enactment under which G
even contracts of employment are open to adjustment and
modification. The work-charged employees, therefore, are in a
better position than temporary servants like the other petitioners
who are liable to be thrown out of employment without any kind
of com-pensatory benefits. H
1098 SUPREME COURT REPORTS [2019] 11 S.C.R.
A 49. We would like to say that in regard to the work-charged em-
ployees, it is high time that the Government framed specific rules
to govern their employment so as to dispel all doubts and
confusion.”
(emphasis supplied)
B 23. The question involved in the aforesaid matter was relating
to the workers working in the construction work of the Beas Project
in the power sector who were retrenched. They were appointed
temporarily and under the terms and conditions of their employment,
the services come to an end. This Court observed that employees could
C not claim the quasi-permanent status. Such temporary employees were
not entitled to that benefit. Once a settlement has been reached by the
work-charged employees they were bound by the settlement arrived.
24. In view of the observations made by this Court in Jaswant
Singh case (supra), it cannot be disputed that work-charged employees
D are appointed for a particular project and it was observed that their
status was better than temporary employees. Though they cannot claim
quasi-permanent status. At the same time, work-charged employees
could claim their benefits under the provisions of the Industrial Disputes
Act. This Court at the same time had observed that the time has come
that Government should frame specific rules concerning service
E conditions of work-charged employees to dispel all doubts and confusion.
The work-charged employees in the Jaswant Singh (supra) were
appointed for a particular project and thereafter on completion of the
same they were removed. The question involved in the present matters
is different, whether after regularization employees are entitled to count
their service. The question involved in Jaswant Singh (supra) was
F
different and no such rule like Rule 3(8) of Rules of 1961 was involved.
25. Learned Advocate General has relied upon the decision in
State of Rajasthan v. Kunji Raman (1997) 2 SCC 517 in which this
Court considered the concept of equal pay for equal work. This Court
held that the concept of equal pay for equal work did not apply to work-
G
charged employee vis-à-vis to the regular employee of PWD, they
form two separate and distinct classes. This Court held that framing
of the separate rules for a work-charged employee by excluding them
from the general rules applicable to an employee of the regular
establishment was not arbitrary or discriminatory. The rules framed by
H the State of Rajasthan came up for consideration. In that context, this
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1099
[ARUN MISHRA, J.]
Court has pointed out the distinction in the work-charged establishment A
and regular establishment. The work-charged employees were denied
Project Allowance and Leave Encashment Allowance on the ground
that Rajasthan Services Rules, 1951 and Rajasthan Service
(Concessions on Project) Rules, 1962 did not apply to them. The High
Court rejected the submission that the payment of compensatory
allowance to the employees is contrary to the principles of consideration B
or equal pay for equal work. It upheld the validity of rule (g), (h) and
(i) for Rajasthan Service Rules, 1951 and held that work-charged
employees are entitled to project allowance at the same rate as it was
being paid to employees of the regular establishment. The High Court
struck down Rules 2 (b) and (d) of Project Rules, 1962 and Rules C
4(2)(4) of Project Rules, 1975 as violative of Articles 14 and 16 of the
Constitution. This Court referred to the decision of the Jaswant Singh
(supra) and has followed the same. This Court observed thus:
“6. A work-charged establishment as pointed out by this Court
in Jaswant Singh v. Union of India (1979) 4 SCC 440 broadly D
means an establishment of which the expenses, including the
wages and allowances of the staff, are chargeable to “works”.
The pay and allowances of employees who are borne on a work-
charged establishment are generally shown as a separate sub-
head of the estimated cost of the works. The work-charged
employees are engaged on a temporary basis and their E
appointments are made for the execution of a specified work.
From the very nature of their employment, their services
automatically come to an end on the completion of the works
for the sole purpose of which they are employed. Thus, a work-
charged establishment is materially and qualitatively different from
F
a regular establishment.
