Writ Petition No.1814 of 1998,Writ Petition No.4022 of 1998,Writ Petition No.4156 of 1999

8th June, 2009

Petitioner Counsel: Shri. A. S. JAISWAL,Shri. U. S. DASTANE,Ms. GEETA BAMLANI,Shri. U. S. DASTANE,Ms. GEETA BAMLANI
Respondent Counsel: Shri. U. S. DASTANE,Ms. GEETA BAMLANI,Shri. ANOOP PARIHAR,Shri. ANOOP PARIHAR,Shri. A. S. JAISWAL,Shri. D. V. SIRAS,Shri. A. R. PATIL,Shri. ANOOP PARIHAR

Cases Cited:
Agricultural Produce Market Committee Vs. Ashok Harikuni, (2000)8 SCC 61 [Para 8]
Corporation of the City of Nagpur Vs. Employees, AIR 1960 SC 675 [Para 8]
D. N. Banerji Vs. P. R. Mukherjee, AIR 1953 SC 58 [Para 8]
State of Bombay Vs. Hospital Mazdoor Sabha, AIR 1960 SC 610 [Para 8]
Chief Conservator of Forests Vs. Jagannath Maruti Kondhare, (1996)2 SCC 293 [Para 8,9]
Bangalore Water Supply & Sewerage Board Vs. A. Rajappa, (1978)2 SCC 213 [Para 8]
State of Manipur Vs. Y. Token Singh, 2007(6) ALL MR 439 (S.C.)=(2007)5 SCC 65 [Para 12]
State of U.P. Vs. Desh Raj, 2006 ALL MR (Cri) 2387 (S.C.)=(2007)1 SCC 257 [Para 12]
Secretary, State of Karnataka Vs. Umadevi, (3), (2006)4 SCC 1 : 2008 ALL SCR 134 [Para 12,36]
Municipal Corporation, Jabalpur Vs. Om Prakash Dubey, (2007)1 SCC 373 [Para 14]
State of M.P. Vs. Lalit Kumar Verma, (2007)1 SCC 575 [Para 15]
National Fertilizers Ltd. Vs. Somvir Singh, (2006)5 SCC 493 [Para 17,21]
Mahendra L. Jain Vs. Indore Development Authority, (2005)1 SCC 639 [Para 18]
State of U.P. Vs. Neeraj Awasthi, (2006)1 SCC 667 [Para 19]
Accounts Officer (A&I) A.P.S.R.T.C. Vs. P. Chandra Sekhara Road, (2006)7 SCC 488 [Para 20]
A. Umarani Vs. Registrar, Co-operative Societies, (2004)7 SCC 112 [Para 22]
State of Uttaranchal Vs. Prantiya Sinchai Avam Bandh Yogana Shramik Mahaparishad, 2007 ALL SCR 2648 : (2007)12 SCC 483 [Para 23]
Haryana State Electronics Development Corporation Ltd. Vs. Mamni, (2006)9 SCC 434 [Para 24]
Waman Shriniwas Kini Vs. Ratilal Bhagwandas and Co., 1959 Supp (2) SCR 217 [Para 27]
Jodhpur Vidyut Vitran Nigam Ltd. Vs. Nanu Ram, (2006)12 SCC 494 [Para 31]
Life Insurance Corporation of India Vs. Asha Ramchandra Ambekar (Mrs), (1994)2 SCC 718 [Para 33]
Indian Drugs & Pharmaceuticals Ltd. Vs. Workmen, Indian Drugs & Pharmaceuticals Ltd., (2007)1 SCC 408 [Para 34]
Ashwani Kumar Vs. State of Bihar, (1997)2 SCC 1 [Para 36]
State of Haryana Vs. Piara Singh, (1992)4 SCC 118 [Para 36]
Dharwad Distt. PWD Literate Daily Wage Employees Assn. Vs. State of Karnataka, (1990)2 SCC 396 [Para 36]
B. N. Nagarajan Vs. State of Karnataka, (1979)4 SCC 507 [Para 36]

JUDGMENT

JUDGMENT :- Writ Petition No.1814 of 1998 by workmen and Writ Petition No.4022 of 1998 by employer are directed against order passed on 23-1-1998 in ULPA Complaint No.1646 of 1991 by the learned Member, Industrial Court, Nagpur, whereby he held the employer guilty of unfair labour practice as defined in item 6 of Schedule IV of MRTU & PULP Act, and directed the employer to give benefits of regularization and permanency as Gatemen to complainant-workmen at Sr. Nos.1 to 15 and 18 to 20 from the date of complaint, i.e. 17-12-1991. By the said order, he also directed that benefit of regularization and permanency as Driver be given to workman at Sr. No.16 in the complaint from the date of complaint to 8-7-1995 (when he was dismissed on a ground unconnected with the lis). Workman at Sr. No.17 in the complaint was directed to be given similar benefit of regularization as Gateman from the date of complaint till his appointment as Typist. Employer is aggrieved because workmen were granted these benefits and workmen are aggrieved by the order because it gives them the benefits from the date of complaint as against their claim for regularization from the day the concerned workman completed 240 days of continuous service.

