The Aeronautical Development Agency (Sponsored by the Govt. of India, Ministry of Defence) Represented by Its Director General and Others Vs. Smt. Nanjamma and Others - Court Judgment

Excerpt:
karnataka high court act - section 4 - - [mr. vikramajit sen; b.v.nagarathna , jj.] karnataka high court act - section 4 -- regular appointment must be the rule. in cases relating to service in the commercial taxes department, the high court has directed that those engaged on daily wages, be paid wages equal to the salary and allowances that are being paid to the regular employees of their cadre in government service, with effect from the dates from which they were respectively appointed. director general (labour welfare) the learned single judge thereafter directed the appellants to absorb the petitioners. the petitioners immediately approached the court when their services were sought to be altered into contract labour and their services continued for several years thereafter. the appeals filed by the respondents employees also stand dismissed.(prayer: these writ appeals are filed under section 4 of the karnataka high court act praying to set aside the order passed in the writ petition no.19936-38/1999 c/w 13829-32/1999 c/w 9564-68/1999 and 22337/1999 dated 18.03.2005.)vikramajit sen, c.j.1. it will indeed be a travesty of justice when courts decline to protect the livelihood of a person who has had the good fortune to receive employment. there is so much debate on whether there can be any meaning or substance in the fundamental right to life if it is bereft of the assurance of income through work. the republic of india should rightly be proud of schemes guaranteeing, even to a limited extent, rural employment. if the progress of our country cannot be lauded it is on account of the manifestation of the rich getting richer whilst the lot of the vast majority remains stagnant, is reason for regret. eagerness for engagement in service cannot become a crime unless it is procured by illegal means. this is how we preface the present litigation initiated by the petitioners praying for their absorption in the workforce of the appellants. there is no dispute that the respondents were employed by the aeronautical development agency (“ada” for brevity), without any coercion and without transgressing any of its rules or practices, between the years 1985 and 1989, that ada issued a circular dated 29.07.2989 proposing to engage a contractor for supply of labour leading to the filing of writ petitions assailing this device which had the regrettable result of metamorphosing their initially temporary or casual employment into an amorphous and legally tenuous one dependent entirely on the whim and while of the contractor or the employer. there was no backdoor engagement, on nepotism and no infraction of rules because none were in existence. rue the day when the courts turn a blind eye to the use of stratagems by employers to deprive a simple impoverished and the lowest rungs of society of their right to live. hat respect will our constitution then demand. and the situation is all the worse since the employer is a creature of the government who must already have expended in this protracted litigation what the petitioners would collectively have earned throughout their years of employment.2. our attention has been drawn to (i) air india vs. united labour union (1997) 9 scc 377 and (ii) steel authority of india vs. national union waterfront workers (2001) 7 scc 1 (sail) as the exposition of what the apex court earlier considered was the law, and what it thereafter and currently holds it to be. learned senior counsel for the appellants has eloquently argued that the present lis is completely covered by the constitution bench decision (iii) state of karnataka vs umadevi (2006) 4 scc 1; (iv) surinder prasad tiwari vs u.p. rajya krishi utpadan mandi parishad (2006) 7 scc 684; (v) accounts officer apsrtc vs k.v. ramana (2007)2 scc 324; (vi) pinaki chatterjee vs union of india (2009) 5 scc 193; (vii) general manager, uttaranchal jal sansthan vs laxmi devi (2009) 7 scc 205; (viii) state of rajasthan vs daya lal (2011) 2 scc 429; and (ix) union of india vs arulmozhi (2011) 7 scc 397. it is contended that the learned single judge has not applied the law correctly in the impugned judgment thereby bringing upon himself the censure and disapproval meted out by the apex court in official liquidator vs dayanand (2008) 10 scc 1 where the three judge bench had to castigated the observations in u.p. seb vs pooran chandra pandey, (2007) 11 scc 92 to the effect that the ratio in umadevi, “should not be applied by courts mechanically as if it were an euclid’s formula without seeing the facts of a particular case...... as a little difference in facts can make umadevi’s case inapplicable to the facts of that case.” in dayanand, the bench thereafter analysed several judgments of the apex court and eventually scathingly stated that the two judge decision in pooran chandra pandey “should neither be treated as binding by the high courts, tribunals and other judicial for as nor they should be relied upon or made basis for bypassing the principles laid down by the constitution bench.” learned senior counsel for the appellant has, on this predication, pressed for the rejection of the writ petitions and the acceptance of the appeals.3. perish the thought or even the possibility of any bench of the high court delivering a decision in disregard of and to a precedent established by the supreme court of india. it would tantamount to judicial indiscipline which in turn would inexorably lead to a miscarriage of injustice. jural ignorance of the law laid down by the apex court is also an abhorrence. the obverse of this principle is that every judge is duty bound to distill the factual matrix of a precedent in order to digest the dictum to be derived from it. it is our analysis that none of the decisions to which our attention has been drawn by learned senior counsel for the appellants deals with a situation where the services of persons have been engaged and have continued uninterruptedly for several years, without at its inception, transgressing extant recruitment rules or norms. air india ordained that the ‘contracted’ labour shall be deemed to be in ‘direct relationship’ with principal employer who is obliged to absorb these workers under article 226 of the constitution; and every high courts in india possesses powers to direct a principal employer to absorb such workers. it was this enunciation that came to be overruled by the constitution bench in sail where it was laid down, interalia, that engagement of contract labour does not culminate in the emergence of a master and servant relationship between the principal employer and the contract labour; and that a direction for the absorption of the erstwhile contract labour was not envisaged in law. the conclusion of the constitution bench, as are germane for the present purposes, are extracted for facility of perusal.“125 (4) we overrule the judgment of this court in air india case prospectively and declare that any direction issued by any industrial adjudicator/any court including the high court, for absorption of contract labour following the judgment in air india case shall hold good and that the same shall not be set aside, altered or modified on the basis of this judgment in cases where such a direction has been given effect to and it has become final.