Kapila Hingorani
& ANR Vs. State of Bihar & ANR [2008] INSC 1057 (8 July 2008)
Judgment
"Reportable"
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION I.A. NO. 21 OF 2007 IN WRIT PETITION
(CIVIL) NO. 488 OF 2002 Kapila Hingorani & Anr. .... Appellant Versus State
of Bihar & Anr. .... Respondent
V.S. SIRPURKAR, J.
- In
the instant Application, the petitioner seeks directions from this Court
on the following:
a. Direct the respondent
State/JHALCO to immediately comply with the Order dated 13.1.2005 and pass the
Order of absorption in JHALCO with respect to 213 employees listed in the
letters issued by MD, JHALCO on various dates (annexed to the I.A.), pursuant
to the Order dated 13.1.2005 leaving the employees who have died.
b. Pass any other Order
(s) as may be deemed fit and proper.
- The
short history for proper decision would be necessary.
History:
- Original
State of Bihar came to be divided into existing State of Bihar and State
of Jharkhand by Bihar Reorganisation Act with effect from 15.11.2000. The
State of Jharkhand exercising its power under Section 85 of the Bihar
Reorgnisation Act constituted a Corporation called "Jharkhand Hill
Area Lift Irrigation Corporation" (hereinafter called `JHALCO') by
notification no. 2580 with effect from 29.12.2001.
- It
may be recalled that there were press reports regarding the non- payment
of salaries for long time resulting in starvation of the employees of this
Corporation. It was also reported that one Chandan Bhattacharya, son of an
employee of the Bihar State Agro-Industries Development Corporation tried
self-immolation, which incident was widely reported in the press.
Ultimately, the said Chandan Bhattacharya succumbed to the burn injuries.
A public spirited lawyer initiated public interest litigation in this
Court under Article 32 of the Constitution of India, inter alia raising a
question regarding the liability of the Government of State of Bihar for
payment of arrears of salaries to the employees of the said owned
corporations, public sector undertakings and statutory bodies. The State
of 3 Bihar filed its counter affidavit and claimed that the salaries were
being paid by the statutory authorities and further that all the salaries
upto 30.9.2002 were paid in the case of 26 undertakings. In respect of some
other Corporations, however, it was reported that large number of
employees were not paid the salaries and huge arrears remained involving
crores of rupees. In case of as many as 16 undertakings including Bihar
Hill Area Lift Irrigation Corporation (hereinafter called `BHALCO'), it
was also admitted that 14 employees had died in harness and 9 after
retirement. However, it was totally denied that there was any suicide or
death due to starvation of any of the employees of the corporation. After
hearing the amicus curie, who was appointed by this Court as also the
learned counsel who appeared on behalf of State of Bihar and Union of
India, and after considering the law in details, the Court issued the
following interim directions in the matter on 9.5.2003:
i.
"
The High Court may strive to dispose of all liquidation proceedings in respect
of the government companies owned and controlled by the State of Bihar as
expeditiously as possible. For the said purpose and/or purposes ancillary to or
incidental therewith, it may pass an interim order and/or orders by way of sale
and/or disposal of the properties belonging to such public sector undertakings
and/or government companies or to take such measure or measures as it may deem
fit and proper.
ii.
For
the aforementioned purposes a committee not consisting of more than three
members chaired by a retired High Court Judge or a sitting District Judge may
be appointed who may scrutinize the assets and liabilities of the companies and
submit a report to the High Court as expeditiously as possible 4 preferably
within three months from the date of constitution of the Committee. The terms
and conditions for appointment of the said Committee may be determined by the
High Court. All expenses in this behalf shall be borne by the State of Bihar.
iii.
The
High Court shall be entitled to issue requisite direction/directions to the
said Committee from time to time as and when it deems fit and proper.
iv.