2. Writ Petition No.4156 of 1999 by the employer is directed against a similar order passed on 24-8-1999 by the learned Member, Industrial Court, directing regularization of workman therein on the permanent post of Gateman from 17-12-1989, the date on which posts were sanctioned.

3. Facts, which are material for deciding these petitions, are as under :

4. After considering voluminous oral and documentary evidence tendered before him in the first complaint, the learned Member, Industrial Court, held that the workmen had not proved that they were appointed as Clerks or were performing the duties of Clerks. He, therefore, held most of them entitled to regularization as Gatemen from the dates of their complaints. Similar findings were recorded in complaint of Kamnath Falke, who was ordered to be regularized with effect from 17-12-1989.

5. The learned counsel for the parties, in their painstakingly articulated arguments, unfolded fairly all aspects of the controversy.

6. The learned counsel for the APMC submitted that regularization after 240 days of service cannot be claimed as a right for a number of reasons like (a) the APMC is State for the purposes of Article 12 of the Constitution and, therefore, appointments to the posts under APMC would be subject to compliance to Articles 14 and 16 of the Constitution; (b) the APMC, as a body discharging sovereign or regulatory functions, is not an industry and, therefore, its workmen may not be governed by industrial law as to regularization, but would be governed by APMC's own rules; (c) the APMC rules laid down a procedure for not only creating the posts, but also for the manner in which such posts could be filled in and this procedure is not shown to have been followed; (d) the respondent-workmen were appointed to posts, which were not sanctioned and, therefore, their entry itself was not legal, disentitling them to regularization in the light of pronouncement of the Constitution Bench of the Apex Court in Umadevi; and (e) though it is neither necessary nor permissible, the APMC did offer regularization to the respondents and actually regularized their services and thus there is no unfair labour practice. Since the APMC was not under any obligation to regularize services of the workmen, the Industrial Court could not have ordered regularization from the date the posts were created or in one case, the date of complaints.

7. The learned counsel for the workmen contested these propositions. As far as the position that APMC is State for the purpose of Article 12 of the Constitution, there need not be any serious dispute and, therefore, the appointments to the posts under APMC would be subject to compliance to Articles 14 and 16 of the Constitution.

8. Advocate Shri. Jaiswal relied on a judgment of the Supreme Court in Agricultural Produce Market Committee Vs. Ashok Harikuni and another, reported at (2000)8 SCC 61, where the Supreme Court considered applicability of the provisions of Industrial Disputes Act to statutory corporations, functionaries whereof were creatures of the statute. The Court was considering the definition of "industry" in the light of the question whether Agriculture Produce Market Committee under the Karnataka Agricultural Produce Marketing (Regulation) Act is an "industry" and if yes, whether an employee of such Committee would be governed by the Central Act, i.e. the Industrial Disputes Act. The structure of Market Committees in Karnataka and Maharashtra is similar. The Court was considering the cases of employees, who were temporarily appointed and had not yet become Government servants. On behalf of the Committee, an attempt was made to bring the functions of the Committee within sovereign functions of the Government. Relying on the judgments in Corporation of the City of Nagpur Vs. Employees, reported at AIR 1960 SC 675; D. N. Banerji Vs. P. R. Mukherjee, reported at AIR 1953 SC 58; State of Bombay Vs. Hospital Mazdoor Sabha, reported at AIR 1960 SC 610; Chief Conservator of Forests Vs. Jagannath Maruti Kondhare, reported at (1996)2 SCC 293; and of course, Bangalore Water Supply & Sewerage Board Vs. A. Rajappa, reported at (1978)2 SCC 213, the Court held in para 21 of the judgment as under :

"21. In other words, it all depends on the nature of power and the manner of its exercise. What is approved to be "sovereign" is defence of the country, raising armed forces, making peace or war, foreign affairs, power to acquire and retain territory. These are not amenable to the jurisdiction of ordinary civil courts. The other functions of the State including welfare activity of State could not be construed as "sovereign" exercise of power. Hence, every governmental functions need not be "sovereign". State activities are multifarious, from the primal sovereign power, which exclusively inalienably could be exercised by the sovereign alone, which is not subject to challenge in any civil court to all the welfare activities, which would be undertaken by any private person. So merely if one is an employee of statutory bodies would not take it outside the Central Act. If that be so then Section 2(a) of the Central Act read with Schedule I gives large number of statutory bodies which should have been excluded, which is not. Even if a statute confers on any statutory body, any function which could be construed to be "sovereign" in nature would not mean every other functions under the same statute to be also sovereign. The court should examine the statute to sever one from the other by comprehensively examining various provisions of that statute. In interpreting any statute to find if it is "industry" or not we have to find its pith and substance. The Central Act is enacted to maintain harmony between employer and employee which brings peace and amity in its functioning. This peace and amity should be the objective in the functioning of all enterprises. This is to the benefit of both the employer and employee. Misuse of rights and obligations by either or stretching it beyond permissible limits have to be dealt with within the framework of the law but endeavour should not be in all circumstances to exclude any enterprise from its ambit. That is why courts have been defining "industry" in the widest permissible limits and "sovereign" functioning within its limited orbit."