(5) on issuance of prohibition notification under section 10(1) of the clra act prohibiting employment of contract labour or otherwise, in an industrial dispute brought before it by any contract labour in regard to conditions of service, the industrial adjudicator will have to consider the question whether the contractor has been interposed either on the ground of having undertaken to produce any given result for the establishment or for supply of contract labour for work of the establishment under a genuine contract or is a mere ruse/camouflage to evade compliance with various beneficial legislations so as to deprive the workers of the benefit there under. if the contract is found to be not genuine but a mere camouflage, the so-called contract labour will have to be treated as employees of the principal employer who shall be directed to regularize the services of the contract labour in the establishment concerned subject to the conditions as may be specified by it for that purpose in the light of para 6 hereunder. (6) if the contract is found to be genuine and prohibition notification under section 10(1) of the clra act in respect of the establishment concerned has been issued by the appropriate government, prohibiting employment of contract labour in any process, operation or other work of any establishment and where in such process, operation or other work of the establishment the principal employer intends to employ regular workmen, he shall give preference to the erstwhile contract labour, if otherwise found suitable and, if necessary, by relaxing the condition as to maximum age appropriately, taking into consideration the age of the workers at the time of their initial employment by the contractor and also relaxing the condition a to academic qualifications other than technical qualifications.”4. we must reflect on why the contract labour system evolved. it seems to us that the simple answer is that it was an attempt to defeat the labour rights of workers by creating an artificial severance in the chain of actual employment, predictably, this practice was peremptorily ended by the contract labour (regulation and abolition) act, 1970. counsel for the employers invariably place emphasis on the 4th sub-paragraph of paragraph 125 of sail reproduced above and unfairly gloss over the next two paragraphs. it is now an integral part of our jurisprudence that the government is expected to exemplify the model employer, legislation is directed not necessarily with governmental agencies in mind since they ought to automatically implement the prevailing legal ethos. it can be expected that welfare and labour protectionist laws may be received with reluctance by private employers,. who have to be forced into compliance therewith. therefore it is indeed alarming when authorities adopt unfair labour practice, as is the example of the respondents in the present case. in rattan lal vs. state of haryana (2986) i llj 23 sc, the ex court had viewed the intentional break in service and the policy’ of adhocism to be in breach of articles 14 and 16. another bench of three learned judges in karnataka state private college stop-gap lecturers association – vs- state of karnataka and others (1993) ii llj 83 sc, without reference to any previous decisions ruled that the state government’s policy of appointing ad hoc teachers for several years, with one day break, paying salaries which were ten rupees less than the minimum payable to regular teachers was vocative of article 14. it issued directions for continuing the services of such teachers, for their regularization and for payment of salaries on par with the regular teachers, by implementing the principle of equal pay for equal work. in bhagwati prasad – vs – delhi state mineral development corporation (1990) i llj 320 sc, it was observed that once the appointments were made as daily rated workers and they are allowed to work for a considerable length of time it would be hard and harsh to deny them the confirmation in the respective post on the ground that they lack the prescribed educational qualification. a coordinate bench of three learned judges had shared the same opinion in state of haryana – vs. piara singh (1993) ii llj 937 sc as under:“49. if for any reason, an ad hoc or temporary employee is continued for a fairly long spell, the authorities must consider his case for regularization provided he is eligible and qualified according to the rules and his service record is satisfactory and his appointment does not run counter to the reservation policy of the state.50…..51. so far as the work-charges employees and casual labour are concerned, the effort must be to regularize them as far as possible and as early a possible subject to their fulfilling the qualifications. if any, prescribed for the post and subject also to availability of work. if a casual labourer is continued for a fairly long spell – say tow or three years-a presumption may arise that there is a regular need for his services. in such a situation, it becomes obligatory for the authority concerned to examine the feasibility of his regularization. while doing so, the authorities ought to adopt a positive approach coupled with an empathy for the person. as has been repeatedly stressed by this court, security of tenure is necessary for an employee to give his best to the job. in the behalf, we do commend the orders of the government of haryana (continued in its letter dated april 6, 1990 referred to hereinbefore) both in relation to work charged employees as well as casual labour.”5. quite distinct from contract labour, the second category of employees are those who have come in through the back – door by bypassing the regular mode of recruitment, or more blatantly, by bending or ignoring the rules of recruitment either because of bribery or nepotism. the employer as well as the employees in such engagements are in pari delicto, thereby disentitling them to any legal sympathy or recourse. the employees have entered service by being privy to an irregularity if not an illegality, and logically equities will not come to their rescue or succor; they cannot rely on the doctrine of legitimate expectations. in umadevi the prefactory paragraphs set the scenario by emphasing that “ a regular process of recruitment or appointment ha to be resorted to when regular vacancies in posts, at a particular point of time are to be filled up and the filling up of those vacancies cannot be done in a haphazard manner or based on patronage or other considerations. regular appointment must be the rule.” the constitution bench had to choose between two opinions that appeared to be then prevailing in the apex court; the first being ashwani kumar v. state of bihar (1997) 2 scc (1) state of haryana v. piara singh (1992) 4 scc 118 and dharward district pwd literate daily wage employees association v. state of karnataka (1990) 2 scc 396 on the one hand, and state of h.p. v. suresh kumar verma (1996) 7 scc 562, state of punjab v. surender kumar (1992) 1 scc 489 and b.n. nagarajan v. state of karnataka (1979) 4 scc 507 on the other. after considering the gamut of decisions on this jural cleavage, the constitution bench made the following elucidatory pronouncement.