PUNJAB STATE WAREHOUSING CORPN., CHANDIGARH versus MANMOHAN SINGH AND ANR.

Citation: [2007] 2 S.C.R. 933 · Decided: 20-02-2007 · Supreme Court of India · Bench: S.B. SINHA · Disposal: Appeal(s) allowed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

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PUNJAB STATE WAREHOUSING CORPN., CHANDIGARH 
A 
v. 
MANMOHAN SINGH AND ANR. 
FEBRUARY 20, 2007 
(S.B. SINHA AND MARKANDEY KA TJU, JJ.] 
B 
----,( 
Service Law-Regularization-scheme for regularization by State 
Government-Contract employee of statutory Authority Termination of 
services-Challenged-Direction by High Court to employer to consider the c 
case of employee in the backdrop of the Scheme-Employee denying 
-:. 
regularization on the ground that Scheme not applicable to the contract 
employee-Denial of regularization set aside by High Court-On appeal, 
held: Employee not entitled to regularization under the Scheme-The terms 
and conditions of the employees of the employer was governed by statutory D 
rules-Scheme of the State could not have been extended to the Statutory 
'1' 
Corporation-Constitution of India, 1950-Article 309 and 162-Policy 
decision. 
j 
State Government formulated a Scheme for regularization of services 
of its employees. Respondent No. 1 was appointed with the appellant on contract E 
basis pursuant to interim order passed by this Court. His services were 
extended from time to time. Subsequently the contract was not renewed, and 
the services were terminated. The termination order was questioned in Writ 
Petition. The Writ Petition was disposed of directing the appellant to consider 
the case of respondent No. 1 in the backdrop of the Scheme of the State F 
--1 
Government. Appellant rejected the claim of regularization in view of the 
; 
clarification issued by the State Government that the Scheme was not 
applicable to the case of contract employees. Thereagainst respondent filed 
another Writ Petition and the same was allowed by High Court. Hence the 
present appeal. 
G 
,. 
Allowing the appeal, the Court 
f 
..;_. 
HELD: 1. The scheme for regularization of the State was not made in 
terms of Article 162 of the Constitution oflndia. It was by way ofa Circular 
letter dated 23.01.2001. The State, without issuing any notification or without 
even exercising its statutory power governing the constitution and functioning H 
933 
+ 
934 
SUPREME COURT REPORTS 
[2007] 2 S.C.R. 
,. 
A of the ~tatutory authorities like the appellant, sought to extend the same to 
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Public Sector Undertakings, corporations, boards, local authorities and other 
_, 
autonomous bodies which it could not do in law. I Para 8] 1936-E-FI 
2. It is not the case of the parties hereto that Respondent No. 1 was 
B 
appointed upon compliance of the constitutional scheme as adumbrated in 
Articles 14 and 16 of the Constitution of India. It is also not the ca~e of the 
respondent that prior to his appointment either any advertisement was issued 
or even the Employment Exchange was notified in regard to the then existing 
vacancies. It is also not known whether there existed a sanctioned post. It is 
furthermore neither in doubt nor in dispute that the terms and conditions of 
r-
....... 
c the services of the employees of the appellant - Corporation which is a body 
constituted and governed under the Punjab Warehousing Corporation Act, 
1957 are governed by the provisions thereof and the rules framed thereunder. 
[Para 10] 1937-B-D] 
,.... 
D 
3. The terms and conditions of employees of the appellant - Corporation 
being governed by a statute and statutory rules could have been altered only 
by reason of amendment of the rules only. The State had no say in that behalf. 
A policy made by a State would ordinarily apply only in respect of the employees 
r 
working under it. The policy decision of a State cannot be extended to a 
statutory Corporation unless it is permitted to do so by the statute. jPara 11] 
E 
'. 
Pawc:.n Alloys and Casting Pvt. Ltd., Meerut v. U.P. State Electricity 
Board and Ors., 11997] 7 SCC 251, referred to. 
4. When the terms and conditions of the services of an employee are 
govenied by the rules made under a statute or the proviso appended to Article 
F 309 of the Constitution of India, laying down the mode and manner in which 
the recruitment would be given effect to, even no order under Article 162 of 
t· 
the Constitution of India can be made by way of alterations or amendments of 
the said rules. A'fortiori if the recruitment rules could not be amended even 
by issuing a notification under Article 162 of the Constitution of India; the 
G same cannot be done by way of a Circular letter. (Para 12] [937-G-HI 
Secretary, State of Karnataka & Ors. v. Umadevi and Ors., 120061 4 SCC 
' 
1, followed. 

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