The Court then examined the constitution of Market Committees under the Karnataka Act and its powers and functions, and held in para 27 that though various functionaries under the Act are creatures of statute, such creation by itself cannot confer on it the status of performing inalienable functions of the State. In para 28, the Court observed that merely because an enterprise is a creature under a statute, it does not come outside the ambit of "industry" as defined under the Central Act. Testing the dominant object as laid down in Bangalore Water Supply and Sewerage Board case, the Court reached to inescapable conclusion that none of the activities of the Agriculture Produce Market Committee could be construed to be sovereign in nature and, therefore, held that it would fall under the definition of "industry".

9. In Chief Conservator of Forest Vs. Jaganath Maruti Kondhare, reported at (1996)2 SCC 293, relied on by Advocate Jaiswal the Court considered applicability of industrial law to activities by State, in the light of the declaration of law in Bangalore Water Supply and Sewerage Board that sovereign functions "strictly understood" alone qualify for exemption. The Court did not agree that all welfare activities of the State would be included in sovereign functions. The Court concluded on facts that the scheme in question could not be regarded as inalienable or inescapable function of the State.

10. In this context it is humbly submitted that crux of the problem may not even be regal/non-regal or sovereign/ non-sovereign functions. While exercising regal or sovereign functions, the State may be discharging the duties as the sovereign, but certainly not at the cost of a labourer. If say labourers are engaged in removing a road-blockage, could they be denied minimum wage, or humane conditions of work, like not more than eight hours of work, or right to compensation, should they suffer an injury ? For the labourer the function is merely removing debris. For him whether it is debris of a road blockade or a wall collapse, makes hardly any difference. If governance were to be carried out at the cost of a poor labourer, it will run into conflict with other welfare functions expected of the State by Part-IV of the Constitution, namely that citizens have adequate means of livelihood, that health and strength of workers are not abused (Article 39), securing humane conditions of work (Article 42), a living wage, conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and cultural opportunities (Article 42).

11. In view of this, it will not be possible to hold that the respondent-workmen would not be governed by the industrial law. It has, however, borne in mind that the claim of APMC to be State under Article 12 has two dimensions. First is whether it performs sovereign functions and, therefore, is not amenable to industrial law. This has already been answered by the Apex Court in the case of Agriculture Produce Market Committees of Karnataka State, which have been created under a statute similar to that applicable to the petitioner Agriculture Produce Market Committee in Maharashtra. The other dimensions, namely being State, whether the services under the Committee are subject to compliance to Articles 14 and 16 of the Constitution would, however, be still valid. It would not be permissible to conclude that the requirements of public employment, by giving an opportunity to all eligible aspirants, could be done away with.

12. The learned counsel for APMC submitted that the appointments made without following constitutional scheme under Articles 14 and 16 would not be valid. For this purpose, he relied on the following judgments.

In State of Manipur and others Vs. Y. Token Singh and others, reported at (2007)5 SCC 65 : [2007(6) ALL MR 439 (S.C.)], the Supreme Court underlined the necessity of following the constitutional schemes under Articles 14 and 16 while offering appointments in the context of absence of any recruitment rules framed by the State of Manipur. The workmen concerned could not show that they were appointed after applications were invited by publishing advertisement. The Court held that the workmen concerned were not at all entitled to hold the post.

In State of U.P. and others Vs. Desh Raj, reported at (2007)1 SCC 257 : [2006 ALL MR (Cri) 2387 (S.C.)], the Court held that appointments made without following the constitutional scheme of equality under Articles 14 and 16 would be illegal and void ab initio. The Court held that the question of regularization of such employees by reason of any policy decision adopted by the State is impermissible in law.

In Secretary, State of Karnataka and others Vs. Umadevi (3) and others, reported at (2006)4 SCC 1 :[2008 ALL SCR 134], the Constitution Bench of the Supreme Court clearly held that a Court would be disabled from passing an order upholding a violation of Article 14 or in order to overlook the need to comply with requirements of Article 14 read with Article 16 of the Constitution. In view of this, there can be no doubt that ordinarily an employee would not be entitled to claim regularization if his entry is by the back-door not having been a result of applying in pursuance of the advertisement.

13. The learned counsel for the workmen submitted that their appointments may have been irregular and, therefore, could have been regularized and for this purpose, sought to draw attention to the distinction between irregular appointments and illegal appointments. On behalf of the APMC too, it was submitted that if an appointment is illegal, it could not at all have been regularized and to bring out the distinction between irregular appointments and illegal appointments, reliance was placed on number of judgments.