“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 no interfere unduly with the economic arrangement of its affairs by the state of its instrumentalities or lend themselves the instruments to facilitate the bypassing of the constitutional and statutory mandates.”xxx xxx xxx“45. while directing that appointments temporary or casual, be regularized or made permanent, the courts are swayed by the fact that the person concerned has worked for some time and in some cases for a considerable length of time. it is not as if the person who accepts an engagement either temporary or casual in nature, is not aware of the nature of his employment. he accepts the employment with open eyes. it may be true that he is not in a position to bargain-not at arm’s length-since he might have been searching for some employment so as to eke out his livelihood and accepts whatever he gets. but on that ground alone, it would not be appropriate to jettison the constitutional schemes of appointment and to take the view that a person who has temporarily or casually got employed should be directed to be continued permanently. by doing so, it will be creating another mode of public appointment which is not permissible. if the court were to void a contractual employment of this nature on the ground that the parties were not having equal bargaining power, that too would not enable the court to grant any relief to that employee. a total embargo on such casual or temporary employment is not possible, given the exigencies of administration and if imposed, would only mean that some people who at least get employment temporarily, contractually or casually, would not be getting even that employment when securing of such employment brings at least some succor to them. after all, innumerable citizens of our vast country are in search of employment and one is not compelled to accept a casual or temporary employment if one is not inclined to go in for such an employment. it is in that context that one has to proceed on the basis that the employment was accepted fully knowing the nature of it and the consequences flowing from it. in other words, even while accepting the employment, the person concerned knows the nature of his employment. it is not an appointment to a post in the real sense of the term. the claim acquired by him in the post in which he is temporally employed or the interest in that post cannot be considered to be of such a magnitude as to enable the giving up of the procedure established, for making regular appointments to available posts in the services of the state. the argument that since one has been working for some time in the post, it will not be just to discontinue him, even though he was aware of the nature of the employment when he first took it up, is not (sic) one that would enable the jettisoning of the procedure established by law for public employment and would have to fail when tested on the touchstone of constitutionality and equality of opportunity enshrined in article 14 of the constitution.”xxx xxx xxx“47. when a person enters a temporary employment or gets engagement as a contractual or casual worker and the engagement is not based on a proper selection as recognized by the relevant rules or procedure, he is aware of the consequences of the appointment being temporary, casual or contractual in nature. such a person cannot invoke the theory of legitimate expectation for being confirmed in the post when an appointment to the post could be made only by following proper procedure for selection and in cases concerned, in consultation with the public service commission. therefore, the theory of legitimate expectation cannot be successfully advanced by temporary, contractual or casual employees. it cannot also be held that the state has held out any promise while engaging these persons either to continue them where they are or to make them permanent. the state cannot constitutionally make such a promise. it is also obvious that the theory cannot be invoked to seek a positive relief of being made permanent in the post.xx xxx xxx55. in cases relating to service in the commercial taxes department, the high court has directed that those engaged on daily wages, be paid wages equal to the salary and allowances that are being paid to the regular employees of their cadre in government service, with effect from the dates from which they were respectively appointed. the objection taken was to the direction for payment from the dates of engagement. we find that the high court had already gone wrong in directing that these employees be paid salary equal to the salary and allowances that are being paid to the regular employees of their cadre in government service, with effect from the dates from which they were respectively engaged or appointed. it was not open to the high court to impose such an obligation on the state when the very question before the high court in the case was whether these employees were entitled to have equal pay for equal work so called and were entitled to any other benefit. they had also been engaged in the teeth of directions not to do so. we are, therefore, of the view that, at best, the division bench of the high court should have directed that wages equal to the salary that is being paid to regular employees be paid to these daily-wage employees with effect from the date of its judgment. hence, that part of the direction of the division bench is modified and it is directed that these daily-wage earners be paid wages equal to the salary at the lowest grade of employees of their cadre in the commercial taxes department in government service, from the date of the judgment of the division bench of the high court. since, they are only daily wage earners, there would be no question of other allowances being paid to them. in view of our conclusion, that the courts are not expected to issue directions for making such persons permanent in service, we set aside that part of the direction of the high court directing the government to consider their cases for regularisation. we also notice that the high court has not adverted to the aspect as to whether it was regularisation or it was giving permanency that was being directed by the high court. in such a situation, the direction in that regard will stand deleted and the appeals filed by the state would stand allowed to that extent. if sanctioned posts are vacant (they are said to be vacant) the state will take immediate steps for filling those posts by a regular process of selection. but when regular recruitment is undertaken, the respondents in cas nos. 3595-612 and those in the commercial taxes department similarly situated, will be allowed to compete, waiving the age restriction imposed for the recruitment and giving some weightage for their having been engaged for work in the department for a significant period of time. that would be the extent of the exercise of power by this court under article 142 of the constitution to do justice to them.”6. we reiterate that there is plethora of precedents prescribing that contract labour cannot be regularized contrary to rules and regulations binding on the employer. there is a second category of cases, the dichotomy having been removed of umadevi, where daily wagers, casual