7. In the State of Rajasthan, the Public Works Department is
maintaining two separate establishments: (1) Regular and (2)
Work-charged. The employees working in the regular establish-
ment are governed by the RSR and the work-charged employees
G
are governed by the Work-charged Employees Service Rules.
The RSR are made inapplicable, inter alia, to the work-charged
employees. The work-charged employees fall under two catego-
ries: (1) those who are working on a project and (2) those who
are not working on a project. It appears that for the workmen
en-gaged in the work-charged establishment of Mahi Bajaj Sagar H
1100 SUPREME COURT REPORTS [2019] 11 S.C.R.
A Project the Government has framed separate standing orders un-
der the Industrial Employment (Standing Orders) Act, 1946 and
they apply to all persons engaged in work-charged establishment
of the said Project whose terms of service are not regulated by
the RSR, Rajasthan Civil Service (Classification, Control, and
Appeal) Rules and any other Rules framed under Article 309 of
B the Constitution by the Government of Rajasthan. The standing
orders provide not only for classification, recruitment, and ter-
mination of service but also for wages and allowances and other
service conditions of the persons engaged in the Mahi Project.
Whereas the employees who are not working on a project get
C work-charged pay scale those who are working on a project get
a special pay scale and they are also entitled to other benefits
and allowances as are applicable to all the employees covered
under the Industrial Disputes Act, 1947, Factories Act, 1948 and
Indus-trial Employment (Standing Orders) Act, 1946. The
petitioner and other employees represented by him are
D undisputably gov-erned by the said certified standing orders. They
are not treated as full-time government employees and, therefore,
are free to utilise their free time in the manner they wish. They
are also enti-tled to grant of overtime wages. A sub-division is
regarded as a unit for the purpose of establishment of the work-
E charged em-ployees. A separate seniority list of each category
is maintained in each unit for the purpose of promotion as well
as retrench-ment. The service of a work-charged employee is
ordinarily not transferable from one work-charged establishment
to another work-charged establishment."
(emphasis supplied)
F
This Court has reiterated that from the very nature of the work-
charged employee their services automatically comes to an end on
completion of the work for the sole purpose for which they are
employed. The services are not ordinarily transferable; thus, it is
different from a regular establishment.
G
26. Learned Advocate General has also referred to the decision
in Punjab State Electricity Board v. Jagjiwan Ram (2009) 3 SCC
661, wherein the question arose granting the benefit of time-bound
promotion scales/ increments which was available in case the incumbent
has rendered service in the regular establishment. This Court observed
H that regular service means services rendered after the regular
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1101
[ARUN MISHRA, J.]
appointment and therefore does not include service rendered under A
ad-hoc, temporary or work-charged employees. Therefore, the
work-charged employees could not have been granted the benefit of
time-bound advancement of the pay scales unless they complete the
prescribed period of service as regular employees. This Court again
considered the distinction between work-charged employees and regular
B
employees and observed that the sources and mode of engagement of
employees are different. Their pay and conditions of employment are
also different. The work-charged employees cannot be treated at par
with regular employees. They cannot claim regularization as a right.
However, they can claim protection under the Industrial Disputes Act.
The Office Order dated 23.4.1990 came for consideration which made C
the “Time Bound benefit of Promotional Scale” available to a person
having rendered regular service. It cannot be doubted that work-
charged, as well as regular establishments, are different. Their mode
of recruitment is also different. This Court has also observed that if
the service of a work-charged employee is regularized by any instruction
D
or under any scheme then he becomes a member of regular
establishment from the date of regularization. The service in the work-
charged establishment cannot be clubbed with the service of regular
establishment unless a specific provision to that effect is made either
in the statute or in the scheme of regularization. If under any regulation/
rule or the scheme, the services of the work-charged employees are E
regularized the work-charged employees cannot claim benefit for fixation
of seniority in the regular cadre. This Court in Jagjiwan Ram (supra)
has observed thus:
“9. We have considered the respective submissions. Generally
speaking, a work-charged establishment is an establishment of F
which the expenses are chargeable to works. The pay and
allowances of the employees who are engaged in a work-charged
establishment are usually shown under a specified sub-head of
the estimated cost of works. The work-charged employees are
engaged for execution of specified work or project and their
engagement comes to an end on completion of the work or G
project. The source and mode of engagement/recruitment of
work-charged employees, their pay and conditions of employment
are altogether different from the persons appointed in the regular
establishment against sanctioned posts after following the
procedure prescribed under the relevant Act or rules and their H
1102 SUPREME COURT REPORTS [2019] 11 S.C.R.
A duties and responsibilities are also substantially different than
those of regular employees.
10. The work-charged employees can claim protection under the
Industrial Disputes Act or the rights flowing from any particular
statute but they cannot be treated on a par with the employees
B of regular establishment. They can neither claim regularisation
of service as of right nor can they claim pay scales and other
finan-cial benefits on a par with regular employees. If the service
of a work-charged employee is regularised under any statute or
a scheme framed by the employer, then he becomes a member
of regular establishment from the date of regularisation. His
C service in the work-charged establishment cannot be clubbed with
ser-vice in a regular establishment unless a specific provision to
that effect is made either in the relevant statute or the scheme
of regularisation. In other words, if the statute or scheme under
which service of work-charged employee is regularised does not
D provide for counting of past service, the work-charged employee
cannot claim benefit of such service for the purpose of fixation
of seniority in the regular cadre, promotion to the higher posts,
fixation of pay in the higher scales, grant of increments, etc.
13. After noticing the earlier judgment in Jaswant Singh
case, the Court held: (Kunji Raman case, SCC pp. 521-23, paras
E
8-10)
“8. A work-charged establishment thus differs from a regular
establishment which is permanent in nature. Setting up and
continuance of a work-charged establishment is dependent
upon the Government undertaking a project or a scheme or a
F 'work' and availability of funds for executing it. So far as
employees engaged in work-charged establishments are
concerned, not only their recruitment and service conditions
but the nature of work and duties to be performed by them
are not the same as those of the employees of the regular
G establishment. A regular establishment and a work-charged
establishment are two separate types of establishments and
the persons employed in those establishments thus form two
separate and distinct classes. For that reason, if a separate
set of rules are framed for the persons engaged in the work-
charged establishment and the general rules applicable to
H persons working on the regular establishment are not made
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1103
[ARUN MISHRA, J.]
applicable to them, it cannot be said that they are treated in A
an arbitrary and discriminatory manner by the Government.
It is well settled that the Government has the power to frame
different rules for different classes of employees. We,
therefore, reject the contention raised on behalf of the
appellant in Civil Appeal No. 653 of 1993 that clauses (g),
(h) and (i) of Rule 2 of the Rajasthan Service Rules are B
violative of Articles 14 and 16 of the Constitution and uphold
the view taken by the High Court.
14. The ratio of the abovementioned judgments is that work-
charged employees constitute a distinct class and they cannot
be equated with any other category or class of employees much C
less regular employees and further that the work-charged
employees are not entitled to the service benefits which are
admissible to regular employees under the relevant rules or policy
framed by the employer.