14. In Municipal Corporation, Jabalpur Vs. Om Prakash Dubey, reported at (2007)1 SCC 373, the Supreme Court considered the distinction between irregularly appointed and illegally appointed employees and held in para 11 as under :

"11. The question which, thus, arises for consideration, would be : Is there any distinction between "irregular appointment" and "illegal appointment" ? The distinction between the two terms is apparent. In the event the appointment is made in total disregard of the constitutional scheme as also the recruitment rules framed by the employer, which is State within the meaning of Article 12 of the Constitution of India, the recruitment would be an illegal one; whereas there may be cases where, although, substantial compliance with the constitutional scheme as also the rules has been made, the appointment may be irregular in the sense that some provisions of the rules might not have been strictly adhered to."

15. In State of M.P. Vs. Lalit Kumar Verma, reported at (2007)1 SCC 575, the Court was considering the case of a daily wager whose recruitment/appointment was not made in terms of statutory rules, against any clear vacancy, or to a permanent post, or on probation. The Court held that working continuously for more than six months would not entitle him to the status of a permanent employee. In paragraph 12 the Court considered the distinction between irregular and illegal appointments in the following words:

"12. The question which, thus, arises for consideration, would be: Is there any distinction between "irregular appointment" and "illegal appointment" ? The distinction between the two terms is apparent. In the event the appointment is made in total disregard of the constitutional scheme as also the recruitment rules framed by the employer, which is "State" within the meaning of Article 12 of the Constitution of India, the recruitment would be an illegal one; whereas there may be cases where, although, substantial compliance with the constitutional scheme as also the rules have been made, the appointment may be irregular in the sense that some provisions of some rules might not have been strictly adhered to."

The Court had considered Clause 2 of Standing Orders annexed to the M.P. Industrial Employees (Standing Order) Rules, 1963.

16. The learned counsel for the APMC relied on number of judgments of the Supreme Court, which, according to the learned counsel, establish a clear stream of authority discouraging regularization of persons in the position of the workmen.

17. In National Fertilizers Ltd. and others Vs. Somvir Singh, reported at (2006)5 SCC 493, the Court was considering the question of regularization of temporary employees, who had been appointed despite a ban on recruitment without any advertisement and without any intimation to the employment exchange on the basis of only applications made by them. The Court held that regularization is not a mode of appointment. If appointment is made without following rules, it would be nullity. The Court, therefore, held the employees disentitled to regularization.

18. In Mahendra L. Jain and others Vs. Indore Development Authority and others, reported at (2005)1 SCC 639, the Supreme Court was again considering the question of regularization of appointments and held that irregular appointments could be regularized but not illegal appointments. There too, the Court had considered clause 2 of the relevant Standard Standing Orders. In para 19, the Court observed as under :

"19. The question, therefore, which arises for consideration is as to whether they could lay a valid claim for regularisation of their services. The answer thereto must be rendered in the negative. Regularisation cannot be claimed as a matter of right. An illegal appointment cannot be legalised by taking recourse to regularisation. What can be regularised is an irregularity and not an illegality. The constitutional scheme which the country has adopted does not contemplate any back-door appointment. A State before offering public service to a person must comply with the constitutional requirements of Articles 14 and 16 of the Constitution. All actions of the State must conform to the constitutional requirements. A daily-wager in the absence of a statutory provision in this behalf would not be entitled to regularisation."

In para 31, the Court held that the Standing Orders must be read subject to the constitutional limitations, which would prevail over all the statutes.

19. In State of U.P. Vs. Neeraj Awasthi and others, reported at (2006)1 SCC 667, against 3395 posts 5600 appointments were made and those employees had completed more than 1000 days of service. The Board had proposed regularization of services of those employees. Approval was sought from the State Government and eventually the State Government directed that the services of such employees, who had been irregularly appointed between 1-4-1996 and 30-10-1997 should be cancelled. The High Court had directed the Government to frame a scheme for regularization of employees. The Supreme Court held in para 77 that as appointments had been made de hors the Rules and without following the procedure known in law and in flagrant violation of the constitutional scheme as laid down in Articles 14 and 16 of the Constitution, the appointments although might have been made in exigencies of services, they must be held to be wholly illegal and without jurisdiction. The Court held that the Board had no jurisdiction to frame any scheme for regularization. However, the Court directed to fill up existing vacancies according to law and while doing so amongst eligible candidates to consider the employees whose services had been terminated by relaxing age bar, if permissible.

20. In Accounts Officer (A&I) A.P.S.R.T.C. and others Vs. P. Chandra Sekhara Road and others, reported at (2006)7 SCC 488, the Court held that appointments made on contractual basis or on daily wages in violation of statutory Rules were void ab initio and, therefore, question of regularization of services of such employees would not arise.