employees or other persons who are taken on the roles contrary to rules and regulations applicable at the time of their entering service, and in these cases, it has also been held that they are not entitled to regularisation. however, there is a third category of employees also such as those engaged in private corporations, private businesses and enterprises etc, who have been legitimately engaged by the person having authority to do so simply because recruitment rules and regulations were then not in force. in their services are not legally protected the rationale behind labour laws would be rendered otiose and redundant. so far as this third category is concerned, the apex court has given several rulings including that continuance of duty uninterruptedly for a period of 160 days or 240 days would entitle them to security of service. these rulings are possible only because there are no rules and regulations to the contrary and security or permanence of tenure of service is accepted as an integral and inviolable human right. unlike the first two categories where the employer as well as the employee acts in consort and design, irregularity or illegality in engagement is absent and the employer and employee are not ‘in pari delicto’. having pondered on the points that arise in this dispute, we think that the petitioners fall in the third category. in satya prakash –vs- state of bihar (2010) 4 scc 179, umadevi was again discussed in detail and their lordship have clarified that whilst directions for transforming the d hoc service into permanent character through absorption ought not to be mandated by the writ court, wages equal to those payable to regular employees can be ordered. even earlier in maharashtra srtc –vs- premlal (2007) 9 scc 141, daily wagers who had served for 180 days were held entitled to be entitled to pecuniary benefits, although not to absorption.7. at the commencement, we had mentioned that there has been protracted litigations between the parties. at no stage of the litigation has it been disputed that the petitioners were working on daily rate wage basis as sweepers, helpers, messengers, clerks etc., uninterruptedly for several years. for reasons which are not forthcoming and which ought to have been candidly designed by the appellants, a decision was taken in july 1989 to engage the services of a contractor. pursuant to these decisions, the employees who had already put in several years of service, and who reasonably anticipated an unfavourable change in the nature of their employment, filed writ petitions against the appellants. the appellants plead that their services were terminated on 01.08.1989. it is evident that whilst the services of the petitioners had continued for sometime in the changed form of contract workers, they had never accepted this attempted change thrust on them by the appellants-employers. the learned single judge as his lordship, h.l.dattu, by orders dated 29.05.1996, directed the central government to take suitable action under section 10 of the clra act, until such action was taken, the employment of the respondents would continue. dissatisfied with this decision, the petitioners filed wa nos.7641-7656/1996, 7155-72/1996 and 7173-81/1996 and other connected matters. the order of the learned single judge was upheld which included these reliefs “(e) till the report is submitted and effective orders thereon are passed by the union of india, the interim arrangement presently invoked shall be continued and none of the employees shall be denied the work by the employers of its contractor, (f) if any one of the workmen has not been provided employment so far after the order of the learned single judge, the employer shall provide them the employment if they report for duty”. eventually, on 05.11.1998, the following notification was passed.“notificationno. s.o. in exercise of the powers conferred by sub-section (1) of section 10 of the contract labour (regulation and abolition) act, 1970 (37 of 1970), the central government after consultation with the central advisory contract labour board, hereby prohibits the employment of contract labour in the jobs specified in the schedule annexed hereto in the aeronautical development agency, the national aeronautical laboratory campus, belur, bangalore.schedule:1. helpers;2. messangers;3. attenders; and4.despatach clerks.sd/xx(s d das)director general (labour welfare)joint secretary to the government of india(file no.u-23013/30/07-lw)”obviously, a copy of this notification was not conveyed to the petitioners leading them to file contempt petitions, which were disposed of by the division bench by orders dated 07.12.1998. the notification dated 05.10.1998, having been placed on record, those contempt petitions were dismissed as withdrawn, “with liberty to the complainants or any other workmen to approach the court afresh, if they feel that the directions with respect to their absorption and regularization have not been complied with.”8. the obdurate if not recalcitrant/refusal of the appellants to abide by the orders of the division bench constrained the writ petitioners to file the second salvo of writ petitions on which the impugned orders dated 18.03.2005 came to be passed. the learned single judge has interalia, found that a) the attempt of the appellants ‘clearly establishes that there are vacancies in ada to absorb the petitioners; (b) that during the years 1985-1989, the petitioners were appointed on daily wages and they continued in service till their termination on 02.03.1999 after 14 to 15 years services with the appellants. the learned single judge thereafter concluded that the petitioners were entitled for absorption that their termination by the appellants was illegal. the learned single judge thereafter directed the appellants to absorb the petitioners. therefore, even if the pronouncements relating to the first two categories of employment discussed above are applied, it is manifestly clear that the impugned order does not direct the creation of any posts or the regularization of the petitioners. the impugned order merely ordains the continuance of the status-quo-ante. as we have already noted above, it is not the case of the appellants that the recruitments of the petitioners at its inception was contrary to any rules and regulations. on the contrary it is evident that in 1985, the appellants were setting up their establishment, and therefore, engaged the services of the petitioners in menial or ministerial duties. here was no infraction of any rules, no back-door entry, no nepotism and no bribery or corruption in the engagement of their services. the petitioners immediately approached the court when their services were sought to be altered into contract labour and their services continued for several years thereafter. eventually, the central government recommended the discontinuance of the so-called contract labour arrangement which was unilaterally adopted by the appellants and arbitrarily thrust upon the petitioners. we find no error in the impugned order. accordingly, the applies filed by the aeronautical development agency are dismissed with costs of rs.10,000/-, payable to each of the respondents-employees who were represented before us. the appeals filed by the respondents employees also stand dismissed.

