B.K.
Mohapatra Vs. State of Orlssa [1987] INSC 303 (28 October 1987)
VENKATARAMIAH,
E.S. (J) VENKATARAMIAH, E.S. (J) SINGH, K.N. (J)
CITATION:
1988 AIR 24 1988 SCR (1) 650 1987 SCC Supl. 553 JT 1987 (4) 170 1987 SCALE
(2)880
ACT:
Teacher's
service matter-Rationalisation scheme for integration of services of teachers
in different types of schools-Dispute regarding terms thereof relating to
seniority and contributory Provident Fund. Act of State.
HEADNOTE:
%
A number of the princely States, situated within the territories of the present
State of Orissa, were merged with effect from January 1, 1948, with the
Province of orissa as it then existed. On such merger, the High Schools within
the said princely States came under the juries diction of the Province of
Orissa. The Schools belonged to two categories- 'A' type schools which were
full-fledged High schools sending candidates for the Matriculation examination
and `B' type schools which were incomplete schools, not sending candidates for
the Matriculation examination. On the said schools being taken over by the
Province of orissa the teachers of the schools came under the control of the
Government of orissa. The orissa Government issued a letter dated 5.1.1949 to
the Director of Public Instruction in connection with the subject of regulation
of the services of the teachers.
The
appellant was an assistant teacher in one of the 'B' type schools on June 15,
1q953, after the commencement of the Constitution of India, and continued to
work as such in the 'B' type school till August 1, 1964, when the State
Government of Orissa published a rationalisation scheme for integrating the
services of the teachers in the different types of High Schools in the State.
Aggrieved by the terms of the Scheme relating to (i) the seniority of the
teachers working in the 'B' type High Schools and (ii). The contributory
Provident Fund, the appellant filed a writ petition in the High Court. The High
Court upheld the validity of the Scheme and dismissed the Petition, while
recommending, however, to the Government to modify the terms relating to the
Provident Fund Scheme applicable to the teachers of 'B' type High Schools. The
appellant then moved this Court by special leave against the decision of the
High Court.
Disposing
of the appeal, the Court, 651 ^
HELD:
It is true that till the commencement of the Constitution of India, the
position of the 'B' type High Schools and the teachers working in them was
being regulated in accordance with the terms contained in the order dated 5.1.1949.
But on the commencement of the Constitution of India, all the territories which
immediately before the commencement of the Constitution were either comprised
in the Province of Orissa or were being administrated as if they formed part of
that Province, became and constituted the State of Orissa. The State Government
was under obligation to discharge its executive functions with respect to
education in respect of all the schools including 'B' type High Schools. A High
school which once belonged to a princely state became a Government High School
with effect from the commencement of the Constitution and it could not be
anything else and the teachers working therein became teachers holding posts
under the Government. It is well- settled that the doctrine of an "act of
State" cannot be pleaded by a State as a defence against its own citizens.
An 'act of State' is an act done in relation to a foreigner by a Sovereign
power of a country. Such an act cannot be questioned in any court of law, but
such a situation would not arise between the State Government and a citizen
like the appellant who joined service after the commencement of the
Constitution. The High Court was in error in upholding the plea that the order
dated 5.1.1949 could not be questioned by the appellant who had joined service
after the commencement of the institution. [657A-E. GH; 658A] There is also no
rational basis for refusing to give the benefit of the service rendered by a
teacher working in a 'B' type High school after January 26, 1950, either for
purposes of seniority or for purposes of computing the retirement benefits. It
may be open to the State Government, while integrating the services of teachers
working in different kinds of institutions, to introduce a scheme of
rationalisation which may have the effect of modifying the conditions of
service of different groups of government servants. But the Government cannot
by a stroke of pendeny the benefit of the entire past service rendered by one
group of such government servants. The effect of the government scheme was that
all the teachers who had been in Government Schools immediately prior to June 1
1964 the date of covertion of the High Schools to government schools-became
senior to the teachers working in the 'B' type High Schools, Ex-District Board
High Schools and Ex-Anchal High Schools.
