Some Thoughts on the Plight of the Auction Purchaser in Execution

(By K.G. Balasubramanian, Advocate, High Court  Kerala)

2021 (1) KLT 631 (F.B.) - Danish Varghese v. Jancy Danish –and some ensuing dialogues inflamed a thought I had abandoned long ago because there was no purpose in flogging a dead horse. Has “Danish” rejuvenated that horse? No, I would like to think. I would console myself that some observations in “Danish” do not constitute ratio decidendi, but obiter dicta.

It was held in A.S.K. Krishnappa Chettiar v. S.V.V. Somiah(1963 KLT OnLine 1284 (SC) = AIR 1964 SC 227) that “The Limitation Act is a consolidating and amending statute relating to the limitation of suits, appeals and certain types of applications to courts and must, therefore, be regarded as an exhaustive Code. It is a piece of adjective or procedural law and not of substantive law.Rules of procedure, whatever they may be, are to be applied only to matters to which they are made applicable by the legislature expressly or by necessary implication. They cannot be extended by analogy or reference to proceedings to which they do not expressly apply or could be said to apply by necessary implication. It would, therefore, not be correct to apply any of the provisions of the Limitation Act to matters which do not strictly fall within the purview of those provisions. Thus for instance, period of limitation for various kinds of suits, appeals and applications are prescribed in the First Schedule. A proceeding which does not fall under any of the articles in that schedule could not be said to be barred by time on the analogy of a matter which is governed by a particular article.”

In N. Balakrishnan v. V.M.Krishnamurthy (1998 (2) KLT OnLine 1238 (SC) =(1998) 7 SCC 123), their lordships opined that “Rules of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts.So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy”.

The conflict between substantive and procedural provisions was sought to be resolved in Saiyad Mohammad Bakar El-Edroos v. Abdulhabib Hasan Arab (1998 (1) KLT OnLine 1168 (SC) = (1998) 4 SCC 343 : AIR 1998 SC 1624) in the following words: “A procedural law is always in aid of justice, not in contradiction or to defeat the very object which is sought to be achieved. A procedural law is always subservient to the substantive law. Nothing can be given by a procedural law what is not sought to be given by a substantive law and nothing can be taken away by the procedural law what is given by the substantive law”.

In the matter of powers of execution court, Kassim Rawther v. Mytheen Beevi (1988 (2) KLT 812: 1988 (2) KLJ 922) lays down that ‘The non obstante clause incorporated in the said Rule with the words “notwithstanding anything to the contrary contained in any other law for the time being in force” apparently excludes operation of the provisions of all other statutes including S.125 of the KLR. Act. With the words “be deemed to have jurisdiction” a legal fiction is made and jurisdiction is re-conferred on the civil court to decide all questions including questions relating to right, title or interest in the property in the special circumstances envisaged in R.97 and 99 of O.21. C.P.C. (Amendment) Act 104 of 1976 came into force as early as 1.2.1977. The Land Reforms Act came into force as early as 1.1.1970. Parliament by incorporating R.101, as it stands now with the non obstante clause as wide as it is, must be presumed to be aware of all the existing statutes. The object of incorporating R.101 is to clothe the execution court with jurisdiction to decide all questions relating to “the right, title and interest in the property”. The Committee which piloted the amendment to the Code felt that absence of jurisdiction, pecuniary or otherwise, to decide the questions of right, title or interest in the property may lead to further delay in disposal of execution matters. It was hence recommended that execution court should be clothed with jurisdiction to decide all such questions so that such questions may be heard and finally decided by the execution court itself. It was to facilitate the aforesaid object that R.101 with a widely worded non obstante clause had been incorporated by Parliament in the Code. When the object of the amendment is thus understood, the later enactment has the effect of superseding the provision in the earlier enactment through the non obstante clause in such cases where R.101 applies’. [I do have some strong reservations about this ratio].

Ganpat Singh (Dead) By Lrs. v. Kailash Shankar & Ors.(1987 (1) KLT OnLine 1057 (SC) =(AIR 1987 SC 1443:1987 SCR (3) 355) has laid down that “It may be that before the amendment of S. 47 of the Code, an auction purchaser could file a suit for recovery of possession of the property within 12 years from the date of sale, but in view of the amendment of S. 47 of the Code such a suit cannot be filed.But that is no ground for holding that Art. 136, Limitation Act, would apply to an application for delivery of possession. Under the old Limitation Act of 1908, an application for delivery of possession could be made within three years from the date on which sale became absolute as prescribed by Art. 180 of that Act, but under Art. 134, Limitation Act, 1963 such an application can be made within one year from the date on which sale became absolute. ----------------- We would, accordingly, hold that Art. 134 will apply to an application under O. 21 R. 95 Civil P.C. by the auction purchaser for delivery of possession of the property sold in execution of a decree”.

Bengal Immunity Co. Ltd. v. State of Bihar(1955 KLT OnLine 1007 (SC) =AIR 1955 SC 661) laid down that “One application of this rule is that when there is a law generally dealing with a subject and another dealing particularly with one of the topics comprised therein, the general law is to be construed as yielding to the special in respect of the matters comprised therein. Now, the reason of the rule requires that it should apply whenever there is overlapping of the fields occupied by two conflicting enactment’s, and when that is shown, it would not be logical to exclude its application on the ground that the enactment’s have been made with a different purpose. It is the identity of the subject matter of the conflicting provisions, not the identity, of their purpose or angle of vision that is essential for the application of the maxim.”

In Kochunni Kartha & Others v. State & Others (1961 KLT 84: 1961 KLJ 103), it was held that “It cannot, however, be disputed that where the provisions of the later Act be so inconsistent with and repugnant to the provisions of an earlier Act that the two cannot stand together repeal by necessary implication takes place. Craies on Statute [Fifth Edn. at p. 352) states this legal position in these words: And if a special enactment, whether it be in a public or a private Act, and a subsequent general Act are absolutely repugnant and inconsistent with one another, the Courts have no alternative but to declare the prior special enactment repealed by the subsequent general Act.”

C.P.C. provided for some fresh suits in certain situations vide Order XXI Rule 63. Article 65c would have had relevance to such suits. That lost steam after 1976.Quaere. In other words, Article 65c stands impliedly repealed by amendment to Section 47 and Order XXI C.P.C. in 1976. It is well neigh impossible to find a suit that is not barred under section 47.

Following Noorduddin v. K.L. Anand (1994 (2) KLT OnLine 1134 (SC) = 1995 (1) SCC 242) and some other precedents, a division bench answered the question in Unnikrishnan v. Kunhibeevi 2011 (1) KLT 508 thus: “So what we notice from the catena of decisions referred to above, rendered by the Apex Court, is that by virtue of the Amendment Act, 1976, a sea change with respect to the resolving of disputes over the executability of a decree for possession has taken place after the amendment Act of 1976 to the Code, by which the provisions covered by R.97 to 103 of O.21 of the Code lay down the scheme for adjudication of all disputes over the right, title and interest of any person over the property covered by the decree, and once the execution has commenced the execution Court alone can consider such disputes and it, cannot be agitated by a separate suit. Even if a suit is entertained challenging a decree for possession of property before commencement of the execution proceedings of such decree, the scheme covered by the provisions of R.97 to 103 of O.21 after the amendment spells out that if the execution of that decree has culminated in a Court sale of the property or the plaintiff in that suit has already been dispossessed, the claim raised over the property has to be adjudicated only by the execution Court and not by any other Court”. This decision does not appear to have been brought to the notice of their lordships in “Danish”.