Judgment:

(Prayer: These Writ appeals are filed under Section 4 of the Karnataka High Court Act praying to set aside the order passed in the Writ Petition No.19936-38/1999 c/w 13829-32/1999 c/w 9564-68/1999 and 22337/1999 dated 18.03.2005.)

Vikramajit Sen, C.J.

1. It will indeed be a travesty of justice when Courts decline to protect the livelihood of a person who has had the good fortune to receive employment. There is so much debate on whether there can be any meaning or substance in the fundamental right to life if it is bereft of the assurance of income through work. The Republic of India should rightly be proud of schemes guaranteeing, even to a limited extent, rural employment. If the progress of our country cannot be lauded it is on account of the manifestation of the rich getting richer whilst the lot of the vast majority remains stagnant, is reason for regret. Eagerness for engagement in service cannot become a crime unless it is procured by illegal means. This is how we preface the present litigation initiated by the Petitioners praying for their absorption in the workforce of the Appellants. There is no dispute that the Respondents were employed by the Aeronautical Development Agency (“ADA” for brevity), without any coercion and without transgressing any of its Rules or practices, between the years 1985 and 1989, that ADA issued a Circular dated 29.07.2989 proposing to engage a Contractor for supply of labour leading to the filing of writ petitions assailing this device which had the regrettable result of metamorphosing their initially temporary or casual employment into an amorphous and legally tenuous one dependent entirely on the whim and while of the contractor or the employer. There was no backdoor engagement, on nepotism and no infraction of Rules because none were in existence. Rue the day when the Courts turn a blind eye to the use of stratagems by employers to deprive a simple impoverished and the lowest rungs of society of their right to live. Hat respect will our Constitution then demand. And the situation is all the worse since the employer is a creature of the Government who must already have expended in this protracted litigation what the Petitioners would collectively have earned throughout their years of employment.

2. Our attention has been drawn to (i) Air India vs. United Labour Union (1997) 9 SCC 377 and (ii) Steel Authority of India vs. National Union Waterfront Workers (2001) 7 SCC 1 (SAIL) as the exposition of what the Apex Court earlier considered was the law, and what it thereafter and currently holds it to be. Learned Senior Counsel for the Appellants has eloquently argued that the present lis is completely covered by the Constitution bench decision (iii) State of Karnataka vs Umadevi (2006) 4 SCC 1; (iv) Surinder Prasad Tiwari vs U.P. Rajya Krishi Utpadan Mandi Parishad (2006) 7 SCC 684; (v) Accounts Officer APSRTC vs K.V. Ramana (2007)2 SCC 324; (vi) Pinaki Chatterjee vs Union of India (2009) 5 SCC 193; (vii) General Manager, Uttaranchal Jal Sansthan vs Laxmi Devi (2009) 7 SCC 205; (viii) State of Rajasthan vs Daya Lal (2011) 2 SCC 429; and (ix) Union of India vs Arulmozhi (2011) 7 SCC 397. It is contended that the learned Single Judge has not applied the law correctly in the impugned judgment thereby bringing upon himself the censure and disapproval meted out by the Apex Court in Official Liquidator vs Dayanand (2008) 10 SCC 1 where the three Judge Bench had to castigated the observations in U.P. SEB vs Pooran Chandra Pandey, (2007) 11 SCC 92 to the effect that the ratio in Umadevi, “should not be applied by Courts mechanically as if it were an Euclid’s formula without seeing the facts of a particular case...... As a little difference in facts can make Umadevi’s case inapplicable to the facts of that case.” In Dayanand, the Bench thereafter analysed several judgments of the Apex Court and eventually scathingly stated that the two Judge decision in Pooran Chandra Pandey “should neither be treated as binding by the High Courts, Tribunals and other judicial for as nor they should be relied upon or made basis for bypassing the principles laid down by the Constitution Bench.” Learned Senior Counsel for the Appellant has, on this predication, pressed for the rejection of the writ petitions and the acceptance of the appeals.

3. Perish the thought or even the possibility of any Bench of the High Court delivering a decision in disregard of and to a precedent established by the Supreme Court of India. It would tantamount to judicial indiscipline which in turn would inexorably lead to a miscarriage of injustice. Jural ignorance of the law laid down by the Apex Court is also an abhorrence. The obverse of this principle is that every Judge is duty bound to distill the factual matrix of a precedent in order to digest the dictum to be derived from it. It is our analysis that none of the decisions to which our attention has been drawn by learned Senior Counsel for the Appellants deals with a situation where the services of persons have been engaged and have continued uninterruptedly for several years, without at its inception, transgressing extant recruitment rules or norms. Air India ordained that the ‘contracted’ labour shall be deemed to be in ‘direct relationship’ with principal employer who is obliged to absorb these workers under Article 226 of the Constitution; and every High Courts in India possesses powers to direct a principal employer to absorb such workers. It was this enunciation that came to be overruled by the Constitution Bench in SAIL where it was laid down, interalia, that engagement of contract labour does not culminate in the emergence of a master and servant relationship between the principal employer and the contract labour; and that a direction for the absorption of the erstwhile contract labour was not envisaged in law. The conclusion of the Constitution Bench, as are germane for the present purposes, are extracted for facility of perusal.

“125 (4) We overrule the judgment of this Court in Air India case prospectively and declare that any direction issued by any industrial adjudicator/any court including the High Court, for absorption of contract labour following the judgment in AIR India case shall hold good and that the same shall not be set aside, altered or modified on the basis of this judgment in cases where such a direction has been given effect to and it has become final.