The
scheme appears to be an irrational one. The High Court was in error in
upholding the terms of the scheme in so far as the question of the seniority
was concerned. The judgment of the High Court. in so far as the validity of the
terms of the scheme, pertaining to 652 seniority of the teachers in the schools
referred to in it, is concerned, is reversed. the clause in the scheme which
reads: "But for the purpose of reckoning their seniority in Government
service their services will be counted from the date of conversion of the
schools into Government schools" is void. The State government is directed
to treat, on and after January, 26, 1950, the service of the teachers of the
'B' type High schools, ex-District Board High Schools and ex-Anchal High
Schools as the service under the State Government. It is open to the State
Government to evolve a reasonable formula for integrating the cadres of these
teachers with the cadres of the teachers in the High Schools which have been
under the Government all along. Before bringing about such integration, the
government may formulate reasonable principles for equating the posts in the
Government High Schools with the posts in the 'B' type High Schools,
ex-District Board High Schools and ex-anchal High Schools having regard to the
minimum qualification for the posts, pay, responsibilities, etc. In the light
of the said principles, the government shall prepare a seniority list,
whereafter it shall proceed to make promotions of the teachers to the higher
cadre. In view of the stand taken by counsel for the appellant and other
teachers in 'B' type High schools, ex-District Board High Schools and the ex-
Anchal High schools, regarding their not insisting upon promotions with
retrospective effect, etc., the State government shall promote these teachers
to the higher posts as and when the vacancies arise hereafter, on the basis of
their rank in the seniority list, if they are found fit for such promotion. The
government is at liberty, if it finds it convenient, to treat, as submitted by
the teachers' counsel, the two groups of teachers as belonging to separate
cadres and reserve certain percentage of posts for being filled up only by the
teachers of 'B' type High Schools, ex-District Board High Schools and ex-Anchal
High schools, as was the case in State of Punjab v. Joginder Singh, [1963
(Supp. 2) SCR 169]. The order of the High Court is modified to the above extent
and the State Government shall prepare the seniority list and make promotions
accordingly within six months in the light of the above observations. [659C-G;
660C-H; 661A-D] No opinion is expressed on the question of Contributory
Provident Fund Scheme, the same having been satisfactorily settled by the
state. [661D-E] Johnstone v. Pedlar, [1921] 2 A.C. 262, referred to.
Civil
Appellate Jurisdiction: Civil Appeal No. 661 of 1971.
653
From the Judgment and order dated 28.10.1969 of the Orissa High Court in O.J.C.
No. 165 of 1966.
S.P.
Pandey for the Appellant.
G.S.
Chatterjee for Respondent No. 1.
R.K.
Garg and J.R. Dass for Respondent No. 2.
The
Judgment of the Court was delivered by VENKATARAMIAH, J. With effect from
1.1.1948 a number of princely States which were situated within the territories
of the present State of Orissa were merged with the Province of Orissa as it
then existed. On such merger the High Schools within the said princely States
also came under the jurisdiction of the Province of Orissa. The said High
Schools belonged to two categories-namely 'A' type schools which were
full-fledged High Schools which were actually sending candidates for the
matriculation examination and 'B' type schools which were incomplete schools
not sending candidates for the matriculation examination. On the said High Schools
being taken over by the Province of Orissa, the teachers serving in the said
High Schools came under the control of the Government of Orissa. It then became
necessary to make an order to regulate the services of the said teachers. The
Government of Orissa in the Education Department issued a letter dated 5.1.1949
to the Director of Public Instruction on the subject. The relevant portion
thereof is extracted below:- "In the States the High Schools other than
those at District Headquarters mentioned above will be of two types. The
complete High Schools will be 'A' type High Schools and the incomplete High
Schools 'B' type High Schools.
The
'A' type schools will be similar to Government High Schools other than those at
District Headquarters. The services of the staff of such High Schools will be
pensionable and transferable and the teachers will get pay and dearness
allowances at the rates prescribed for Government servants. Government will
bear the whole of the recurring and non-recurring costs.
'B'
type High Schools will be Government managed.
654
The staff will get pay and allowances at rates prescribed for Government
servants. The Headmasters of those schools will be in the upper division of the
S.E.S. The services of those teachers will not be pensionable. They will have
the benefits of the Contributory Provident Fund to which Government will
contribute at the rate of Re. 1 in the rupee of the salary. As regards
recurring expenses of those schools Government will meet the difference between
the standard cost and income from fees and other local subscriptions. As
regards non-recurring expenditure Government will meet two-thirds of the cost.
The
standard cost for the 'B' type Government managed High Schools will consist of
the following items:- (a)..........................................
(b)
The total contribution on Provident Fund deposited at the rate of Re.-/ 1/- in
the rupee, and (c)..........................................
The
Inspector of Schools will be the managing agent on behalf of the Government and
the Headmaster will be the correspondent of a 'B' type Government managed High
School.