The Limitation Act does not generally create a positive right to property, but only bars the remedy to enforce an existing right. If a suit is barred u/S.47, it cannot be enforced only because of Article 65c. Prima facie, any such suit will be a misconceived hardscrabble. The amendment to Section 47 and Order XXI C.P.C. is to ensure that the system is not haunted by revenants. The observation in “Danish” that “suits which do not offend S.47 C.P.C. and suits for possession on the strength of title deed including purchase certificate that fall within the frame work of Article 65 of Limitation Act would be maintainable” may cause unworthy causes to be rekindled.

Tail piece: A few situations contemplated by some articles in the Limitation Act have become either otiose or irrelevant in civil courts by passage of time and change in law. Is it not high time to eschew obsolete intricacies and prescribe 3 years period of limitation for filing of many suits instead of different articles prescribing same period of limitation?

Perpetual Injunctions -- A Misconcieved Oxymoron !

(By Anoop Bhaskar, Advocate, Thiruvananthapuram)

“How can you ask for a perpetual injunction for a specific period of time? Don’t you know that perpetual injunctions are permanent injunctions and they cannot be granted for a limited point of time. Learn the fundamentals of temporary and permanent injunction. Counsel your suit won’t stand !”

If not to all, these court room comments might appear legitimate to at least a good number of people among the legal community. Here let us try to understand its correctness by decoding the true meaning of Perpetual injunctions. The larger question sought to be addressed is whether injunctions, as a matter of fact, can ever be permanent or perpetual? Yet another rhetorical question that is beneficial to pose is, “Are all permanent injunctions temporary?”.¹

Injunctions, as known, are preventive reliefs granted by the Courts to protect a legal right. Originally these were common law rights, which later found its way to the statute books.²However they are still guided by equitable principles and completely fall within the realm of discretionary prerogative of the Courts. Injunctions are broadly classified into Temporary and Permanent injunctions. The classification is done with reference to the stage in the lis at which it is granted. Then based on the nature or character of injunctions, it is further termed as Prohibitory or Mandatory injunctions. It is the former classification which needs to be reflected for answering the questions mentioned above.

So when injunctions are granted at a preliminary stage of a case or before finally adjudicating the rights of parties, we call them temporary injunctions.³ This category of injunctions is very often referred to as ‘ad-interim’, ‘interlocutory’ and ‘pendente lite’. Those injunctions granted at the conclusion of a case after deciding the merits of a dispute belong to the second category and are named as Permanent or Perpetual injunctions. The prefix ‘permanent’ and ‘perpetual’ attached to these injunctions paint a picture of an eternal relief that lasts forever. This is just an illusory perception which waters down the reasoning attached to the classification of injunctions based on the stage at which it is granted by the Court. Instead one should decipher the words ‘permanent’ and ‘perpetual’ to mean ‘final’ when used in the context of perpetual or permanent injunction.

Apart from the literal comprehension of the term perpetual, another reason for this confusion lies within the framework of Section 37 of the Specific Relief Act, 1963 which reads as:

37. Temporary and perpetual injunctions. — (1) Temporary injunctions are such as are to continue until a specific time, or until the further order of the court, and they may be granted at any stage of a suit, and are regulated by the Code of Civil Procedure, 1908 (5 of 1908).

(2) A perpetual injunction can only be granted by the decree made at the hearing and upon the merits of the suit; the defendant is thereby perpetually enjoined from the assertion of a right, or from the commission of an act, which would be contrary to the rights of the plaintiff.

From a reading of these provisions it is seen that both the injunctions are explained under two heads. One being the stage of a suit at which it is granted and the other being the tenure for which it lasts. The former distinction is succinct and needs no further clarification. But the second distinction provides scope for some confusion. Let us see how.

When we look at the explanation given for temporary injunctions, emphasis is placed on the period for which it lasts. It expressly says such injunctions continue until a specific time or until further orders. Now when we move to perpetual injunctions, it goes on to state that the defendant is perpetually enjoined from the assertion of a right or from the commission of an act. So at the first blush, one would get an impression that perpetual injunctions are perpetual or permanent in nature which continues to run for an indefinite period of time. This happens when we fail to give due weightage to the concluding portion of the Section, which reads as, “which would be contrary to the rights of the plaintiff.”. One should not forget that the perpetuity of a perpetual injunction is tied to the rights of a party. In short, a perpetual injunction will only continue to restrain the defendant from asserting a right or committing an act against the plaintiff until the plaintiff enjoys certain rights. Therefore the distinction of temporary and prohibitory injunction with reference to its tenure does not confer perpetuity or permanency to the latter class of injunctions in its literal sense.

For instance, when a licensee faces a threat of trespass in contravention to the terms of licence or disturbance to his peaceful occupation by the licensor, he may institute a suit for a permanent prohibitory injunction restraining such acts. But is he entitled for such a decree of perpetual injunction for an indefinite period of time? What if the licensor acquires the right to enter that property by way of a subsequent contract or due to the expiry of licence period or due to revocation of licence? So in such cases, is it wrong for the licensee to seek a decree of perpetual injunction until that particular period or until he chooses to exercise his rights against the licensor? To give a closure to such potential questions, it is suggested that the relief in a suit for a permanent prohibitory injunction should specify in clear terms, the period for which it should operate, rather than leaving it open ended which will create an impression of ‘forever’. For example, in a set of facts wherein the licensor is denied entry into the licensed premises, a prayer for perpetual injunction restraining the defendant from trespassing into the plaint schedule property until the expiry of licence or until the plaintiff chooses to remain in occupation of the property is legally more sound instead of seeking a blanket decree of permanent injunction restraining the defendant from trespassing into the plaint schedule property. It may be argued that technically such a course need not be resorted, as the rights are pleaded in the body of the plaint and they get adjudicated to be set out in the judgement. However such a practice only renders complete justice to the statutory mandate under Section 37(2) of the Act and Order VII Rule 7 of C.P.C.⁴ and the jurisprudential principle on which it rests.

To conclude by disregarding the jurisprudence underlying the remedy of injunctions will cause to leave a hole in this attempt to find an answer to the question involved here. So when we trace its jurisprudence it will lead us to understand that injunction is a remedy in-personam. It is a remedy available to a person against another person. One cannot assert an injunctive relief against the world at large, leave apart ‘Gag Orders’⁵ or ‘John Doe Orders’⁶ that have evolved as modern day injunctive reliefs. Thus an order of injunction emanates from a person’s rights and ends with him or his rights or with the person against whom he asserts those rights. This should mean that all permanent injunctions are nothing but temporary! There is no magic in the term perpetual injunction which elevates it to an eternal status. The result of these deliberations will lead us to invariably conclude that no injunctions can ever be perpetual or permanent irrespective of the epithet associated with perpetual injunctions and one can always call the phrase “perpetual injunction” as a misnomer or a misconceived oxymoron!