21. In National Fertilizers Ltd. and others Vs. Somvir Singh, reported at (2006)5 SCC 493, the Court reiterated that an irregular appointment could be regularized, but not an illegal one. The Court held that the appointment of the workman concerned was illegal and, therefore, he does not have any legal right to continue in service.

22. In A. Umarani Vs. Registrar, Co-operative Societies and others, reported at (2004)7 SCC 112, the Supreme Court had held that the regularization is not and cannot be a mode of recruitment. In that case, about 39% of the employees working in Co-operative Societies in the State of Tamil Nadu were appointed without notifying the vacancies in the employment exchange and without following the provisions of the Act and the Rules. Many of them did not have the requisite educational qualifications. Reservation policy was also not followed and recruitment was made beyond the sanctioned strength. In order to condone the lapses, the Government of Tamil Nadu issued various orders from time to time, legality whereof was considered by the Division Bench of the High Court. The High Court held that the employees were not entitled to regularization. In this context, the Supreme Court observed that those, who come by the back-door should also go through that door and that regularization cannot give permanency to the employees concerned, whose services are ad hoc in nature.

23. In State of Uttaranchal and another Vs. Prantiya Sinchai Avam Bandh Yogana Shramik Mahaparishad, reported at (2007)12 SCC 483 : [2007 ALL SCR 2648], the Court held that before any regularization could be ordered, it has to be found out whether there is any sanctioned post and, therefore, remitted the matter back to the Labour Court.

24. In Haryana State Electronics Development Corporation Ltd. Vs. Mamni, reported at (2006)9 SCC 434, the employee concerned had been appointed for several stretches of 89 days each after giving a day's gap. The Court held this to be lacking in bona fides. However, considering the fact that the workman concerned had not applied when the post was advertised, her services could not have been regularized in view of the judgment in Umadevi's case. The Court directed payment of compensation of Rs.25,000/- to the employee.

25. The learned counsel for the APMC submitted that since regularization is not a mode of recruitment after the posts were sanctioned, it was obligatory for the APMC to advertise them and to fill them up. At that time, the workmen concerned could have also been considered along with others, who could have applied. For this purpose, he relied on the following judgments.

26. The learned counsel for the workmen submitted that it is not open for the APMC to contend that entry of the workmen was illegal, because there is no whisper in the pleadings before the Industrial Court about the manner in which the workmen had entered the service. The learned counsel for the workmen submitted that the question whether appropriate procedure was followed or not is one of fact and if the APMC is to be held as State for the purpose of Article 12 of the Constitution, its functions would qualify to be official acts and, therefore, would be presumed under Section 114 of the Evidence Act to have been performed lawfully. The learned counsel submitted that in the absence of pleading and proof that the workmen had entered the service by the back-door, it would not be permissible to so infer, particularly in the context of the fact that it is not in dispute that the workmen concerned entered the service long ago between 3-6-1978 and 12-8-1986. The learned counsel for the APMC submitted that it would be for the workmen to show that they had entered after following a proper recruitment process. He submitted that it is nobody's case that such process was in fact followed. Therefore, according to him, it would not be open for the workmen to contend that the question of their entry in service cannot be gone into. He submitted that there could be no waiver of a statutory right.

27. In Waman Shriniwas Kini Vs. Ratilal Bhagwandas and Co., reported at 1959 Supp (2) SCR 217, the Supreme Court commented upon the question of waiver of statutory right and quoted in para 13 from an English judgment as under :

"This, in our opinion, is a correct statement of the law and is supported by high authority, Field, J. in Oscanyan Vs. Winchester Arms Company quoted with approval the observation of Swayne, J. in Hall Vs. Coppell :

"The principle is indispensable to the purity of its administration. It will not enforce what it has forbidden and denounced. The maxim Ex dolo malo non oritur actio, is limited by no such qualification. The proposition to the contrary strikes us as hardly worthy of serious refutation. Wherever the illegality appears, whether the evidence comes from one side or the other, the disclosure is fatal to the case. No consent of the defendant can neutralise its effect. A stipulation in the most solemn form, to waive the objection, would be tainted with the vice of the original contract, and void for the same reasons. Wherever the contamination reaches, it destroys."

Waiver is the abandonment of a right which normally everybody is at liberty to waive. A waiver is nothing unless it amounts to a release. It signifies nothing more than an intention not to insist upon the right. It may be deduced from acquiescence or may be implied. Chitty on Contract 21st Ed. p.381 : Stackhouse Vs. Barnston. But an agreement to waive an illegality is void on grounds of public policy and would be unenforceable."

The learned counsel for the Market Committee submitted that irregular entry of the workmen having been brought to the notice of the Court, regularization by the Committee would not help, since the Committee could not waive its own statutory obligations.