The
appellant was appointed as an Assistant Teacher on a pay of Rs.70 per month in
the pay scale of Rs.70- 140 plus admissible dearness allowance in one of the
'B' type High Schools by the Inspector of Schools on 15.6.1953 after the
commencement of the Constitution of India. He continued to work as an Assistant
Teacher in one or the other of the 'B' type High Schools to which he was
transferred until August 1, 1964 when the State Government published a
rationalisation scheme for integrating the services of the teachers in
different types of High Schools in the State of Orissa, namely, Zilla Schools,
'A' type Government High Schools, 'B' type High Schools, Ex-District Board High
Schools and Ex-Anchal High Schools hereinafter collectively referred to as
integrated High Schools. The relevant part of the scheme reads thus:-"No.
18027-E Government of Orissa Education Department Resolution 1st Aug., 1964
Sub:-Rationalisation of High Schools in the State.
655
Government have under their own management quite a few types of High Schools in
which conditions of service of the employees vary category to category. This un-uniformity
in the patterns and in the conditions of service has not only evoked public
criticism but also created certain administrative difficulties and tends to
lowering of standards in the institutions. It is for these reasons that
Government had for some time past under their consideration the question of rationalisation
of the following different types of High Schools in the State whose number is
noted against each.
1.
Zilla Schools -18
2.
'A' type Govt. High School. -52
3.
'B' type High Schools -22
4.
Ex-District Board High Schools. -17
5.
Ex-Anchal High Schools. - 6 After careful consideration Government have now
decided that the five types of High Schools mentioned above should be converted
into a single type of Govt. School with effect from 1st June, 1964.
Since
the employees of the 'B' type High Schools are in receipt of pay and allowances
on the scales applicable to Government servants the question of fixation of
their pay and allowances does not arise. They will continue to draw their
salary that they are drawing on the date of conversion.
In
respect of the incumbents of 'B' type High Schools who are governed by the
contributory provident fund rules, their subscriptions, if any, in the fund
together with the Government contribution on the date of conversion may either
be refunded to them or be credited to the General Provident Fund account to be
opened afresh according to their option and all the employees may be brought
under the Orissa General Provident Fund Rules. After conversion Government
shall not contribute anything towards the Employees' Contributory Provident
Fund. All the employees of 'B' type High Schools will be brought over to
pensionable service from the date of conversion of the schools into Government
Schools.
..................................................
656
The seniority of the 'B' type, Ex-District Board and Ex-Anchal Schools as among
themselves will be determined by their length of continuous service in their
respective cadres in the old Schools. But for the purpose of reckoning their
seniority in Government service, their services will be counted from the date
of conversion of the Schools into Government school......... "
(Underlining by us) Aggrieved by the terms of the rationalisation scheme
referred to above relating to (i) the Contributory Provident Fund and (ii) the
seniority of teachers who were working in 'B' type High Schools, the appellant
filed a writ petition in the High Court of Orissa questioning the
discriminatory treatment meted out to him and other teachers in 'B' type High
Schools. The appellants contended that even though he had been appointed in a
'B' type High School he should be treated as having entered the service under
the State Government on 15.6.1953 when he was appointed as an Assistant Teacher
in a 'B' type High School, that the clause in the scheme of 1964 which provided
that for the purpose of reckoning seniority in Government service the services
of teachers in 'B' type High Schools would be counted from the date of
conversion of the schools into Government schools which had the effect of wiping
of the previous service put in by them in the said schools was discriminatory
and that the terms relating to the Contributory Provident Fund were invalid.
The petition was resisted by the State Government pleading inter alia that the
decision of the Government dated 5.1.1949 being an 'act of State' its effect
could not be challenged by the appellant even though he had entered service in
the year 1953. The High Court upheld the validity of the scheme and dismissed
the writ petition. It, however, recommended to the Government to modify the
terms relating to the Provident Fund scheme applicable to the teachers of 'B'
type High Schools. Aggrieved by the judgment of the High Court, the appellant
has filed this appeal by special It is urged on behalf of the appellant that
the State Government was wrong in treating him as having entered the service
under the State Government only from June 1, 1964 although he had been
appointed by the Inspector of Schools in the year 1953. It is argued that
merely because the appellant was appointed in a 'B' type High School which once
belonged to a princely State he could not be denied the benefits available to
all other teachers in Government service. It is further submitted that the case
of the Government that the Government was 657 running 'B' schools as merely
agents was wholly untenable.