(5) On issuance of prohibition notification under Section 10(1) of the CLRA Act prohibiting employment of contract labour or otherwise, in an industrial dispute brought before it by any contract labour in regard to conditions of service, the industrial adjudicator will have to consider the question whether the contractor has been interposed either on the ground of having undertaken to produce any given result for the establishment or for supply of contract labour for work of the establishment under a genuine contract or is a mere ruse/camouflage to evade compliance with various beneficial legislations so as to deprive the workers of the benefit there under. If the contract is found to be not genuine but a mere camouflage, the so-called contract labour will have to be treated as employees of the principal employer who shall be directed to regularize the services of the contract labour in the establishment concerned subject to the conditions as may be specified by it for that purpose in the light of para 6 hereunder. (6) If the contract is found to be genuine and prohibition notification under Section 10(1) of the CLRA Act in respect of the establishment concerned has been issued by the appropriate Government, prohibiting employment of contract labour in any process, operation or other work of any establishment and where in such process, operation or other work of the establishment the principal employer intends to employ regular workmen, he shall give preference to the erstwhile contract labour, if otherwise found suitable and, if necessary, by relaxing the condition as to maximum age appropriately, taking into consideration the age of the workers at the time of their initial employment by the contractor and also relaxing the condition a to academic qualifications other than technical qualifications.”

4. We must reflect on why the contract labour system evolved. It seems to us that the simple answer is that it was an attempt to defeat the labour rights of workers by creating an artificial severance in the chain of actual employment, predictably, this practice was peremptorily ended by the Contract Labour (Regulation and Abolition) Act, 1970. Counsel for the employers invariably place emphasis on the 4^th sub-paragraph of paragraph 125 of SAIL reproduced above and unfairly gloss over the next two paragraphs. It is now an integral part of our jurisprudence that the Government is expected to exemplify the model employer, Legislation is directed not necessarily with governmental agencies in mind since they ought to automatically implement the prevailing legal ethos. It can be expected that welfare and labour protectionist laws may be received with reluctance by private employers,. Who have to be forced into compliance therewith. Therefore it is indeed alarming when Authorities adopt unfair labour practice, as is the example of the Respondents in the present case. In Rattan Lal Vs. State of Haryana (2986) I LLJ 23 SC, the ex Court had viewed the intentional break in service and the policy’ of adhocism to be in breach of Articles 14 and 16. Another Bench of three learned Judges in Karnataka State Private College Stop-Gap Lecturers Association – Vs- State of Karnataka and others (1993) II LLJ 83 SC, without reference to any previous decisions ruled that the State Government’s policy of appointing ad hoc Teachers for several years, with one day break, paying salaries which were ten rupees less than the minimum payable to regular Teachers was vocative of Article 14. It issued directions for continuing the services of such Teachers, for their regularization and for payment of salaries on par with the regular Teachers, by implementing the principle of equal pay for equal work. In Bhagwati Prasad – Vs – Delhi State Mineral Development Corporation (1990) I LLJ 320 SC, it was observed that once the appointments were made as daily rated workers and they are allowed to work for a considerable length of time it would be hard and harsh to deny them the confirmation in the respective post on the ground that they lack the prescribed educational qualification. A coordinate Bench of three Learned Judges had shared the same opinion in State of Haryana – Vs. Piara Singh (1993) II LLJ 937 SC as under:

“49. If for any reason, an ad hoc or temporary employee is continued for a fairly long spell, the authorities must consider his case for regularization provided he is eligible and qualified according to the rules and his service record is satisfactory and his appointment does not run counter to the reservation policy of the State.

50…..

51. So far as the work-charges employees and casual labour are concerned, the effort must be to regularize them as far as possible and as early a possible subject to their fulfilling the qualifications. If any, prescribed for the post and subject also to availability of work. If a casual labourer is continued for a fairly long spell – say tow or three years-a presumption may arise that there is a regular need for his services. In such a situation, it becomes obligatory for the authority concerned to examine the feasibility of his regularization. While doing so, the authorities ought to adopt a positive approach coupled with an empathy for the person. As has been repeatedly stressed by this Court, security of tenure is necessary for an employee to give his best to the job. In the behalf, we do commend the orders of the Government of Haryana (continued in its letter dated April 6, 1990 referred to hereinbefore) both in relation to work charged employees as well as casual labour.”

5. Quite distinct from contract labour, the second category of employees are those who have come in through the back – door by bypassing the regular mode of recruitment, or more blatantly, by bending or ignoring the rules of recruitment either because of bribery or nepotism. The employer as well as the employees in such engagements are in pari delicto, thereby disentitling them to any legal sympathy or recourse. The employees have entered service by being privy to an irregularity if not an illegality, and logically equities will not come to their rescue or succor; they cannot rely on the doctrine of legitimate expectations. In Umadevi the prefactory paragraphs set the scenario by emphasing that “ a regular process of recruitment or appointment ha to be resorted to when regular vacancies in posts, at a particular point of time are to be filled up and the filling up of those vacancies cannot be done in a haphazard manner or based on patronage or other considerations. Regular appointment must be the rule.” The Constitution bench had to choose between two opinions that appeared to be then prevailing in the Apex Court; the first being Ashwani Kumar v. State of Bihar (1997) 2 SCC (1) State of Haryana v. Piara Singh (1992) 4 SCC 118 and Dharward District PWD Literate Daily Wage Employees Association v. State of Karnataka (1990) 2 SCC 396 on the one hand, and State of H.P. v. Suresh Kumar Verma (1996) 7 SCC 562, State of Punjab v. Surender Kumar (1992) 1 SCC 489 and B.N. Nagarajan v. State of Karnataka (1979) 4 SCC 507 on the other. After considering the gamut of decisions on this jural cleavage, the Constitution Bench made the following elucidatory pronouncement.

