TMI Blog1978 (12) TMI 187X X X X Extracts X X X X X X X X Extracts X X X X ..... oth the Development Board and the Municipal Board, Kanpur, constituted under the U.P. Municipalities Act, 1916, under the U.P. Local Bodies (Appointment of Administrators) Act, 1953. The two local bodies, however, continued to have separate legal existence and their officers and servants continued as the employees of the respective bodies. The appellant Mohd. Rashid Ahmad was appointed as Offg. Executive Engineer by the Administrator of the Municipal Corporation, Kanpur, for a period of one year on September 12, 1960. He has since then continued to function in the same capacity, on a purely temporary arrangement under s.577(ee), that is, for so long as no substantive appointment could be made to that post under s.106. The Uttar Pradesh Public Service Commission, however, considered that he was not fit for appointment for the post of the Executive Engineer, Municipal Corporation, Kanpur. The appellant in the connected appeal, Ashfaq Hussain was a permanent Sanitary Inspector in the Municipal Board, Kanpur. After the constitution of the Municipal Corporation, Kanpur, he continued to hold that post under s. 577(e). On July 24, 1967 he was transferred in the same capacity to the Mun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ralised) Services Rules, 1966, which came into force on July 9, 1966. Rule 3 created 19 Palika (Centralised) Services, covering 76 posts, common to all the Municipal Corporations and Municipal Boards. The rules provided for regulating the recruitment and conditions of service of the persons appointed to these newly created services. Rule 6 dealt with recruitment to the Centralised Palika Services. Due to inadvertence r.6 was not drafted in conformity with the requirements of s.112A and s.69B. That was because cl.(1) provided for automatic final absorption of officers and servants provisionally absorbed under s.577(e), contrary to the provisions of s.112A of the Adhiniyam and s.69B of the Municipalities Act. On September 5, 1966, the Governor promulgated the U.P. Local Self-Government (Amendment) Ordinance, 1966, which was replaced by the U.P. Local Self-Government Laws (Amendment) Act 1966. Section 19 of the Act reads as follows: 19. Deeming, validation, etc. The Uttar Pradesh Palika (Centralised Services Rules, 1966, shall be deemed to have been made under the provisions of the Uttar Pradesh Nagar Mahapalika Adhiniyam, 1959, and the U.P. Municipalities Act, 1916, as if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duced a new cl.(iii) to r.6(2), in place of the existing cl.(iii) of U.P. Palika (Centralised) Services Rules, 1966, by which the date of passing the order was shifted from March 31, 1967 to August 31, 1967, with retrospective effect from July 9, 1966. Having provided for the creation of Centralised Palika Services, the State Government had, in the meanwhile, laid down the procedure by which an office or servant provisionally absorbed under s. 577 (e) of temporarily appointed under s.577(ee), were to be finally absorbed, if found suitable, under s.112A. By its three circulars dated January 11, 1967; January 31, 1967 and February 23, 1967, addressed to the Divisional Commissioners, it intimated the constitution of Divisional Committees for making necessary recommendations to the State Government in this behalf. The first circular embodied the Government policy in these terms: Government desire that all officers and servants, whose services are proposed to be determined on grounds of unsuitability may be given an opportunity of personal interview by the Committee. After such interviews, the Committees were to finalise their recommendations and furnish the same to the Gover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise of officers and servants holding Centralised Services posts drawing less than ₹ 500/-, to Divisional Committees, and reserved such function in respect of officers and servants drawing ₹ 500/- or more, to the State Selection Committee, and by its subsequent circular dated February 23, 1967 maintained the classification of such officers and servants for purposes of judging their suitability for absorption in the Centralised Palika Services, the final orders of absorption in each case under s.112A were passed by the State Government. In the former class, the recommendations of Divisional Committees were scrutinised by the State Government in the Local Self- Government Department, in the light of the service records of the officials concerned, and the necessary orders thereon were passed. In respect of the latter category, the Secretary to the Government, Local Self Government Department prepared a note and put it up for the Minister for passing the final orders. It is also worthy of mention that the delay in completing the work of final absorption by the State Government was mainly due to three factors, namely; (1) due to shortness of the time available at its dispo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver, rejected all these contentions. In view of the language of Entry 5, List II of the Seventh Schedule, the objection regarding the validity of r.6(2) (iii) was rightly not pressed before us. On the view that we take of the various circulars issued by the State Government laying down the procedure for dealing with the question of suitability or otherwise of officers and servants of the erstwhile Municipal Boards for absorption in the Centralised Services under r.6(2)(iii) the contention based on Articles 14 and 16 of the Constitution also does not arise. Learned counsel appearing for the appellants assailed the impugned orders of the State Government on two grounds, namely: 1. By reason of the legal fiction contained in cl.(iii) of r.6(2), the services of the appellants stood finally absorbed in the U.P. Palika Centralised Services on March 31, 1967 due to the failure of the State Government to pass the necessary orders in that behalf before that date. Under the legal fiction contained in cl.