It
is no doubt true that the 'B' type High Schools were formerly in the princely
States and that on the merger of the States the then Government of the Province
of Orissa passed an order on 5.1.1949 stating that the 'B' type High Schools
would be governed and managed by the Inspector of Schools on behalf of the
Government and the Headmasters would be the correspondents of 'B' type
Government managed High Schools. It is also true that till the commencement of
the Constitution of India the position of 'B' type High Schools and the
teachers working in them were being regulated in accordance with the terms
contained in the order dated 5.1.1949. But on the commencement of the
Constitution of India all the territories which immediately before the
commencement of the Constitution were either comprised in the Province of
Orissa or were being administered as if they formed part of that Province
became and constituted the State of Orissa (vide Entry No. 10 in the First
Schedule to the Constitution of India.) The State Government was under an
obligation to discharge its executive functions with respect to education by
virtue of Entry 11 of the Seventh Schedule to the Constitution as it then
existed in respect of all the schools including 'B' type schools. A High School
which once belonged to the princely states became a Government High School with
effect from the commencement of the Constitution and it could not be anything
else. The Inspector of Schools could no longer function as the managing agent
on behalf of the State Government and the 'B' type High School could no longer
be a 'Government managed High School'. The teachers working therein became
teachers holding posts under the Government since there was no other authority
which owned the 'B' type High Schools after January 26, 1950 because there were
no territories within the State of Orissa which could be considered as
territories administered by the Government as if they formed a part of the
State which was the case until January 26, 1950. Though the princely States
were subject to the Paramountancy of the British Crown, they were considered to
be foreign States by the British Indian Provinces. Any action taken in respect
of them or their subjects by the British Indian Provinces was an act of State
but its effect could not be extended beyond January 26, 1950 because after that
date there was no longer any foreign Government. The princely States had gone
out of existence. It is well- settled that the doctrine of an 'act of State'
cannot be pleaded by a State as a defence against its own citizens. An 'act of
State' is an act done in relation to a foreigner by the sovereign power of a
country or its agent either previously authorised or subsequently ratified.
Such an act cannot be questioned or made the subject of legal 658 proceedings
in any Court of law. But such a situation would not arise A between the State
Government and a citizen like the appellant who joined service after the
commencement of the Constitution.
It
is appropriate to refer here to the decision of the House of Lords in Johnstone
v. Pedlar, [1921] 2 A.C. 262 in which the nature of an 'act of State' arose for
consideration. Lord Atkinson observed at pages 278-279 thus:
"The
best definition, I think, of an act of State, as well as the descriptions of
the consequences flowing from it, is that given in the judgment of Lord
Kingsdown in the case of Secretary of State for India v. Kamachee Boye Sahaba.
(13 Moo. P.C. 22). In that case, the Rajah of Tanjore, a native independent
sovereign, who was, by virtue of certain treaties, under the protection of the
East India Company, in exercise of their sovereign power and in trust for the
British Government, seized the Raj of Tanjore and the whole property of the
deceased Rajah as an escheat, on the ground that the dignity of the Raj was
extinct for want of a male heir, and that this property lapsed to the British
Government. It was held first, as it was held in Buron v. Denman (2Ex. 167),
that an act done by an agent of the Government, though in excess of his
authority, on being ratified and adopted by the Government, was of the same
authority as if it had originally been directed by the Government, that the
effect of the ratification is, in the language of Parke B. In Buron v. Denman
(Ibid. 188-9), this, that it only leaves a remedy against the Crown (such as it
is), and exempts from all liability the person who commits the trespass, and,
second, that the seizure made by the British Government acting as a sovereign
power through its delegate, the East India Company, was an act of State to
inquire into the propriety of which a municipal Court had no jurisdiction. Lord
Kingsdown, in delivering the judgement of the Privy Council said (13 Moo. P.C.
77, 86); "Acts done in the execution of these sovereign powers were not
subject to the control of the municipal courts, either of India or Great
Britain." In the same decision Lord Phillimore said at page 295 thus;
"The
defence set up in the present case is sometimes 659 called the defence of an
act of State. As regards this way of looking at it, I cannot put the matter
better or more tersely than as I found it put in one of the reasons given by
the successful plaintiffs in their case as respondents before the Privy
Council, in Walker v. Baird, [1892- A.C.
491,
494): "Because between Her Majesty and one of her subjects there can be no
such thing as an act of State." And this proposition was finally accepted
in the case of Walker v. Baird, [ 1892- A.C. 491, 494)" The High Court
was, therefore, in error in upholding the plea that the order dated S. 1.1949
could not be questioned by the appellant who had joined service after the
commencement of the Constitution.