Foot Note

1.See Note, Are all permanent injunctions temporary, Michigan Law Review, Vol.23, No.4
(Feb., 1925), pp.382-385.

2.Part III of the Specific Relief Act, 1963; Section 94 and Order XXXIX of the Code of Civil
Procedure, 1908; Section 35 of the Indian Easements Act, 1882 etc.

3.As an exception, Order XXXIX Rule 2 provides for a temporary injunction to be granted after judgement for a limited duration.

4.Order VII Rule 7: “ Relief   to be specifically stated - Every plaint shall state specifically the relief  which the plaintiff claims………….”

5.   Orders prohibiting disclosure of information to the public by media or any person. Orders directed against persons or class of persons who cannot be identified.

Selection, Extension, Conformation & Termination of A Probationer

 Advocate H.L. Kumar

The period of probation furnishes a valuable opportunity to the employer to closely observe the work of the probationer and by the time the period of probation expires, to make up his mind whether to retain him/her by absorbing him/her in regular service or to dispense with the service. Period of probation may vary hence it is obligatory on the employer to prescribe a period of probation.

The expression ‘probationer’, its extension, confirmation or termination has given rise to a large number of judgments either of Supreme Court or High Courts. Certain ambiguities are clarified by interpreting the expression ‘probationer’ depending upon the given facts but sometime such interpretations have led to more controversies hence resulting into large number of cases arising again and again for judicial interpretations.

The term ‘probationer’ is nowhere defined in any statute pertaining to labour matters except that clause (c) Order 2 of ‘Model Standing Orders in respect of Industrial Establishments not being Industrial Establishment in Coal Mines’ which provides as under:

“A ‘probationer’ is a workman who is provisionally employed to fill a permanent vacancy in a post and has not completed three months’ service therein. If a permanent employee is employed as a probationer in a new post he may, at any time during the probationary period of three months, be reverted to his old permanent post.”

It is pertinent to make reference to the fundamental judicial pronouncements pertaining to the status of a probationer. In a landmark judgment, the Constitution Bench of the Supreme Court1 has held the status of a probationer and his termination from service as reproduced below:

“The period e.g., for six months or for one year or it may be expressed simply as ‘on probation’ without any specification of any period. Such an employment on probation, under the ordinary law of master and servant, comes to an end if during or at the end of the probation, the servant so appointed on trial is found unsuitable and his service is terminated by a notice.”

The Supreme Court and High Courts have relied upon the above landmark judgment by holding that the object in engaging a probationer is to test his performance and the employer can terminate his service if found unsatisfactory.²

It is thus pertinent that the employer must incorporate the probation clause in the appointment letter by adopting the following language :

In the first instance you will be on probation for a period of ……. from the date of your joining, where after the probation period may be either extended at the discretion of the management or may be dispensed with either earlier or on completion or thereafter till confirmation. Unless confirmed in writing, you will be deemed as probationer after the expiry of the initial or extended period of probation. Your services are liable to be terminated without any notice or wages in lieu thereof during the initial or extended period of probation.

As regard to period of probation, if the employer has certified standing orders, there should not be conflict between the standing orders and the appointment letter particularly about period of probation since the terms and conditions of employment in the certified standing orders cannot be more than as contained in standing orders. For instance if the certified standing orders provide that the services of a worker cannot be retained on probation for more than six months whereas the appointment letter provides probation period nine months and if the probationary services of an employee are terminated after six months the termination will be illegal.³

The Allahabad High Court has held that when the terms and conditions of service in appointment letter are inconsistent with standing orders, the latter will prevail.⁴

EXTENSION OF PROBATION PERIOD

In the light of the conditions which had been specified even in the letter of appointment and in as much as the probation was not extended subsequently, it cannot be said that there is any deemed confirmation in this regard. This view taken by court is in consonance with the Standing Orders of the Management and also the consistent view expressed by the Apex Court in several decisions.⁵

If an employee did not question her first or second extensions, she is not entitled to challenge the consequences of her poor assessment at belated stage at the time of termination of her services on account of unsatisfactory performance. Even if an order of termination simpliciter brings on record some preliminary enquiry regarding allegations against the probationer, that will not vitiate order of termination. The appointing authority is entitled to look into any complaint made in respect of the probationer while making assessment of his performance regarding his confirmation.⁶

CONFIRMATION OF A PROBATIONER

In the absence of rules, if the contract of employment has fixed a particular period of probation and on expiry of the said period, the employee still continues in service, then the implications are that he continues as a probationer. This amounts to an implied extension of the probation period. Otherwise, it is well settled that a probationer continues to be on probation until he is confirmed.⁷ A probationer can be terminated from his services any time before confirmation provided that such termination is not stigmatic.⁸ Confirmation of a probationer will not be deemed till a specific confirmation order is received by him.⁹ Extension of probation period means performance not upto the mark.¹⁰ Even when a person is continuing beyond the probationary period of any order, he does not become a permanent employee.¹¹

Also, in the absence of ceiling about the period of probation, a probationer remains on probation even after period of probation, as held by Delhi High Court.¹² The absence of any provision for extension of the period of probation in the terms and conditions of service, does not necessarily mean that the Government has no powers to extend the period. An employer, has always an implied right to extend the probation period till it is satisfied that the probationer is fit for confirmation.¹³ In another case, a Bench of the Apex Court has held that by continuation in service after expiry of the probation period, a probationer cannot be deemed to be confirmed.¹⁴

The Delhi High Court has also followed the above judgment in holding that there is no right in the probationer to be confirmed merely because he had completed the period of probation.¹⁵

Even when a probationer has crossed the specified period of probation, he will not be deemed to be confirmed and as such his termination after the expiry of the probation period will neither be unjustified nor illegal, particularly when no maximum period of probation has been prescribed.¹⁶

TERMINATION OF A PROBATIONER

It is now well settled principle of law that the appointment made on probation/ad-hoc basis for a specific period of time comes to an end by efflux of time and the person can have no right to continue on the post.¹⁷ Termination of service before expiry of the extended period of probation will neither be stigmatic nor punitive. However, the services of a probationer can be terminated even during the probation period but if it is sought to be terminated on the basis of misconduct, then reasons for unsatisfactory performance are to be recorded.¹⁸ Even if an order of termination of a probationer refers to unsatisfactory service of the person concerned, the same cannot be said to be stigmatic.¹⁹ The Supreme Court has held that the termination of a probationer on account of unsatisfactory performance can never be treated as ‘penal’.²⁰

In one case, the Gujarat High Court has held that the Industrial Tribunal has rightly rejected the dispute of the probationer alleging violation of the principles of natural justice whereas even during the probation period, his performance remained unsatisfactory.²¹ The Supreme Court has observed if the order of termination indicates that it is a termination simpliciter and does not cast any stigma on the employee, the mere fact that there was an enquiry into his conduct earlier would not, by itself, render the termination invalid.²² The Division Bench of Kerala High Court has held that when there has been sufficient material about the unsatisfactory performance of the petitioner during his probation period and also in the absence of any malafide by the employer, he was justified in terminating his services.²³