28. I have carefully considered these submissions. It would not be open for the APMC to now urge that the workmen have entered by the back-door or by not following the prescribed procedure. First, because of absence of pleadings before the Trial Court to this effect and secondly, because it is not that the workman have gate crashed into the APMC's service. The APMC cannot now take advantage of its own wrong, if any, in by-passing the regular procedure of recruitment or the requirements of Articles 14 and 16 of the Constitution and seek to throw out the workmen on this count, if they have not been accessories or conspirators in the unlawful entry in the APMC's service. In any case, having already regularized their services, it would not be open for the APMC to now contend that the workmen were not entitled to regularization at all.

29. The question of regularization need not now be reopened after the APMC itself regularized the services of the workmen concerned. However, once APMC having concluded that the workmen were liable to be regularized in their services, the question as to the date from which they were entitled to regularization would become germane. The workmen claimed regularization from the date they completed 240 days of service. It may not be necessary to refer to the Standing Orders, because in the absence of any sanctioned posts, there could be no question of regularization of services of the workmen concerned. The posts came to be sanctioned on 17-12-1989. The Industrial Court has in one case ordered regularization from 17-12-1989 and in other cases from 17-12-1991 when the complaints were filed. From the averments made by the APMC, it is clear that after the posts were sanctioned, the APMC had offered appointments to the respondents in the year 1991 on a regular basis. But the respondents declined claiming that they were working on the posts of Clerk. The fact would, however, remain that the APMC had offered appointments on regular basis in the year 1991. Therefore, regularization granted by the Industrial Court with effect from 17-12-1991 cannot at all be questioned by the Committee as improper.

30. As far as regularization granted to one of the workmen, who is respondent in Writ Petition No.4156 of 1999, with effect from 17-12-1989, this would be liable to be set aside in view of the fact that it would have been impracticable to expect the APMC to instantly order regularization upon creation of a post. It would have to ensure that the claims of any superior claimants are first considered and this would entail loss of some time. Therefore, even in this case, the regularization ought to have been granted with effect from 17-12-1991 as in the cases of other employees, also in order to avoid discrimination, as also because the APMC had itself offered appointments in the year 1991.

31. The learned counsel for the APMC submitted that regularization could not have been mistaken for the permanence and for this purpose placed reliance on the judgment in Jodhpur Vidyut Vitran Nigam Ltd. and another Vs. Nanu Ram and others, reported at (2006)12 SCC 494. The Supreme Court brought out the distinction between regularization and conferment of permanence. In that case, the workmen had been engaged for temporary construction work on muster roll on daily wages. On completion of two years of service, they had claimed regularization in terms of an arbitration award. The Supreme Court held that the High Court had failed to keep in mind the difference between the concept of grant of pay scale as distinct from the grant of permanency and, therefore, remitted the matter back to the High Court for a de novo trial.

32. In view of this, insofar as the Tribunal grants permanency to the workmen, the orders would have to be set aside. The learned counsel for the workmen submitted that considering the length of service, it would be appropriate to uphold even the order granting permanence to the workmen, since it is not shown that they were not entitled to the confirmation. In fact subsequently another set of employees appear to have been made permanently by an appellate order by the Director as noticed in Writ Petition No.2205 of 2006. The learned counsel for the APMC submitted that the question of entitlement has to be decided on the basis of what law mandates and not because of the sympathy, which the Court may have.

33. In Life Insurance Corporation of India Vs. Asha Ramchandra Ambekar (Mrs) and another, reported at (1994)2 SCC 718, on which the learned counsel for the petitioners relied, while considering the question of compassionate appointment, the Court observed in paras 10 and 11 as under :

"10. Of late, this Court is coming across many cases in which appointment on compassionate ground is directed by judicial authorities. Hence, we would like to lay down the law in this regard. The High Courts and the Administrative Tribunals cannot confer benediction impelled by sympathetic consideration. No doubt Shakespeare said in "Merchant of venice" :

"The quality of mercy is not strain'd;

It droppeth, as the gentle rain from heaven

Upon the place beneath it is twice bless'd;

It blesseth him that gives, and him that takes;"

These words will not apply to all situations. Yeilding to instinct will tend to ignore the cold logic of law. It should be remembered that "law is the embodiment of all Wisdom". Justice according to law is a principle as old as the hills. The courts are to administer law as they find it, however, inconvenient it may be.

11. At this juncture we may usefully refer to Martin Burn Ltd. Vs. Corporation of Calcutta. At page 535 of the Report the following observations are found :

"A result flowing from a statutory provision is never an evil. A Court has no power to ignore that provision to relieve what it considers a distress resulting from its operation. A statute must of course be given effect to whether a Court likes the result or not."

The courts should endeavour to find out whether a particular case in which sympathetic considerations are to be weighed falls within the scope of law. Disregardful of law, however, hard the case may be, it should never be done. ..."