The
State for the present shall deposit a sum of Rs.50 crores before the High Court
for disbursement of salaries to the employees of the Corporations. The amount
of Rs.50 crores be deposited in two installments. Half of the amount shall be
payable within one month and the balance amount within a month thereafter. The
High Court shall see to it that the sum so deposited and/or otherwise received
from any source including by way of sale of assets of the government
companies/public sector undertakings be paid proportionately to the employee
concerned wherefor, the parties may file their claims before it.
v.
The
High Court, however, in its discretion may direct disbursement of some funds to
the needy employees, on ad hoc basis so as to enable them to sustain themselves
for the time being.
vi.
The
rights of the workmen shall be considered in terms of Section 529-A of the
Companies Act.
vii.
The
Central Government is hereby directed to take a decision as regards division of
assets and liabilities of the government companies/public sector undertakings
in terms of the provisions of the State Reorganisation Act, 2000.
viii.
The
State of Jharkhand is hereby impleaded as a respondent.
let notice be issued
to the newly added respondent."
It is clear that
these directions were only to meet the exigencies which were then prevailing.
- It
seems that thereafter, number of developments took place including
constitution of the committee by the High Court of Patna, as also the
disbursement of 50 crores of rupees which were directed to be paid by the
State of Bihar and which were deposited as per the directions. This Court
on 13.8.2004 issued a direction, directing the State Government, in
consultation with the concerned Ministries, to take the decision regarding
the division of assets and liabilities of the government companies/public
sector undertakings in terms of provisions of State Reorganisation Act,
2000.
- Two
I.As. being I.A. no. 7 of 2004 and I.A. no. 9 of 2004 came to be filed. In
I.A. no. 7 of 2004, a clarification was sought in respect of JHALCO with
the prayer that JHALCO should be treated as a successor of BHALCO from
15.11.2000 onwards. This was necessitated on account of the alleged offer
by JHALCO by way of advertisements on 27.3.2003 and 31.7.2003. While by
1st advertisement the last date to submit the applications was 5.4.2003,
by 2nd advertisement it was extended to 7.8.2003. 398 applications were
filed out of which 302 were found eligible and those applicants were
absorbed. Thus 14 officers, 44 Class III employees and 244 Class IV
employees were absorbed. It was clearly stated in the advertisement that
the employees of BHALCO would be absorbed by JHALCO only if they forego
their claim of salary for period prior to their respective date of
absorption. By I.A. no. 9 of 2004, a 6 direction was sought that
respondent State of Bihar and/or State of Jharkhand should deposit
sufficient sum of money with the Patna High Court, so that at least the
employees of the Corporations listed in the Order dated 9.5.2003 be paid
their salaries.
- These
I.As were opposed by the State of Bihar by filing counter affidavits. The
State of Jharkhand which was impleaded as a party also filed its counter
affidavit which was affirmed by one Binod Kumar Verma, Managing Director,
JHALCO, Ranchi. The stand taken by State of Jharkhand was that BHALCO was
still under the control of State of Bihar and in place of BHALCO, a new
Corporation known as JHALCO had been incorporated and registered by the
Registrar of Companies, Jharkhand on or about 22.3.2002. In short, the
stand was taken that JHALCO has nothing to do with BHALCO and it could not
be treated as a successor of JHALCO. The Union of India had also filed an
affidavit, wherein it was pointed out that winding up applications had
already been filed by the State of Bihar in respect of as many as 18
companies, and in view of that, no order was required to be passed under
Section 65 by the Central Government. It was also pointed out that 8
companies operated only within the territories of Bihar and as such, there
was no necessity of bifurcation thereof. It was also pointed out that in
respect of the 4 companies which were operating both within the
territories of State of Bihar and Jharkhand, a direction was already
issued for the division of assets and liabilities. It was 7 pointed out
in respect of such companies that they would continue to function as the
inter-state corporations in the State of Bihar and State of Jharkhand. A
Committee was also constituted for the implementation of the orders passed
by the Central Government, which comprised of the Chief Secretary, Bihar
or his/her nominee and Chief Secretary, Jharkhand or his/her nominee. The
State of Bihar took the stand that the State had no liability to pay the
salaries of the employees of the statutory corporations/companies
incorporated under the Indian Companies Act.