“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 no interfere unduly with the economic arrangement of its affairs by the State of its instrumentalities or lend themselves the instruments to facilitate the bypassing of the constitutional and statutory mandates.”

Xxx xxx xxx

“45. While directing that appointments temporary or casual, be regularized or made permanent, the courts are swayed by the fact that the person concerned has worked for some time and in some cases for a considerable length of time. It is not as if the person who accepts an engagement either temporary or casual in nature, is not aware of the nature of his employment. He accepts the employment with open eyes. It may be true that he is not in a position to bargain-not at arm’s length-since he might have been searching for some employment so as to eke out his livelihood and accepts whatever he gets. But on that ground alone, it would not be appropriate to jettison the constitutional schemes of appointment and to take the view that a person who has temporarily or casually got employed should be directed to be continued permanently. By doing so, it will be creating another mode of public appointment which is not permissible. If the court were to void a contractual employment of this nature on the ground that the parties were not having equal bargaining power, that too would not enable the court to grant any relief to that employee. A total embargo on such casual or temporary employment is not possible, given the exigencies of administration and if imposed, would only mean that some people who at least get employment temporarily, contractually or casually, would not be getting even that employment when securing of such employment brings at least some succor to them. After all, innumerable citizens of our vast country are in search of employment and one is not compelled to accept a casual or temporary employment if one is not inclined to go in for such an employment. It is in that context that one has to proceed on the basis that the employment was accepted fully knowing the nature of it and the consequences flowing from it. In other words, even while accepting the employment, the person concerned knows the nature of his employment. It is not an appointment to a post in the real sense of the term. The claim acquired by him in the post in which he is temporally employed or the interest in that post cannot be considered to be of such a magnitude as to enable the giving up of the procedure established, for making regular appointments to available posts in the services of the State. The argument that since one has been working for some time in the post, it will not be just to discontinue him, even though he was aware of the nature of the employment when he first took it up, is not (sic) one that would enable the jettisoning of the procedure established by law for public employment and would have to fail when tested on the touchstone of constitutionality and equality of opportunity enshrined in Article 14 of the Constitution.”

Xxx xxx xxx

“47. When a person enters a temporary employment or gets engagement as a contractual or casual worker and the engagement is not based on a proper selection as recognized by the relevant rules or procedure, he is aware of the consequences of the appointment being temporary, casual or contractual in nature. Such a person cannot invoke the theory of legitimate expectation for being confirmed in the post when an appointment to the post could be made only by following proper procedure for selection and in cases concerned, in consultation with the Public Service Commission. Therefore, the theory of legitimate expectation cannot be successfully advanced by temporary, contractual or casual employees. It cannot also be held that the State has held out any promise while engaging these persons either to continue them where they are or to make them permanent. The State cannot constitutionally make such a promise. It is also obvious that the theory cannot be invoked to seek a positive relief of being made permanent in the post.

Xx xxx xxx

55. In cases relating to service in the Commercial taxes Department, the High Court has directed that those engaged on daily wages, be paid wages equal to the salary and allowances that are being paid to the regular employees of their cadre in government service, with effect from the dates from which they were respectively appointed. The objection taken was to the direction for payment from the dates of engagement. We find that the High Court had already gone wrong in directing that these employees be paid salary equal to the salary and allowances that are being paid to the regular employees of their cadre in government service, with effect from the dates from which they were respectively engaged or appointed. It was not open to the High Court to impose such an obligation on the State when the very question before the High Court in the case was whether these employees were entitled to have equal pay for equal work so called and were entitled to any other benefit. They had also been engaged in the teeth of directions not to do so. We are, therefore, of the view that, at best, the Division Bench of the High Court should have directed that wages equal to the salary that is being paid to regular employees be paid to these daily-wage employees with effect from the date of its judgment. Hence, that part of the direction of the Division bench is modified and it is directed that these daily-wage earners be paid wages equal to the salary at the lowest grade of employees of their cadre in the Commercial Taxes Department in government service, from the date of the judgment of the Division Bench of the High Court. Since, they are only daily wage earners, there would be no question of other allowances being paid to them. In view of our conclusion, that the courts are not expected to issue directions for making such persons permanent in service, we set aside that part of the direction of the High Court directing the Government to consider their cases for regularisation. We also notice that the High Court has not adverted to the aspect as to whether it was regularisation or it was giving permanency that was being directed by the High Court. In such a situation, the direction in that regard will stand deleted and the appeals filed by the State would stand allowed to that extent. If sanctioned posts are vacant (they are said to be vacant) the State will take immediate steps for filling those posts by a regular process of selection. But when regular recruitment is undertaken, the respondents in CAs Nos. 3595-612 and those in the Commercial taxes Department similarly situated, will be allowed to compete, waiving the age restriction imposed for the recruitment and giving some weightage for their having been engaged for work in the Department for a significant period of time. That would be the extent of the exercise of power by this Court under Article 142 of the Constitution to do justice to them.”