Termination of a probationer for unsatisfactory performance cannot be termed as stigmatic or based on Court will not interfere with such findings in the writ.²⁴ As summarily recording, unsatisfactory performance of the probationer during the probation period by the Management will not render the termination of the probationer as illegal.²⁵ Mentioning unsatisfactory work in the order of termination of a probationer, will not amount to stigmatic or invalid.26 Merely that the order of termination of a probationer states that his work is not satisfactory though stigmatic but the termination will not be vitiated and also it will not be violative of the Rules.²⁷

Termination of a probationer by a notice stating that her services were unsatisfactory since she was not a proper performer and lack punctuality would be treated as illegal since it has been stigmatic and no enquiry was held more so when the employee has worked for more than 240 days.²⁸

Termination of probationary services of an employee is not illegal until the termination order is having some stigmatic basis of termination. The words “unsatisfactory performance/work”, “lack of efficiency”, “Unsuitable”, does not ipso facto become stigmatic. While terminating services of a probationer, neither any notice is required to be given to the employee nor any opportunity of hearing until such a stipulation is there in the service contract. Services of a probationer can be terminated at any time before confirmation provided that the same is not stigmatic. Law is well settled that it is the employer who decides whether or not probationary services of an employee are or are not satisfactory for the employer. Court cannot substitute its decision with that of the competent authority/employer that his probationary services are or are not satisfactory.²⁹

Probationary services of an employee can be terminated without assigning any reason. Whether or not a probationary employees’ services are satisfactory or not, it is for the employer to decide and the Court cannot substitute its view for that of the employer.³⁰

Probationary services can be terminated without assigning any reason as held by Delhi High Court.³¹

Non-issuance of formal letter of extension of probation period, mere completion of probation period or completion of probation would not lead to ‘automatic conformation’.³²

LANGUAGE OF THE ORDER OF TERMINATION

In one case, the question arose as to whether language used for termination of probationer will be stigmatic and, if so, whether holding of enquiry by the employer was imperative. On terminating the services of a probationer the language of the order was as under:

On a dispute raised by the employee, in a reference for adjudication, the Labour Court declined to give any relief. The employee filed a writ petition. The Delhi High Court held that the language used by the employer e.g. performance not found upto expectation does not cast any aspersion.³³ Reliance was placed on the judgment of Supreme Court wherein the language used in the termination order has been ‘work and conduct has not been found to be satisfactory’, it safely be held that the impugned order is exfacie not stigmatic.³⁴

Notwithstanding above, it is advisable that while terminating the services of a probationer, the language should be simple, unambiguous and non-stigmatic. It will be appropriate to state :-

“In accordance with the terms and conditions of the appointment letter dated........., the probationary services are terminated with immediate effect or w.e.f………. as the case may be.”

Foot Notes :

1. Parshotam Lal Dhingra vs. UOI, 1958 (1) LLJ 544 (SC) : AIR 1958 SC 36.

2. National Small Industries Corporation Ltd. vs. M. Narayanan, 2005 LLR 967 (Ker. HC).

3. Uttar Pradesh Cooperative Spinning Mills Ltd., Etawah vs. State of Uttar Pradesh, 1978 Lab. IC 1137 (All. HC).

4. R.P. Garg vs. Indian Oil Corporation Ltd., 2007 LLR 247 (All. HC).

5. K. Dasarath vs. Labour Court-I, Andhra Pradesh, Hyderabad and another, 2002 LLR 945 (AP HC).

6. Saraswati vs. Press Trust of India & Anr., 2016 LLR 340 (Del. HC).

7. Express Newspapers (Pvt.) Ltd. vs. Presiding Officer Labour Court, AIR 1964 SC 806 : 1964 (1) LLJ 9.

8. Jaya Raina vs. Gujarat Livelihood Promotion Company Ltd., 2015 LLR 193 (Guj. HC).

9. Hamdard Public School vs. Director of Education, 2013 LLR (SN) 1115 (Del. HC).

10. National Board of Examinations vs. Ms. Rajni Bajaj, 2012 LLR 450 (Del. HC).

11. Motilal Khairati Lal Sharma vs. The Union of India, 1973 (6) Lab. IC 56 (Raj. HC).

12. Sita World Travel (India) Pvt. Ltd. vs. Presiding Officer Labour Court No.4 Delhi & Ors., 1996 LLR 627 (Del. HC).

13. Madan Lal Anand vs. Himachal Pradesh Government and Others, 1971 (4) Lab.IC 277 (Del. HC).

14. Dhanjibhai Ramjibhai vs. State of Gujarat, 1985 (51) FLR 77 (SC).

15. K.C. Mangia vs. Central Warehousing Corporation and Ors., 1987 (55) FLR 67 (Del. HC).

16. Vasant C. Handhad vs. Chairman, Oriental Insurance Co. Ltd., 2004 LLR 372 (Guj. HC).

17. Vidya Vardhaka Sangha and another vs. Y.D. Deshpande and others, 2006 LLR 1233 (SC)

18. Manjit Singh Bawa vs. Food Corporation of India and Ors., 2007 LLR 715 (Cal. HC)

19. Chaitanya Prakash & Anr. vs. H. Omkarappa, 2010 LLR 225 (SC)

20. Paramjit Singh vs. Director, Public Instructions & Ors., 2010 LLR 116 (SC)

21. Vasant C. Hanhad vs. Chairman, Oriental Insurance Co. Ltd., 2004 LLR 372 (Guj. HC).

22. Municipal Committee, Sirsa vs. Munshi Ram, 2005 LLR 317 (SC).

23. The National Small Industries Corpn. Ltd. and Others vs. M. Narayanan, 2005 LLR 967 (Ker. HC).

24. Smita Paul vs. Principal, St. Anthony’s Sr. Sec. School & Anr., 2006 LLR 147 (Del. HC).

25. Manjit Singh Bawa vs. Food Corporation of India and Ors., 2007 LLR 715 (Cal. HC).

26. Pinaki Ghosh vs. International Airport Authority of India & Ors., 2007 LLR 1238 (Del. HC).

27. Miss. Manju Shikdar vs. General Manager (Planning and Development) State Bank of Indore and Ors, 2008 LLR 752 (All. HC).

28. Wika Instruments India Pvt. Ltd., Pune vs. Swati U. Nowgaonkar (Mrs.), Pune, 2016 LLR 209 (Bom. HC)

29. Gurvinder Singh Saini vs. Director of Education and Others, 2017 LLR 130 (Del. HC).

30. St. Thomas School vs. Manish Kaushik & Anr., 2017 LLR 571 (Del. HC)

31. St. Thomas School vs. Manish Kaushik, 2017 LLR 571 (Del. HC).

32. Himanshu Bhatt vs. Indian Railway Catering and Tourism Corporation Ltd. and Ors., 2014 LLR 103 (Del. HC).

33. Davinder Arora vs. Management of Albert and David Ltd. & Anr., 2002 LLR 612 (Del. HC).

34. Pavendra Narain Varma vs. Sanjay Gandhi PGI of Medical Sciences & Anr., 2001 (8) Supreme 409 : 2002 LR 113 (SC).

SUPREME COURT STRIKES DOWN 97TH CONSTITUTIONAL AMENDMENT ON CO-OPERATIVES

– REFLECTION AND REFRACTION

R. Muralidharan

The Supreme Court in Union of India vs. Rajendra N Shah and another, C.A. Nos. 9108-9109 of 2014 : LL 2021 SC 3112 nixes most of the provisions introduced by 97th Constitutional Amendment Act (97th CAA) on the ground that the requisite ratification from States was not obtained as per Article 368(2) of the Constitution.