20. A reading of the scheme framed by the Board makes it clear D
that the benefit of time-bound promotional scales was to be given
to the employees only on their completing 9/16 years’ regular
service. Likewise, the benefit of promotional increments could
be given only on completion of 23 years' regular service. The
use of the term “regular service” in various paragraphs of the E
scheme shows that service rendered by an employee after
regular appointment could only be counted for computation of 9/
16/23 years’ service and the service of a temporary, ad hoc or
work-charged employee cannot be counted for extending the
benefit of time-bound promotional scales or promotional incre-
F
ments. If the Board intended that total service rendered by the
employees irrespective of their mode of recruitment and status
should be counted for grant of time-bound promotional scales or
promotional increments, then instead of using the expression “9/
16 years’ regular service” or “23 years’ regular service, the
authority concerned would have used the expression "9/16 years' G
service" or "23 years' service”. However, the fact of the matter
is that the scheme in its plainest term embodies the requirement
of 9/16 years’ regular service or 23 years’ regular service as a
con-dition for grant of time-bound promotional scales or
promotional increments as the case may be.” H
1104 SUPREME COURT REPORTS [2019] 11 S.C.R.
A 27. It is apparent from the aforesaid discussion that it would
depend upon the service rules or schemes whether the period of work-
charged service has to be counted for ACP, in case provision has been
made under a particular statute, rule or scheme, service rendered as
work-charged employees can be counted. It would depend upon the
relevant provision of which benefit is claimed. Again, this Court has
B emphasized that by its very nature of employment work-charged
employees have not to continue for long, employment comes to an end
with the project.
28. The submission has been urged on behalf of the State of Uttar
Pradesh to differentiate the case between work-charged employees and
C regular employees on the ground that due procedure is not followed
for appointment of work charged employees, they do not have that much
work pressure, they are unequal and cannot be treated equally, work-
charged employees form a totally different class, their work is materially
and qualitatively different, there cannot be any clubbing of the services
D of the work-charged employees with the regular service and vice versa,
if a work-charged employee is treated as in the regular service it will
dilute the basic concept of giving incentive and reward to a permanent
and responsible regular employee.
29. We are not impressed by the aforesaid submissions. The
E appointment of the work-charged employee in question had been made
on monthly salary and they were required to cross the efficiency bar
also. How their services are qualitatively different from regular
employees? No material indicating qualitative difference has been
pointed out except making bald statement. The appointment was not
made for a particular project which is the basic concept of the work
F charged employees. Rather, the very concept of work-charged
employment has been misused by offering the employment on
exploitative terms for the work which is regular and perennial in nature.
The work-charged employees had been subjected to transfer from one
place to another like regular employees as apparent from documents
placed on record. In Narain Dutt Sharma & Ors. v. State of Uttar
G
Pradesh & Ors. (CA No.______2019 @ SLP (C) No.5775 of 2018)
the appellants were allowed to cross efficiency bar, after ‘8’ years of
continuous service, even during the period of work-charged services.
Narain Dutt Sharma, the appellant, was appointed as a work-charged
employee as Gej Mapak w.e.f 15.9.1978. Payment used to be made
H monthly but the appointment was made in the pay scale of Rs.200-320.
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1105
[ARUN MISHRA, J.]
Initially, he was appointed in the year 1978 on a fixed monthly salary A
of Rs.205 per month. They were allowed to cross efficiency bar also
as the benefit of pay scale was granted to them during the period they
served as work-charged employees they served for three to four
decades and later on services have been regularized time to time by
different orders. However, the services of some of the appellants in
few petitions/ appeals have not been regularized even though they had B
served for several decades and ultimately reached the age of
superannuation.
30. In the aforesaid facts and circumstances, it was unfair on
the part of the State Government and its officials to take work from
the employees on the work-charged basis. They ought to have resorted C
to an appointment on regular basis. The taking of work on the work-
charged basis for long amounts to adopting the exploitative device. Later
on, though their services have been regularized. However, the period
spent by them in the work-charged establishment has not been counted
towards the qualifying service. Thus, they have not only been deprived D
of their due emoluments during the period they served on less salary in
work charged establishment but have also been deprived of counting
of the period for pensionary benefits as if no services had been rendered
by them. The State has been benefitted by the services rendered by
them in the heydays of their life on less salary in work-charged
establishment. E
31. In view of the note appended to Rule 3(8) of the 1961 Rules,
there is a provision to count service spent on work charged,
contingencies or non pensionable service, in case, a person has rendered
such service in a given between period of two temporary appointments
in the pensionable establishment or has rendered such service in the F
interregnum two periods of temporary and permanent employment. The
work-charged service can be counted as qualifying service for pension
in the aforesaid exigencies.