There
is also no rational basis for refusing to give the benefit of the service
rendered by a teacher working in a 'B' type High School after January 26, 1950
either for purposes of seniority or for purposes of computing the retirement
benefits. It may be open to the State Government while integrating the services
of teachers working in different kinds of institutions to introduce a scheme of
rationalisation which may have the effect of modifying the conditions of
service of different groups of Government servants. It cannot, however, by a
stroke of pen deny the benefit of the entire past service rendered by one group
of such Government servants. The effect of the Government scheme was that while
for purposes of inter se seniority amongst the teachers of 'B' type High
Schools, Ex-District Board High Schools and Ex-Anchal High Schools, that is,
integrated High schools the length of continuous service in their respective
cadres in their old schools was to be counted, for purposes of reckoning
seniority vis-a-vis teachers in Government schools their service was to be
counted, only from the date of conversion of those High Schools to Government
Schools, i.e., from June 1, 1964.
Consequently
all teachers who had been in Government Schools immediately prior to June 1,
1964 became seniors to the teachers working in 'B' type High Schools,
Ex-District Board High Schools and Ex-Anchal High Schools. The scheme put
forward by the Government appears to us to be an irrational one. We may at this
stage mention that when this case was heard earlier by a bench of three learned
Judges of this Court consisting of V.R. Krishna Iyer, R.S. Pathak (as he then
was) and o. Chinnappa Reddy, JJ. it was observed by the learned Judges on
January 3 1, 1980 thus:
"We
have been taken through the judgment of the High 660 Court and the relevant facts
by Shri Sikri and we are satisfied that the reasons given by the High Court are
far from satisfactory. On the other hand, no serious consideration of the
ground of discrimination in ignoring the past service of the teachers has been
given by the High Court." After making the above order the learned Judges
granted time to the State Government to evolve a fresh scheme for integration
of the services of the teachers in the schools referred in the scheme of 1964
with the teachers employed in the High Schools which were Government Schools
all along. It is reported to us that the Government was not willing either to
modify the existing scheme or to formulate a new scheme in a reasonable way. We
respectfully agree with the above observations made by the three learned
Judges. We are of the view that the High Court was in error in upholding the
terms of the scheme insofar as the question of seniority was concerned. We are,
therefore, constrained to reverse the judgment of the High Court insofar as the
question relating to the validity of the terms of the scheme pertaining to the
seniority of the teachers working in the schools referred to in it is
concerned. We hold that the clause in the scheme which reads: "But for the
purpose of reckoning their seniority in Government service, their services will
be counted from the date of conversion of the schools into Government
schools" is void. We direct the State Government to treat on and after
January 26, 1950 the service of the teachers of 'B' type High Schools, Ex-District
Board High Schools and Ex-Anchal High Schools as the service under the State
Government. It is open for the State Government to evolve a reasonable formula
for integrating the cadres of these teachers with the cadres of teachers in
High Schools which have been under the Government all along. Before bringing
about such integration, the Government may formulate reasonable principles for
equating the posts in the Government High Schools with the posts in the 'B'
type High Schools, Ex-District Board High Schools and Ex-Anchal High Schools
having regard to the minimum qualification for the posts, pay, responsibilities
etc. In the light of the said principles, the Government shall prepare a
seniority list. There after. it shall proceed to make promotions of teachers to
higher cadres. We may at this stage state that the learned counsel for the
appellant and other teachers working in 'B' type High Schools, Ex-District
Board High Schools and Ex-Anchal High Schools has submitted that these teachers
do not insist upon promotions being given to them with retrospective effect
even if it is found that they are entitled to it but they only pray that they
may be promoted to the vacancies which may occur in the higher cadres
hereafter. We express our 661 appreciation of the stand taken by the learned
counsel in this regard. The State Government shall, therefore, promote these
teachers to higher posts as and when vacancies arise hereafter on the basis of
their rank in the seniority list if they are found fit for such promotion. The
learned counsel has further submitted that if the State Government finds it
difficult to integrate the teachers belonging to 'B' type High Schools and
teachers of other integrated schools with the teachers working in Government
High Schools, the State Government may at least consider the question of
treating the two groups of teachers as belonging to separate cadres and reserve
certain percentage of posts for being filled up only by the teachers of 'B'
type High Schools, Ex-District Board High Schools and Ex-Anchal High Schools as
was the case in State of Punjab v. Joginder Singh, [ 1963] Supp. 2 S.C.R. 169.
The Government is at liberty to do so if it finds it to be convenient. The
order of the High Court is, therefore, modified to the above extent and the
State Government shall prepare seniority list and make promotions accordingly
within six months from today in the light of the above observations.
As
regards the question of the Contributory Provident Fund Scheme is concerned, we
are informed that it has been satisfactorily settled by the State Government.
We, therefore, express no opinion on that question.
The
appeal is disposed of accordingly.
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