A 3-Judge Bench comprising Justices Rohinton Nariman, KM Joseph and BR Gavai dismissed the appeals filed by the Union of India against the judgment of the Gujarat High Court. The Bench unanimously held that the 97th CAA required ratification by at least one-half of the State legislatures as per Article 368(2) of the Constitution, since it dealt with an entry which was an exclusive State subject (co-operative societies). Since such ratification was not done in the case of the 97th CAA, it was liable to be struck down. There was a split in the Bench on the point whether Part IX B will survive with respect to Multi-State Co-operative Societies (MSCS). While the majority comprising Justices Nariman and Gavai upheld those provisions of Part IX B which deal with Multi-State Co-operative Societies (MSCS) by applying the doctrine of severability, Justice Joseph dissented on this count. Justice Joseph held that the doctrine of severability was not applicable and struck down the entire amendment.

What is 97th CAA?

The Constitution [97th Amendment] Act, 2011 was passed by the Lok Sabha on 22nd December 2011 and the same was passed by the Rajya Sabha on 28th December 2011. The President of India bestowed assent to that amendment on 12th January 2012 and the said notification was published in the gazette of India of 13th January 2012 and the amendment came into force on 15th February 2012. This was hailed and applauded as it would insulate about six lakh co-operative societies from political and Government interference and to strengthen the co-operative movement, per se.  The amendment would grant citizens a fundamental right to form co-operative societies and allow for voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies.

Section 2 of the Amendment Act inserted the word 'co-operative societies' to Article 19(1)(c) which reads that all citizens shall have the right to form associations or unions or co-operative societies. Also the amendment introduced Article 43B (in Directive Principles of State Policy) which says that States shall endeavour to promote voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies.

The amendment was inserted as Part IX B of the Constitution and contained Articles 243 ZH to 243 ZT.  The States and Union territories were given time of one year to amend their respective States Act in tune with the 97th CAA as Art. 243 ZT prescribed that any provision inconsistent to the provisions of the 97th Amendment Act shall continue to be in force until amended or repealed by the State Legislature or until expiration of one year from such commencement, whichever is less.

A writ petition being W.P. (PIL) No. 166/2012 in Rajendra N Shah vs. Union of India and another [CDJ 2013 GHC 045]filed before the Division Bench of the Gujarat High Court succeeded vide the impugned judgment dated 22.4.2013, by which Part IXB was declared to beultra viresfor want of ratification by the State Legislatures under Article 368(2) proviso.

Assail on the judgment of the High Court

The essential challenge pitched by the appellant against the order of the High Court is that Part  IXB  is  in  two separate parts – one dealing with MSCS which  have  ramifications   beyond  merely  one  State,  and  co-operative societies which exist and operate within a particular State. Even though there was no challenge insofar as MSCS were concerned, the entirety of Part IXB has been struck down, throwing out the baby with the bath water.  As many as 17 out of 28 States have, after the 97th Amendment, already enacted legislative measures in conformity with Part IXB and that therefore more than half of the States had, in effect, accepted and applied the provisions of Part IXB.  What is also of significance is that the Constitution 97th Amendment was preceded by a detailed consultation with the State Governments as a  result  of  which  no  State  Government  has  come  forward  to challenge the same. In point of fact, a reading of Part IXB would show that no additional legislative power has been given to the Union.  All subject matters relating to co-operative societies fall solely within the legislative domain of the States.

If the doctrine of severability is to be applied, then in the event of the   Court finding  that  State  co-operative societies  cannot  be  impacted  without  following  ratification,  MSCS, which have ramifications beyond one State,  can  be  held  to  be  covered  by  Part  IXB,  as  would  Union territories,  and  that  on  applying  the  aforesaid  doctrine,  Part  IXB ought to be upheld, at least insofar as the MSCS are concerned.

It must never be forgotten that while inserting Part IXB into the Constitution of India, Parliament has exercised its ‘constituent’ power and not ‘legislative’ power. Parliament in its constituent capacity can deal with State subjects. Part IXB read with Article 43B enhances the basic structure of the Constitution.

Prop up by the respondents

Per contra, the respondents supported the reasoning and conclusion reached by the High Court in the impugned judgment. A careful reading of Part IXB of the Constitution would show that the unfettered power of the State legislatures prior to the amendment has now been fettered by the provisions of Part IXB in several material particulars; for example, the  fixation  of  the  maximum  number  of  directors  of  co-operative societies; the reservation provision contained in 243ZJ; the duration of the term of office of elected members of the board of co-operative societies etc., relied strongly upon Articles 243ZI and 243ZT, making it clear that there is a direct assault on Entry 32, List II of the 7th  Schedule inasmuch as after one year, all State legislations that are contrary to the provisions of Part IXB are of no effect, and that an affirmative obligation is cast upon the States to enact legislation only in accordance with the restrictions contained in Part IXB.

Even  if  17  States thereafter  amend  their  laws  in  furtherance  of  the  Constitutional Amendment,  this  would  make  no  difference  to  the  constitutional position  if  in  fact  the  requisite  ratification  under  Article  368(2) proviso is lacking.  The validity of a constitutional amendment does not depend upon whether a State Government accepts it or whether a State Government challenges it. Insofar as MSCS are concerned, MSCS  are  inextricably entwined  with  co-operative  societies  and  the  97th CAA  would  never  have  been  enacted  for  MSCS alone. If this Constitutional Amendment  is  allowed  to  pass  constitutional  muster  without ratification, there  would  be  no  end  to  further  amendments which would  then  indirectly  rob  the  States  of  their  legislative  powers, changing a quasi-federal State into a unitary one.

Analysis, Application and Adjudication – Majority View

So far as co-operative societies are concerned, it can be seen that it is entirely a matter for the States to legislate upon, being the last subject matter mentioned in Entry 32 List II. When it comes to MSCS with objects not confined to one State, the legislative power would be that of the Union of India which is contained in Entry 44 List I. Co-operative societies as a subject matter belongs wholly and exclusively to the State  legislatures  to  legislate  upon,  whereas  MSCS  i.e.,  co-operative  societies  having  objects  not confined  to  one  State  alone,  is  exclusively  within  the  ken  of Parliament.

The question that arises is as to whether this principle can be said  to  have  been  infracted  by  inserting  Part  IXB  into  the Constitution of India so that the States’ legislative powers contained in Article 246(3) read with Entry 32 List II of the 7th Schedule can be said to have been affected in a significant manner.