32. The question arises whether the imposition of rider that such
service to be counted has to be rendered in-between two spells of
G
temporary or temporary and permanent service is legal and proper. We
find that once regularization had been made on vacant posts, though
the employee had not served prior to that on temporary basis,
considering the nature of appointment, though it was not a regular
appointment it was made on monthly salary and thereafter in the pay
scale of work-charged establishment the efficiency bar was permitted H
1106 SUPREME COURT REPORTS [2019] 11 S.C.R.
A to be crossed. It would be highly discriminatory and irrational because
of the rider contained in Note to Rule 3(8) of 1961 Rules, not to count
such service particularly, when it can be counted, in case such service
is sandwiched between two temporary or in-between temporary and
permanent services. There is no rhyme or reason not to count the
service of work-charged period in case it has been rendered before
B regularisation. In our opinion, an impermissible classification has been
made under Rule 3(8). It would be highly unjust, impermissible and
irrational to deprive such employees benefit of the qualifying service.
Service of work-charged period remains the same for all the employees,
once it is to be counted for one class, it has to be counted for all to
C prevent discrimination. The classification cannot be done on the
irrational basis and when respondents are themselves counting period
spent in such service, it would be highly discriminatory not to count the
service on the basis of flimsy classification. The rider put on that work-
charged service should have preceded by temporary capacity is
discriminatory and irrational and creates an impermissible classification.
D
33. As it would be unjust, illegal and impermissible to make
aforesaid classification to make the Rule 3(8) valid and non
discriminatory, we have to read down the provisions of Rule 3(8) and
hold that services rendered even prior to regularisation in the capacity
of work-charged employees, contingency paid fund employees or non-
E pensionable establishment shall also be counted towards the qualifying
service even if such service is not preceded by temporary or regular
appointment in a pensionable establishment.
34. In view of the note appended to Rule 3(8), which we have
read down, the provision contained in Regulation 370 of the Civil
F Services Regulations has to be struck down as also the instructions
contained in Para 669 of the Financial Handbook.
35. There are some of the employees who have not been
regularized in spite of having rendered the services for 30-40 or more
years whereas they have been superannuated. As they have worked
G in the work-charged establishment, not against any particular project,
their services ought to have been regularized under the Government
instructions and even as per the decision of this Court in Secretary,
State of Karnataka & Ors. v. Uma Devi 2006 (4) SCC 1. This Court
in the said decision has laid down that in case services have been
rendered for more than ten years without the cover of the Court's order,
H as one time measure, the services be regularized of such employees.
PREM SINGH v. STATE OF UTTAR PRADESH & ORS. 1107
[ARUN MISHRA, J.]
In the facts of the case, those employees who have worked for ten A
years or more should have been regularized. It would not be proper to
regulate them for consideration of regularisation as others have been
regularised, we direct that their services be treated as a regular one.
However, it is made clear that they shall not be entitled to claiming any
dues of difference in wages had they been continued in service regularly
before attaining the age of superannuation. They shall be entitled to B
receive the pension as if they have retired from the regular
establishment and the services rendered by them right from the day
they entered the work-charged establishment shall be counted as
qualifying service for purpose of pension.
36. In view of reading down Rule 3(8) of the U.P. Retirement C
Benefits Rules, 1961, we hold that services rendered in the work-
charged establishment shall be treated as qualifying service under the
aforesaid rule for grant of pension. The arrears of pension shall be
confined to three years only before the date of the order. Let the
admissible benefits be paid accordingly within three months. D
Resultantly, the appeals filed by the employees are allowed and filed
by the State are dismissed.
37. All pending interlocutory applications and miscellaneous
applications, if any, are disposed of.
E
Kalpana K. Tripathy Appeals disposed of
F
G
H
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