34. In Indian Drugs & Pharmaceuticals Ltd. Vs. Workmen, Indian Drugs & Pharmaceuticals Ltd., reported at (2007)1 SCC 408, the Supreme Court cautioned the Court in paras 40 and 41 of the judgment as under :

"40. The courts must, therefore, exercise judicial restraint, and not encroach into the executive or legislative domain. Orders for creation of posts, appointment on these posts, regularisation, fixing pay scales, continuation in service, promotions, etc. are all executive or legislative functions, and it is highly improper for Judges to step into this sphere, except in a rare and exceptional case. The relevant case-law and philosophy of judicial restraint has been laid down by the Madras High Court in great detail in Rama Muthuramalingam Vs. Dy. Supdt. of Police and we fully agree with the views expressed therein.

41. No doubt, in some decisions the Supreme Court has directed regularisation of temporary or ad hoc employees but it is well settled that a mere direction of the Supreme Court without laying down any principle of law is not a precedent. It is only where the Supreme Court lays down a principle of law that it will amount to a precedent. Often the Supreme Court issues directions without laying down any principle of law, in which case, it is not a precedent. For instance, the Supreme Court often directs appointment of someone or regularisation of temporary employee or payment of salary, etc. without laying down any principle of law. This is often done on humanitarian considerations, but this will not operate as a precedent binding on the High Court. For instance, if the Supreme Court directs regularisation of service of an employee who had put in 3 years' service, this does not mean that all employees who had put in 3 years' service must be regularised. Hence, such a direction is not a precedent. In Municipal Committee, Amritsar Vs. Hazara Singh the Supreme Court observed that only a statement of law in a decision is binding. In State of Punjab Vs. Baldev Singh this Court observed that everything in a decision is not a precedent. In Delhi Admn. Vs. Manohar Lal the Supreme Court observed that a mere direction without laying down any principle of law is not a precedent. In Divisional Controller, KSRTC Vs. Mahadeva Shetty this Court observed as follows : (SCC p.206, para 23)

"The decision ordinarily is a decision on the case before the Court, while the principle underlying the decision would be binding as a precedent in a case which comes up for decision subsequently. ... The scope and authority of a precedent should never be expanded unnecessarily beyond the needs of a given situation. The only thing binding as an authority upon a subsequent Judge is the principle upon which the case was decided."

Again in paras 50, 51 and 52, the Court observed as under :

"50. It may be mentioned that jobs cannot be created by judicial orders, nor even by legislative or executive decisions. Jobs are created when the economy is rapidly expanding, which means when there is rapid industrialisation. At present, the State of affairs in our country is that although the economy has progressed a little in some directions, but the truth is that this has only benefited a handful of persons while the plight of the masses has worsened. Unemployment in our country is increasing, and has become massive and chronic. To give an example, for each post of a peon which is advertised in some establishments there are over a thousand applicants, many of whom have M.A., M.Sc., M.Com. or MBA degrees. Recently, about 140 posts of primary school teachers were advertised in a district in Western Madhya Pradesh, and there were about 13,000 applicants i.e. almost 100 applicants for each post. Large-scale suicides by farmers in several parts of the country also show the level of unemployment. These are the social and economic realities of the country which cannot be ignored.

51. One may be very large hearted but then economic realities have also to be seen. Giving appointments means adding extra financial burden to the national exchequer. Money for paying salaries to such appointees does not fall from the sky, and it can only be realised by imposing additional taxes on the public or taking fresh loans, both of which will only lead to additional burden on the people.

52. No doubt, Article 41 provides for the right to work, but this has been deliberately kept by the Founding Fathers of our Constitution in the directive principles and hence made unenforceable in view of Article 37, because the Founding Fathers in their wisdom realised that while it was their wish that everyone should be given employment, but the ground realities of our country cannot be overlooked. In our opinion, Article 21 of the Constitution cannot be stretched so far as to mean that everyone must be given a job. The number of available jobs are limited, and hence courts must take a realistic view of the matter and must exercise self-restraint."

35. In view of this, it would have to be left to the APMC to consider whether the workmen could be confirmed. It would not be permissible for the Industrial Court or for this Court to direct that the workmen concerned should be granted permanency.

36. In Secretary, State of Karnataka and others Vs. Umadevi (3) and others, reported at (2006)4 SCC 1 :[2008 ALL SCR 134], the Court held that public employment in a sovereign socialist secular democratic republic, has to be as set down by the Constitution on the basis of the procedure established in that behalf. Regular appointment must be the rule. The Court noted that the State and its instrumentalities had resorted to irregular appointments on contract or on daily wages, to continue year after year, thus, keeping out those who are qualified to apply for the post concerned and depriving them of an opportunity to compete for the post. The Court observed that a class of employment which could only be called "litigious employment" had risen like a phoenix seriously impairing the constitutional scheme. The Court disapproved equity for the handful of people who had approached the court with a claim, or equity for the teeming millions of this country seeking employment and seeking a fair opportunity for competing for employment. The constitutional Bench of the Supreme Court was considering conflicting opinions between the three-Judge Bench decisions and disapproved the judgments in Ashwani Kumar Vs. State of Bihar, reported at (1997)2 SCC 1; State of Haryana Vs. Piara Singh, reported at (1992)4 SCC 118; Dharwad Distt. PWD Literate Daily Wage Employees Assn. Vs. State of Karnataka, reported at (1990)2 SCC 396, and approved the judgment in B. N. Nagarajan Vs. State of Karnataka, reported at (1979)4 SCC 507. In para 19, the Supreme Court asked if the Courts could impose upon the State financial burden by insisting on regularization or permanence in employment when those employed temporarily are not needed permanently or regularly. In para 43 of the judgment, the Court observed as under :