It is clear that the exclusive legislative power that  is  contained  in  Entry  32  List  II  has  been  significantly  and substantially  impacted  in  that  such  exclusive  power  is  now subjected to a large number of curtailments.  Indeed, Article 243ZI specifically mandates that the exclusive legislative power contained in Entry 32 List II of the State Legislature is now severely curtailed as it can only be exercised subject to the provisions of Part IXB; and further, Article 243ZT makes it clear that all State laws which do not conform  to  the  restrictions  mentioned  in  Part  IXB  automatically come  to  an  end  on  the  expiration  of  one  year  from  the commencement of the Constitution 97th  Amendment Act. Part IXB of the Constitution leads to the result  that  though  Article  246(3)  and  Entry  32,  List  II  of  the  7th Schedule have not been ‘changed’ in letter, yet the impact upon the aforesaid articles cannot be said to be insignificant. On the contrary, it is clear that by curtailing the width of Entry 32, List II of the 7th Schedule, Part IXB seeks to effect a significant change in Article 246(3) read with Entry 32 List II of the 7th  Schedule inasmuch as the State’s exclusive power to make laws with regard to the subject of co-operative  societies  is  significantly  curtailed  thereby  directly impacting  the  quasi-federal  principle  contained  therein.  Quite clearly,  therefore,  Part  IXB,  insofar  as  it  applies  to  co-operative societies  which  operate  within  a  State,  would  therefore  require ratification  under  both  sub-clauses  (b)  and  (c)  of  the  proviso  to Article 368(2) of the Constitution of India.

The appellant argued that 17 out of 28 States had enacted legislations incorporating provisions of Part IXB, and therefore, they had impliedly accepted the restrictions laid down in the said Part. This argument merits only rejection as the procedure laid down in Article 368(2) proviso requires ratification of legislatures of  one  half  of  the  States  by  resolutions  to  that  effect.  This has admittedly not been done in the present case. Also, the argument that no State has come forward to challenge the 97th CAA does not take the matter any further. When a citizen of India challenges a constitutional amendment as being procedurally infirm, it is the duty of the Court to examine such challenge on merits as  the  Constitution  of  India  is  a  national  charter  of  governance affecting persons, citizens and institutions alike.

An important argument made by the appellant that even if it be held that Part IXB is constitutionally infirm qua co-operative societies operating within a State, it would yet operate qua MSCS and in Union territories which are not States. This necessarily brings us to whether the part dealing with MSCS in Part IXB can be severed from the part dealing with co-operative societies operating only within a State.

Article 243ZR of Part IXB makes it clear that all the provisions of this  part  which  apply  to  MSCS  would apply subject to the modification that any reference to a ‘Legislature of a State, State Act or State Government’ shall be construed as a reference to ‘Parliament, Central Act or the Central Government’ respectively.  It  is  clear  that  the  scheme  qua  MSCS is separate from the scheme dealing with ‘other co-operative societies’,  Parliament  being  empowered,  so  far  as  MSCS are concerned, and the State legislatures having to make appropriate laws laying down certain matters so far as ‘other

co-operative societies’ are concerned.  The effect of Article 246ZR is as if  MSCS  are  separately  dealt  with  in  a separate  sub-chapter  contained  within  Part  IXB. There is no doubt that after severance what survives can and does stand independently and is workable. Part IXB of the Constitution of India is operative insofar as MSCS are concerned. So far as co-operative societies within a Union territory are concerned, the same infirmity  as  is  found  in  the  main  part  of  the  judgment  continues insofar  as  the  legislative  subject  ‘co-operative  societies’  is concerned  under  Entry  32  List  II.  Therefore,  for  co-operative societies  which  have  no  ramifications  outside  the  Union  territory itself, Part IXB will have no application.

The judgment of the High Court is upheld except to the extent that it strikes down the entirety of Part IXB of the Constitution of India. It is declared that Part IXB of the Constitution of India is operative only insofar as it concerns MSCS both within the various States and in the Union territories of India.

97th CAA is unconstitutional on the whole – Dissenting judgment

In this case, the provisions of Article 243ZI to 243ZQ and Article 243ZT are undoubtedly afflicted with the vice of non-compliance with the procedure, which is mandatory. Resultantly, the said provisions must be treated as still born. These provisions are void in law.  The definition clause Article 243ZH clearly would have no meaning and would cease to be workable. The only question, which, therefore, arises is  when  provisions  of  the  amendment  to  the Constitution  are  found  to  be  void,  for  the  reason that the mandate of the proviso to Article 368(2) has not  been  complied  with,  whether  the  Doctrine  of Severability  could  be  applied  to  sustain  the  other provisions,  which  may  not  require  Parliament  to follow  the  procedure  under  the  proviso to  Article 368(2).

The question boils down to this:  Are the provisions of Article 243ZR and 243ZS independent provisions and workable? Both these provisions are entirely dependent upon the provisions contained in Article 243ZI to 243ZQ. This  is  for  the  reason  that  both  these  provisions expressly provide that the ‘provisions of this part’, which  clearly  means  the  foregoing  provisions,  which are contained in Article 243ZI to 243ZQ, are to apply in regard to multistate co-operative societies and to Union  Territories  with  the  modifications,  which  are indicated  therein.  There can be application and modifications of something which exists. There cannot be either, when the elaborate provisions are to be treated as not born. It  would  appear  to  be  that these  values  were  to  apply,  across  the  board,  to co-operative  societies  born  under  laws  made  by  the State  Legislatures,  as  also,  to  those  made  by Parliament.

Once the Court has painted the relevant  provisions,  which  are  the  substantial provisions (Article 243ZI to 243ZQ), with the brush of  unconstitutionality,  rendering  those  provisions, still  born,  it  would  appear  that  the  provisions contained  in  Article  243ZR  and  Article  243ZS  would not have the crutches without which these provisions cease to be workable and are impossible to sustain. The unconstitutional part, which is to be an integral part of Article 243ZR and Article 243ZS, must continue to exist, if the provisions in question are to bear life. Unless the  provisions,  which  have  been  found unconstitutional,  are  kept  alive,  Articles  243R  and 243ZQ are plainly unworkable. The appeals are dismissed.

Relevance and Remnants of 97th CAA

The judgment of the Supreme Court is on expected lines and it was no surprise.  In fact it was expected that the Supreme Court would dismiss the appeal filed by the Union of India in limine, but the relief given in the form of applicability to MSCS by the majority of Judges was only a surprise package.

Part IXB containing Arts. 243 ZH to 243 ZT is now held invalid and unconstitutional and operative only insofar as it concerns MSCS, both within the various States and in the Union territories of India. It is clear that the other part of amendment is not disturbed by the judgment and therefore the amendment made to Art.19 enabling the right to form

co-operative societies as fundamental right and insertion of new Art. 43B providing for ‘promotion of co-operative societies’ are valid.

The Union of India has fairly conceded before the Supreme Court that inserting Part IXB is ultra vires the Constitution for want of requisite ratification under Article 368(2) proviso and this has cost the 97th CAA. Though the Government has lost the main bout, as a consolation or concession it pleaded its applicability to MSCS, which found favour of the majority of the Judges.

It is relevant to note that the applicability of the 97th CAA to at least MSCS was never argued before the Gujarat High Court and no whisper was made on the afore line of defence. For the first time it was argued before the Supreme Court and applying the doctrine of severability, the Supreme Court concurred with the Government.

If it is the intention of the Government to bring the MSCS within the ambit of the 97th CAA, the Union of India need not resorted to a complicated task of constitutional amendment and it could have been done by amending the relevant provisions of the MSCS Act without much ado.