6. We reiterate that there is plethora of precedents prescribing that contract labour cannot be regularized contrary to rules and regulations binding on the employer. There is a second category of cases, the dichotomy having been removed of Umadevi, where daily wagers, casual employees or other persons who are taken on the roles contrary to rules and regulations applicable at the time of their entering service, and in these cases, it has also been held that they are not entitled to regularisation. However, there is a third category of employees also such as those engaged in private corporations, private businesses and enterprises etc, who have been legitimately engaged by the person having authority to do so simply because recruitment rules and regulations were then not in force. In their services are not legally protected the rationale behind Labour Laws would be rendered otiose and redundant. So far as this third category is concerned, the Apex Court has given several rulings including that continuance of duty uninterruptedly for a period of 160 days or 240 days would entitle them to security of service. These rulings are possible only because there are no rules and regulations to the contrary and security or permanence of tenure of service is accepted as an integral and inviolable human right. Unlike the first two categories where the employer as well as the employee acts in consort and design, irregularity or illegality in engagement is absent and the employer and employee are not ‘in pari delicto’. Having pondered on the points that arise in this dispute, we think that the petitioners fall in the third category. In Satya Prakash –Vs- State of Bihar (2010) 4 SCC 179, Umadevi was again discussed in detail and their Lordship have clarified that whilst directions for transforming the d hoc service into permanent character through absorption ought not to be mandated by the writ court, wages equal to those payable to regular employees can be ordered. Even earlier in Maharashtra SRTC –Vs- Premlal (2007) 9 SCC 141, daily wagers who had served for 180 days were held entitled to be entitled to pecuniary benefits, although not to absorption.

7. At the commencement, we had mentioned that there has been protracted litigations between the parties. At no stage of the litigation has it been disputed that the petitioners were working on daily rate wage basis as sweepers, helpers, messengers, clerks etc., uninterruptedly for several years. For reasons which are not forthcoming and which ought to have been candidly designed by the appellants, a decision was taken in July 1989 to engage the services of a Contractor. Pursuant to these decisions, the employees who had already put in several years of service, and who reasonably anticipated an unfavourable change in the nature of their employment, filed writ petitions against the appellants. The appellants plead that their services were terminated on 01.08.1989. It is evident that whilst the services of the petitioners had continued for sometime in the changed form of contract workers, they had never accepted this attempted change thrust on them by the appellants-employers. The learned Single Judge as His Lordship, H.L.Dattu, by orders dated 29.05.1996, directed the Central Government to take suitable action under Section 10 of the CLRA Act, until such action was taken, the employment of the respondents would continue. Dissatisfied with this decision, the petitioners filed WA nos.7641-7656/1996, 7155-72/1996 and 7173-81/1996 and other connected matters. The order of the learned Single Judge was upheld which included these reliefs “(e) till the report is submitted and effective orders thereon are passed by the Union of India, the interim arrangement presently invoked shall be continued and none of the employees shall be denied the work by the employers of its contractor, (f) if any one of the workmen has not been provided employment so far after the order of the learned Single Judge, the employer shall provide them the employment if they report for duty”. Eventually, on 05.11.1998, the following Notification was passed.

“NOTIFICATION

No. S.O. IN exercise of the powers conferred by sub-section (1) of Section 10 of the Contract Labour (Regulation and Abolition) Act, 1970 (37 of 1970), the Central Government after consultation with the Central Advisory Contract Labour Board, hereby prohibits the employment of contract labour in the jobs specified in the Schedule annexed hereto in the Aeronautical development Agency, the National Aeronautical Laboratory Campus, Belur, Bangalore.

SCHEDULE:

1. Helpers;

2. Messangers;

3. Attenders; and

4.Despatach Clerks.

Sd/xx

(S D Das)

Director General (Labour Welfare)

Joint Secretary to the Government of India

(File No.U-23013/30/07-LW)”

Obviously, a copy of this notification was not conveyed to the petitioners leading them to file contempt petitions, which were disposed of by the Division Bench by orders dated 07.12.1998. The Notification dated 05.10.1998, having been placed on record, those contempt petitions were dismissed as withdrawn, “with liberty to the complainants or any other workmen to approach the Court afresh, if they feel that the directions with respect to their absorption and regularization have not been complied with.”

8. The obdurate if not recalcitrant/refusal of the appellants to abide by the orders of the Division Bench constrained the writ petitioners to file the second salvo of writ petitions on which the impugned orders dated 18.03.2005 came to be passed. The learned Single Judge has interalia, found that a) the attempt of the appellants ‘clearly establishes that there are vacancies in ADA to absorb the petitioners; (b) that during the years 1985-1989, the petitioners were appointed on daily wages and they continued in service till their termination on 02.03.1999 after 14 to 15 years services with the appellants. The learned Single Judge thereafter concluded that the petitioners were entitled for absorption that their termination by the appellants was illegal. The learned Single Judge thereafter directed the appellants to absorb the petitioners. Therefore, even if the pronouncements relating to the first two categories of employment discussed above are applied, it is manifestly clear that the impugned order does not direct the creation of any posts or the regularization of the petitioners. The impugned order merely ordains the continuance of the status-quo-ante. As we have already noted above, it is not the case of the appellants that the recruitments of the petitioners at its inception was contrary to any rules and regulations. On the contrary it is evident that in 1985, the appellants were setting up their establishment, and therefore, engaged the services of the petitioners in menial or ministerial duties. Here was no infraction of any rules, no back-door entry, no nepotism and no bribery or corruption in the engagement of their services. The petitioners immediately approached the Court when their services were sought to be altered into contract labour and their services continued for several years thereafter. Eventually, the Central Government recommended the discontinuance of the so-called contract labour arrangement which was unilaterally adopted by the appellants and arbitrarily thrust upon the petitioners. We find no error in the impugned order. Accordingly, the applies filed by the Aeronautical Development Agency are dismissed with costs of Rs.10,000/-, payable to each of the respondents-employees who were represented before us. The appeals filed by the respondents employees also stand dismissed.