(iv) thereof, and the subsequent amendment made by the U.P. Palika (Centralised) Services (Amendment) Rules, 1967 which came into force on April 1, 1967, the vested rights acquired b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Municipal Corporations provisionally absorbed under s. 577(e) if found suitable, on or before March 31, 1967. If there was a failure on the part of the State Government to pass such an order in respect of a particular officer or servant by that date, it would, unless there was a provision to the contrary, bring into play the legal fiction contained therein, and he would, by its force, be deemed to be finally absorbed in the post held by him. The State Government in their return have candidly stated that due to inadvertence, the subsequent amendment effected on March 30, 1967, was made to take effect on April 1, 1967, by which date the legal fiction under cl. (iv) had already taken effect. It, therefore, became necessary to correct the serious legal infirmity. It was for that reason that the subsequent amendment was made on June 26, 1967 by which a new cl. (iii) was substituted in place of the existing cl. (iii) to r.6(2). The amendment substituted new cl. (iii) to r. 6(2) with effect from July 9, 1966 i.e., from the very inception. It was legitimately within the powers of the State Government to give to the amended rule a retrospective effect. As a result of the amendme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mohar Singh's case, would be not whether the new Act expressly keeps alive old rights and liabilities, but whether it 'manifests an intention to destroy them'. It was held that s. 6 of the General Clauses Act was not entirely ruled out when there was a repeal of the enactment followed by a fresh legislation unless the new legislation manifested an intention to the contrary. Such incompatibility had to be ascertained from a consideration of all the relevant provisions of the new law and the mere absence of a saving clause was, by itself, not conclusive. In the present case, however, there can be no doubt that by the introduction of the new fictional date of absorption as August 31, 1967, there was a clear intention to destroy the earlier fictional date of March 31, 1967. It would clearly be incompatible, on consideration of subsequent amendment, for both the provisions, i.e., the original cl. (iii) fixing March 31, 1967 and the new cl.(iii) fixing August 31, 1967 to be the fictional date, to operate simultaneously. The effect of introduction of the new fictional date was to annihilate the earlier fictional date. The appellants, therefore, did not stand automatically ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of officers and servants serving on the posts included in such Centralised Services under s.112A(2). In the very nature of things, the officers and servants provisionally absorbed under s.577(e) or temporarily appointed under s.577(ee) could not be automatically absorbed in the newly created Centralised Services. There had to be a screening of all such officers and servants with a view to determine their suitability or otherwise for final absorption in Centralised Services. It was particularly necessary to weed out the dead-wood to bring about an overall improvement in the municipal administration in these cities. The very nature of the functions entrusted to the State Government under r.6(2) (iii) of the U.P. Palika (Centralised) Services Rules, 1966 for purposes of final absorption under s.112A of the Adhiniyam, implies a duty to act in a quasi-judicial manner. It cannot be denied that an officer or servant provisionally absorbed under s.577(e) or temporarily appointed under s.577(ee) had the right to be considered for purposes of final absorption. Such officers or servants, particularly those in permanent employment who had put in 20 to 25 years of service in the erstwhi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally . There is, therefore, the insistence upon the requirement of a fair hearing . In A. K. Kraipak v. Union of India there was a reiteration of the principles, albeit in a different form, laid down by this Court in Dr. (Miss) Binapani Devi v. State of Orissa and by the House of Lords in Padfield v. Minister of Agriculture, Fisheries Food that the executive should not arbitrarily or capriciously act and that the myth of executive discretion is no longer there. Indeed, in Kraipak's case (supra) it was observed: The dividing line between an administrative power and a quasi-judicial power is quite thin and is being gradually obliterated. Under our Constitution the rule of law pervades over the entire field of administration. Every organ of the State under our Constitution is regulated and controlled by the rule of law. In a welfare State like ours it is inevitable that the jurisdiction of the administrative bodies is increasing at a rapid rate. The concept of the rule of law would lose its vitality if the instrumentalities of the State are not charged with the duty of discharging their function in a fair and just manner. The requirement of acting judicially in essence i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting salary was ₹ 500/- and more, and entrusting the function to the Divisional Committees in case of those whose starting salary was less than ₹ 500/-, was still subject to the Government policy already laid down. It is, therefore, not right to suggest that the State Government was absolved of the duty to hear the officers and servants of the erstwhile Municipal Boards and other local authorities drawing ₹ 500/- and above All the officers and servants of the erstwhile Municipal Boards and other local authorities provisionally absorbed under s.577(e) or temporarily appointed under s.577 (ee) were therefore, entitled to be heard in the matter of their final absorption under s.112A read with r.6(2) (iii), irrespective of their salary. The requirements of a fair hearing are fulfilled in the case of officers and servants of the erstwhile Municipal Boards and other local authorities drawing a salary of less than ₹ 500/- but not in the case of those drawing ₹ 500/- or more. It is accepted before us that the appellant Ashfaq Hussain was called for an interview by the Divisional Committee. The State Government in its return has placed material showing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an initial salary of not less than ₹ 500/- per mensem, could be made except after consultation with the Public Service Commission, and that the Commission did not find the appellant fit for appointment as Executive Engineer, Municipal Corporation, Kanpur. It was also pointed out that under s. 108 the appellant could not hold the post beyond the period of one year. It was, therefore, urged that the State Government was justified in terminating the services of the appellant as he could not be finally absorbed in the post of an Executive Engineer in the Centralised Services. It was said that the post had to be advertised for filling up the vacancy as required under s. 107 of the Adhiniyam. We are afraid, the contention cannot be accepted. Under s. 112A (1) of the Adhiniyam, the State Government having by U.P. Palika (Centralised) Services Rules, 1966, constituted the Centralised Palika Services, the appellant Mohd. Rashid Ahmad, who was performing the duties and functions of the post of Executive Engineer under s. 577(ee), was entitled to be considered, if found suitable, for absorption under s.112A(2). Admittedly, the appellant was not heard in the matter of his final absorp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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