The amendments made by various States in pursuance of the 97th CAA are not in any way disturbed, because they have the approval of the respective State Legislature and assented by the Governors. Even where the States have carried out the amendments in the light of the 97th CAA, they are now at liberty to have a re-look to the amendments and ease out the rigorous conditions, like reservations of seats in the board, supersession of board even if the society is not assisted in any way etc.

Role and Relevance of the new Ministry

The judgment of the Supreme Court has come not one day sooner than expected especially on the formation of a separate Ministry of Co-operation.  The Ministry is formed apparently with a view to giving a fillip to the co-operative movement and reforming the functioning of co-operative societies. Until now, the subject was dealt with by the Ministry of Agriculture. It administered the MSCS Act. The opposition parties cry foul on formation of the Minister of Co-operation and allege that the Ministry would transgress its limits and would encroach upon the States and will undermine the power of the State Governments over co-operatives.  This judgment is a warning bell to the Union of India to restrict its playing arena. 

Hence, a pronouncement on the scope of Parliament's power over co-operative societies translates into a pronouncement on the contours of the newly created Union Ministry of Co-operation. So, going by the Constitutional scheme as explained in the Supreme Court judgment, the executive power of the Union Ministry of Co-operation is with respect to MSCS alone.

However, the new Ministry has to play a pro-active role for the upliftment of co-operative sector.  If the States are left to their whims, there will always be reluctance in bringing co-operative flavour in societies and elections would be postponed indefinitely and the societies would continue to be with the officials of the Department.  Strict supervision like timely audit and inspection would certainly be lacking.  Irregularities in societies would not be condemned but condoned.   There is no grumbling that the reforms brought by the 97th CAA were not in the interest of the movement and as a matter of fact more rigour is needed on the reforms.  The new Ministry has the option of re-enacting the amendment with a two-thirds majority in Parliament and obtaining the ratification of not less than 50% of the State legislatures.  This is quite possible for the Union of India. The new Ministry is expected to work on it and this will be a grand opening for the Ministry.

Constitutional Dimensions of Spoils System

in Public Employment under the State

 (By O.V.Radhakrishnan, Senior Advocate, High Court of Kerala)

‘Spoils System’ known in popular parlance as ‘patronage system’ is the system of spoils-sharing.  Spoils-sharing is a system prevalent where the leaders of the ruling party considered it their exclusive right in giving public office and Government positions to its supporters, friends and relatives as a reward for their working towards victory and the exercise of such power was within their exclusive imperium.  The spoils system was a common feature in the United States during 17th and 18th Centuries. In State of Bihar v. Upendra Narayan Singh¹ the Supreme Court has referred to the despotic practice of the spoils system. It was Jefferson who implemented the spoils system to a large extent and Jackson brought it to its full development as an engine of party warfare in the United States.  A brief idea of the phenomenon of spoils system is obtained from a few observations of the Supreme Court in Upendra Narayan Singh’s case:

“The phrase ‘spoils system” was derived from the statement of Senator W.L.Marcy of New York, in a speech in the Senate in 1832.  Speaking of the New York politicians, he said: “They see nothing wrong in the rule that to the victor belong the spoils of the enemy.”  By 1840, the spoils system was widely used in local, State and Federal Governments.  As a result of this, America fell far behind other nations in civil service standards of ability and rectitude.”

“When William Henry Harrison became President in 1841, the practice of appointing political followers reached its pinnacle.  As the Government grew, a serious need for qualified workers developed.  After the Civil War, pressure started building up for reforms in recruitment to civil services.  The gross scandals of President Ulysses S.Grant’s administration lent credence to the efforts of reforms George W. Curtis, Dorman B. Eaton and Carl Schurz.  In 1871, Congress authorised the President to make regulations for appointment to public services and to constitute Civil Service Commission for that purpose.  However, this merit system ended in 1875 because the Congress failed to provide funds for the same.” “In 1881, a spurned office-seeker shot and killed President James A. Garfield.  His death provoked further public outcry for civil service reform and paved way for passage of a Bill introduced by Senator George H. Pendleton of Ohio.  His Bill became the Civil Service Act of 1883 and re-established the Civil Service Commission.  The Act rendered it unlawful to fill various federal offices by the spoils system.  Since then, much has been done to avoid the evils of the system.  Federal civil service legislation has been greatly expanded.  Many Municipalities and States have made training and experience as a condition precedent for appointment to public offices.” 

“In the territories of India ruled by Britishers also a large chunk of jobs went to the faithfuls of Britishers who were considered fit for serving British interest.”

   Spoils system was blocking the progress and excellence of administration of the Government.  The spoils system inevitably brought out incompetence and maladministration debilitating the efficient functioning and crippling effective discharge of the business of the Government. The Founding Fathers of our Constitution taking into account the menace of spoils system which fostered the evil on a large scale, placed broad-spectrum ban on spoils system in the public employment to guard against the danger of denial of equality of opportunity in matters of appointment to any office under the State.

Great safety standards are constitutionally inscribed in Article 16(1) to protect equality of opportunity in matters of public employment from the virus of spoils system.  Article 16(1) issues a positive command that there shall be equality of opportunity for all citizens in matters relating to employment or appointment to any office under the State which is the strongest safeguard against denial of equality of opportunity in public employment.  Equal protection means the right to equal treatment in similar circumstances both in the privileges conferred and in the liabilities imposed².  Article 16(1) is a positive constitutional command to banish spoils system which inevitably blighted the opportunity for appointments to any office or of any other employment under the State.  The concept of equality and equal protection of the laws guaranteed by Article 14 encompasses social and economic justice in a political democracy.  Article 14 lays down the general rule of equality and Article 16(1) is an incident of the general concept of equality enshrined in Article 14 in the matter of appointment and employment under the State.  The Government is not entitled to pick and choose from amongst a number of candidates offering themselves for employment under the Government.  It further guarantees a “right to be considered” on merit for the post.  Recruitment shall commence by open advertisement so as to enable all eligible persons to compete for selection on merit.  Recruitment must be carried out on the basis of merit system and not on political loyalties or practising nepotism by parties in power to strive to meet the highest standards of excellence in a service or post in which he or she gets appointment.

Reservation in appointments in favour of backward class of citizens in accordance with Article 16(4) as a positive facility and opportunity to such class to improve excellence in a service or post is an instance of classification permitted by Clause (1) of Article 16. Article 16(4) softened the rigour of legal equality and gave practical content of equality to provide distributive justice in favour of unequals to hold an office or post under the State in the democratic governance. It is a protective discrimination in favour of the disadvantaged segments of the society. It is a transitory measure to subserve and elongate constitutional objective and public policy of socio-economic justice as envisaged in Article 16(4) and Article 335 read with Articles 14 and 16(1) as also Article 38 and Article 46 and of all other cognate provisions of the Constitution. 

Services under the Union and the States are included in Chapter I Part XIV of the Constitution.  Article 309 relates to recruitment and conditions of services of persons serving the Union or a State. The recruitment and conditions of service of persons appointed to public services and posts in connection with the affairs of the Union or a State are to be regulated by Acts of the appropriate Legislature subject to the provisions of the Constitution.  The Proviso under the Article empowers the President or the Governor of a State to make rules regulating the recruitment and the conditions of service of persons appointed to such services and posts until provision in that behalf is made by or under an Act of the appropriate Legislature and any rules so made shall have effect subject to the provisions of any such Act. 

