Protection for Pensionary benefits when recasting seniority after retirement

Pensionary benefits when recasting seniority after retirement : The pensionary benefits which are being disbursed to the appellants shall not be disturbed. Likewise, the pensionary payments which are being disbursed to the respondents shall be paid over in accordance with law- Honourable Supreme Court

Pensionary benefits when recasting seniority after retirement – Judgement

Reportable

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

Civil Appeal Nos 6026-6028 of 2021
(Arising out of SLP (C) Nos 14029-14031 of 2011)

Malook Singh and Others …Appellants

Versus

State of Punjab and Others …Respondents

WITH
Civil Appeal No 6024 of 2021
(Arising out of SLP (C) No 25310 of 2013)

AND WITH
Civil Appeal No 6025 of 2021
(Arising out of SLP (C) No 22674 of 2012)

J U D G M E N T

Dr Dhananjaya Y Chandrachud

1. Leave granted.
2. This batch of appeals arises from a judgment and order dated 15 March 2011 of a Division Bench of the High Court of Punjab and Haryana.

3. For convenience of reference, the facts as they emerged in the lead Civil Appeal (CA 6026-6028/2021 @ SLP(C) 14029-14031/2011) may be set out.
4. The appellants were appointed as clerks in 1975-1976 in the Punjab Civil Secretariat on an ad hoc basis. On 3 May 1977, their services were regularized with effect from 1 April 1977 pursuant to a policy of regularization. The policy of regularization notes that in anticipation of regular appointments, ad hoc appointments were resorted to by various appointing authorities in “administrative interest” after notifying the vacancies to the employment exchange or, as the case may be, by issuing advertisements. Since the ad hoc employees had acquired experience, and their ouster after a considerable period of service would entail hardship, their services were regularized, subject to certain terms and conditions. Clause (5) of the policy on regularization contained the following stipulations:

“5. The seniority of the ad hoc employees whose appointments are regularized in terms of the above policy shall be determined in the following manner:-

(a) After approval by the Appointing Authority the regularization of their appointments shall date back to 1st April, 1977 from which date their seniority shall be determined vis-à-vis candidates appointed on regular basis after selection through the prescribed agencies;

(b) The service rendered on ad hoc basis shall be taken into account for purposes of determining inter se seniority among the ad hoc employees themselves and a person having a longer service shall be senior and if the date of appointment on ad hoc basis is the same, then the older member shall be senior to a younger member.”

5. From the above stipulations, it becomes evident that the regularization in terms of the policy dated 3 May 1977, was to become effective on 1 April 1977 from which date their seniority would be determined in relation to candidates who were appointed on a regular basis after following the normal procedures for selection. However, as between the ad hoc employees who were regularized, it was stipulated that service rendered on an ad hoc basis shall be taken into account so that a person having a longer service shall be senior and if the date of appointment on ad hoc basis was the same, the older member would rank senior to the younger