"43. Thus, it is clear that adherence to the rule of equality in public employment is a basic feature of our Constitution and since the rule of law is the core of our Constitution, a court would certainly be disabled from passing an order upholding a violation of Article 14 or in ordering the overlooking of the need to comply with the requirements of Article 14 read with Article 16 of the Constitution. Therefore, consistent with the scheme for public employment, this Court while laying down the law, has necessarily to hold that unless the appointment is in terms of the relevant rules and after a proper competition among qualified persons, the same would not confer any right on the appointee. If it is a contractual appointment, the appointment comes to an end at the end of the contract, if it were an engagement or appointment on daily wages or casual basis, the same would come to an end when it is discontinued. Similarly, a temporary employee could not claim to be made permanent on the expiry of his term of appointment. It has also to be clarified that merely because a temporary employee or a casual wage worker is continued for a time beyond the term of his appointment, he would not be entitled to be absorbed in regular service or made permanent, merely on the strength of such continuance, if the original appointment was not made by following a due process of selection as envisaged by the relevant rules. It is not open to the court to prevent regular recruitment at the instance of temporary employees whose period of employment has come to an end or of ad hoc employees who by the very nature of their appointment, do not acquire any right. The high Courts acting under Article 226 of the Constitution, should not ordinarily issue directions for absorption, regularisation, or permanent continuance unless the recruitment itself was made regularly and in terms of the constitutional scheme. Merely because an employee had continued under cover of an order of the court, which we have described as "litigious employment" in the earlier part of the judgment, he would not be entitled to any right to be absorbed or made permanent in the service. In fact, in such cases, the High Court may not be justified in issuing interim directions, since, after all, if ultimately the employee approaching it is found entitled to relief, it may be possible for it to mould the relief in such a manner that ultimately no prejudice will be caused to him, whereas an interim direction to continue his employment would hold up the regular procedure for selection or impose on the State the burden of paying an employee who is really not required. The courts must be careful in ensuring that they do not interfere unduly with the economic arrangement of its affairs by the State or its instrumentalities or lend themselves the instruments to facilitate the bypassing of the constitutional and statutory mandates."

The Court noticed that a total embargo on casual or temporary employment was not possible, given the exigencies of administration. However, it rejected the argument that since one has been working for some time, it will not be just to discontinue him, even though he was aware of the nature of the employment when he first took it up. In para 53, the Court then clarified as under :

"53. One aspect needs to be clarified. There may be cases where irregular appointments (not illegal appointments) as explained in S. V. Narayanappa, R .N. Nanjundappa and B. N. Nagarajan and referred to in para 15 above, of duly qualified persons in duly sanctioned vacant posts might have been made and the employees have continued to work for ten years or more but without the intervention of orders of the courts or of tribunals. The question of regularisation of the services of such employees may have to be considered on merits in the light of the principles settled by this Court in the cases abovereferred to and in the light of this judgment. In that context, the Union of India, the State Governments and their instrumentalities should take steps to regularise as a one-time measure, the services of such irregularly appointed, who have worked for ten years or more in duly sanctioned posts but not under cover of orders of the courts or of tribunals and should further ensure that regular recruitments are undertaken to fill those vacant sanctioned posts that require to be filled up, in cases where temporary employees or daily wagers are being now employed. The process must be set in motion within six months from this date. We also clarify that regularisation, if any already made, but not sub judice, need not be reopened based on this judgment, but there should be no further bypassing of the constitutional requirement and regularising or making permanent, those not duly appointed as per the constitutional scheme."

37. It may be seen that the respondents are not a class of employees, who could be called litigious employees. They are not clinging to the post on the basis of any orders passed by any Court. They have been continued in service of the employer without any intervention of the Courts. Therefore, having been in service for a period of over twenty years now, their regularization, even in terms of what was held in para 53 of the judgment in Umadevi, would be proper.

38. In view of this Writ Petition No.1814 of 1998 is dismissed. Writ Petition No.4022 of 1998 and Writ Petition No.4156 of 1999 are partly allowed, setting aside the orders passed by the Industrial Court directing grant of permanence to the workmen from the dates of their regularization. The date of regularization granted by the Industrial Court in Writ Petition No.4156 of 1999 as 17-12-1989 would also have to be modified to 17-12-1991 as has been granted to the workmen in the other two writ petitions.

Ordered accordingly.