Chapter II of Part XIV of the Constitution relates to Public Service Commission.

Article 315 mandates that there shall be a Public Service Commission for the Union and a Public Service Commission for each State.  Under Article 320 (1) of the Constitution, it shall be the duty of the Union and the State Public Service Commissions to conduct examination for appointment to the services of the Union and the services of the State respectively. The examinations conducted by the Public Service Commission can be selective or competitive in nature.  It has been now settled that the best method of assessing the merit of candidates by open examination is to combine written test with an interview or viva voce test.  The ranked list is prepared in the order of merit and each one of the candidate included in the ranked list stands on a separate level of competence as compared with another.

Consultation with the Union Public Service Commission or the State Public Service Commission, as the case may be, is mandatory on all matters relating to methods of recruitment to civil services and for civil posts, on the principles to be followed in making appointments to civil services and posts and in making promotions and transfers from one service to another and on the suitability of candidates for such appointments, promotions or transfers under Article 320 (3)(b) of the Constitution.  It shall be the duty of a Public Service Commission to advise on any matter so referred to them and on any other matter which the President, or, as the case may be, the Governor of the State, may refer to them.  Our Constitution has spread protective umbrella for securing and reassuring equality before the law in matters of public employment.  Any action based on patronage system or spoils-sharing inconsistent with Part III and Article 320 of the Constitution is prohibited and is unconstitutional.  Article 320 tailored as it is to the job seeker’s concerns, meets the practical desiderata and assures salutary merit system in public services. Necessarily, and perforce, equal opportunity of appointment to a post or office is available to all citizens and constitutionally entitles them to consider their claims for employment/appointment to an office or post on merit basis.  Spoils system or patronage system which results in serious and atrocious consequences is prohibited by force of the constitutional command combined in Articles 14, 16(1) and 320 of the Constitution of India. 

It is quite clear that merit system received accreditation and confirmation under the Constitution. Article 320 of the Constitution provides an effective machinery displacing nepotistic recruitment policy for ensuring merit system in public employment which is jealously guarded in the Constitution.

In Supreme Court Advocates-on-Record Association v. Union of India³ a Constitution Bench of the Supreme Court held:

“It is necessary to appreciate that the Constitution does not envisage the “spoils system” (also known as the “patronage system”) wherein the political party which wins an election gives Government positions to its supporters, friends and relatives as a reward for working towards victory and as an incentive to keep the party in power.”

“It would be of utmost importance therefore, to shield judicial appointments from any political-executive interference to preserve the “independence of the judiciary” from the regime of the spoils system.  Preserving primacy in the judiciary, in the matter of selection and appointment of Judges to the higher judiciary would be a safe way to do so.”  It has been reasserted therein that “The expectation from the judiciary to safeguard the rights of the citizens of this country can only be ensured by keeping it absolutely insulated and independent from the other organs of governance. In our considered view, the present status of the evolution of the “civil society” in India does not augur the participation of the political-executive establishment in the selection and appointment of Judges to the higher judiciary, or in the matter of transfer of Chief Justices and Judges of one High Court to another.” 

Another facet of the unconstitutional dimension of public employment under the State is the policy of seeking Police report on the political faith of candidates for appointment and acting upon it, if the report reveals the political faith, beliefs, association and the past political activity of the candidate for public employment.  Article 16(2) of the Constitution brings out what is guaranteed under Article 16(1) in a negative form.  Article 16(2) prohibits discrimination on grounds only of religion, race, caste, sex, descent, place of birth, residence or any of them, for employment or office under the State.  The word ‘only’ after the word ‘grounds’ shows that clause (2) of Article 16 applies only where a citizen is ineligible for a certain public employment solely on the ground of his religion, race etc., mentioned in clause (2) and not on ground outside the categories of grounds specifically mentioned therein.Inevitably, denial of employment on grounds other than those mentioned in Article 16(2) falls outside the discrimination prohibited by clause (2).  Necessarily, in a case where employment is denied on the ground of political faith or on past political activities, the fundamental right guaranteed under Article 16(2)  of the Constitution is unavailing.  In that context, the Supreme Court condemned the policy of acting on Police report based on the political faith, beliefs, association and the past political activity of the candidate for public employment as introducing ‘McCarthyism’ into India which is obnoxious to the whole philosophy of our Constitution.

 ‘McCarthyism’ is the practice of making accusations of subversion or treason, especially when related to communism⁴. The term refers to U.S. Senator Joseph McCarthy (R-Wisconsin).  The practice has its origin in the period in the United States known as the Second Red Scare, lasting from the late 1940s through the 1950s.⁵   It was characterized by heightened political repression and a campaign spreading fear of communist influence on American Institutions and of espionage by Soviet agents.⁶  ‘McCarthyism’ began its decline due to the stiff opposition from the U.S. Supreme Court led by Chief Justice Earl Warren⁽⁶⁾⁽⁷⁾ and helped to bring to an end to ‘McCarthyism’ as a result of the series of rulings of the Warren Court.^(8)(9)(10)

In State of M.P. V. Ramashanker Raghuvanshi¹¹ the Supreme Court was dealing with a case where the termination of the services of a teacher founded on a report made by the Superintendent of Police that the teacher was not a fit person to be entertained in Government service as he had taken part in ‘RSS and Jan Sangh activities’.  The Supreme Court expressing its jural concern about the devastating results of such a policy, contextually posed the question ‘Is public employment reserved for “the cringing and the craven” in the words of Mr.Justice Black of the United States Supreme Court?’ and held:

“We think it offends the Fundamental Rights guaranteed by Articles 14 and 16 of the Constitution to deny employment to an individual because of his past political affinities, unless such affinities are considered likely to affect the integrity and efficiency of the individual’s service.  To hold otherwise would be to introduce ‘McCarthyism’ into India.  ‘McCarthyism’ is obnoxious to the whole philosophy of our Constitution.  We do not want it.”

“We are not for a moment suggesting that even after entry into government service, a person may engage himself in political activities.  All that we say is that he cannot be turned back at the very threshold on the ground of his past political activities.  Once he becomes a government servant, he becomes subject to the various rules regulating his conduct and his activities must naturally be subject to all rules made in conformity with the Constitution”.

A resume of the discussion leads to the logical conclusion that although there is no express provision in any statute or rules, regulation and by-law prohibiting spoils system, to follow ‘merit system’ in matters of public employment is a constitutional imperative which is non-negotiable.  Resort to spoils system on any pretext or for any ostensible goal is unconstitutional and impermissible.  Likewise, much to the constitutional consternation about non-inclusion of ‘political faith’ in Article 16(2) as a ground of discrimination for rendering a citizen ineligible for employment or office under the State, it emerges as pronounced inequality meted out to citizens when political authoritarianism, through denial of employment to public services for their past political activities, holds the fundamental rights of citizens guaranteed under Articles 14 and 16(1) of the Constitution to ransom for political reasons.  Such a practice, if and when adopted would offend equality of opportunity in matters of public  employment and its concomitant right to livelihood guaranteed under Articles 14, 16(1), 19(1)(g) and 21 of the Constitution and would fall within the mischief of ‘McCarthyism’ which is anathema to and is tabooed by our Constitution.