6. A batch of seventy-three clerks, including the appellants, who were working in the office of the Punjab Civil Secretariat instituted a writ petition2 under Article 226 to challenge the seniority position as it stood on 31 December 1978 (Malook Singh v State of Punjab). Besides the official respondents, twenty-seven private respondents were impleaded as parties to the writ petition. These respondents, it must be noted, were regularly appointed candidates who had been appointed after 1 April 1977. The petitioners in those proceedings claimed the benefit of ad hoc service rendered by them towards their seniority as against regularly recruited clerks appointed after them. By a judgment and order dated 6 December 1991, a Single Judge of the High Court observed that in terms of Rule 9 of the Punjab Civil Secretariat (State Service Class III) Rules 1976, the seniority inter se of members of a service in each cadre would be determined by the length of continuous service on a post in the cadre of service. The Single Judge held that while the petitioners before the High Court had been regularized from 1 April 1977, the private respondents were appointed subsequently. As a consequence, those who were appointed subsequently could not claim seniority over those who were regularized prior to their appointment. Besides the above finding, Single Judge held that in view of the decision of this Court in Direct Recruit Class II Engineering Officers’ Association v. State of Maharashtra, once the services had been regularized they would relate back to the date of their initial appointment and the ad hoc service would have to be kept in view in determining seniority and other benefits. The petition was allowed in the above terms.
7. The judgment of the Single Judge was carried in a Letters Patent Appeal by the State of Punjab. The Division Bench, by its judgement dated 4 January 1993, held that the Single Judge was justified in coming to the conclusion that persons who had been regularized with effect from 1 April 1977 would rank senior to those who had been
   recruited after their date of regularization and to that extent the petitioners before the Single Judge had been correctly held to be senior to the private respondents. Having held this, the Division Bench however clarified that it was expressing no opinion on the second aspect which was adverted to by the Single Judge namely, that upon regularization, the services of the petitioners for the purpose of seniority would relate back to the date of their initial appointment. This question was left open to be dealt in an appropriate case with a clarification that the judgment of the Single Judge would not be treated as a binding precedent.
8. The Special Leave Petition4 against the judgment of the Division Bench was dismissed by this Court on 16 July 1993. Contempt petitions were filed before the High
   Court for non-compliance of the judgment of the Single Judge dated 6 December 1991. During the pendency of the contempt petitions, the seniority list was redrawn and finalized by an Office Order dated 14 January 1994. According to the seniority list, the appellants to these proceedings were granted seniority with effect from their dates of initial appointment by including the period of ad hoc service. The contempt petitions were disposed of by the High Court by its order dated 12 August 1994.
9. A batch of writ petitions5 was instituted before the High Court to challenge the fixation of seniority. The persons who instituted these petitions had a grievance that the fixation of seniority had been made without affording a hearing to them and that the judgment of the High Court dated 6 January 1991 would not bind them since they were not parties to the earlier writ petition6.The State of Punjab contested the proceedings.The Single Judge, by an order dated 5 January 2011, allowed the writ petitions which were instituted by the private respondents. The Single Judge came to the conclusion that the judgment in CWP No 2780 of 1980 (Malook Singh v. State of Punjab) had been overruled by a Division Bench of the High Court in Gurmail Singh v. State of Punjab7.The Single Judge also noted that another writ petition8 was filed before the High Court, which was allowed by a Single Judge of the High Court on 24 December 1997, on the basis of the decision in Malook Singh’s case. Against the said judgment, a Letters Patent Appeal9 was preferred, which was allowed on 8 January 1999, adverting to the fact that in Gurmail Singh’s case, the decision in Malook Singh had been overruled. Moreover, it was also observed that in the Letters Patent Appeal, which was filed before the Division Bench in Malook Singh’s case, it was specifically observed that the judgment of the Single Judge would not be cited as a precedent to determine whether ad hoc service would be reckonable for the purpose of seniority. Against the judgement of the Division Bench of the High Court, Special Leave Petitions10 were filed before this Court which were dismissed in limine on 19 July 1999. After adverting to these developments, the Single Judge came to the conclusion that it was a well settled principle that where the initial appointment is made without following due procedure in accordance with the mandate of Articles 14 and 16, ad hoc service would not count for the determination of seniority. The Single Judge held that the decision in Malook Singh’s case having attained finality would bind the State, the petitioners and the private respondents who were parties to that proceeding. The rights of parties which were determined by a conclusive judgment could not be thus reopened as between the parties to that proceeding. Consequently, the Single Judge held that as between the parties to the decision in Malook Singh’s case, the judgment would be treated as final and binding. On the other hand, the persons who were appointed by a due process of selection and were not parties to the earlier proceedings in Malook Singh’s case would not be bound by the decision.
10. Following the judgement of the Single Judge, Letters Patent Appeals11 were carried to the Division Bench. The Division Bench by its judgment and order dated 15 March 2011, dismissed the Letters Patent Appeals. The Division Bench has held that ad hoc service followed by regularization would not qualify for the purpose of fixing seniority in view of the law settled by the Supreme Court. At the same time, the judgment in Malook Singh’s case would nonetheless enure to the benefit of those who were parties to the proceedings but would not adversely affect the rights of others who were not parties to the proceedings. The judgment of the Division Bench has given rise to the present appeal

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