The Court passed a
detailed Order dated 13.1.2005. It firstly expressed its dissatisfaction on the
stand taken by the State of Bihar and then observed as under:
"It is true, as
has been contended on behalf of the State of Jharkhand that a new corporation
named as JHALCO has come into being, but keeping in view of the fact that the
State of Jharkhand itself has given option to the employees of BHALCO, the
order of absorption of those employees who opt for employment may be passed at
an early date and not later than six weeks from date. The concerned employees
need not file any undertaking at this stage as the question as to whether the
State of Jharkhand is liable to pay any salary and other emoluments to the
employees of BHALCO is a question which would fall for decision in an appropriate
proceedings (emphasis supplied)."
The Court also
further held:
"We make it
clear that we have not issued aforementioned directions to the States of Bihar
and Jharkhand on the premise that they are bound to pay the salaries of the
employees of the public sector undertakings but on the ground that the
employees have a human right as also a fundamental right 8 under Article 21
which the States are bound to protect. The directions, which have been issued
by this Court on 9.5.2003 as also which are being issued herein, are in
furtherance of the human and fundamental rights of the employees concerned and
not by way of an enforcement of their legal right to arrears of salaries. The
amount of salary payable to the concerned employees or workmen would undoubtedly
be adjudicated upon in the proper proceedings. However, these directions are
issued which are necessary for their survival.
Undoubtedly, any
amount paid by Justice Uday Sinha Committee pursuant to these directions shall
be duly credited for."
This is how I.A. nos.
7, 9 and 10 were disposed of.
- However,
thereafter, I.A. no. 11 was filed for modification of the Court's Order
dated 13.1.2005 in I.A. no. 7, 9 and 10. There was another I.A. no. 13,
which was filed for clarification of the Order dated 13.1.2005.
An affidavit came to
be filed by JHALCO in I.A. no. 11, and it was directed to place on record, the
details of the sanctioned posts, filled up posts and the balance. On 11.9.2006,
another order came to be passed on I.A. nos. 8 and 11. By Order dated 3.11.2006,
further time was granted to the State of Jharkhand to file the reponse to the
Status Report which was already filed. The matter was adjourned from time to
time, thereafter. Ultimately, an Order came to be passed on 16.7.2007, where
firstly, the Court issued the same humanitarian directions to the State for
bearing the expense of those employees who were critically ill and insofar as
I.A. no. 11 of 2005 was concerned, the following Order was passed:
- "It
is stated by Mr. Ajit Kumar Sinha, learned counsel appearing on behalf of
the State of Jharkhand that pursuant to this Court's Order dated 13.1.2005
out of 398 workmen who had been working with BHALCO and who had been asked
to report for duty within three weeks, only 302 turned up and they have been
absorbed. Learned counsel states that order of absorption had been passed
despite the fact that 158 people have been found to be surplus. In this
view of the matter learned counsel submits that those who had not turned
up for their absorption within the aforementioned period may not be
directed to be absorbed pursuant to this Court's Order dated 13.1.2005.
In view of the
statement of Mr. Ajit Kumar Sinha, learned counsel that 158 persons are
surplus, we are of the opinion that those who have not turned up for duty on
the appointed date may seek their remedies in the matter as are available to
them in law. We need not issue any direction in regard to their absorption.
I.A. no. 11 is
disposed of accordingly.
I.A. no. 8 I.A. no. 8
for intervention is dismissed as not pressed." The statement was
obviously an incorrect one because the absorption of 302 employees was
obviously not done in pursuance of the Court's Order dated 13.1.2005. In fact,
those advertisements for absorption of the erstwhile of BHALCO employees were
issued much earlier to the Court's Order dated 13.1.2005. It seems that after
the Order dated 13.1.2005, as many as 216 applications were filed by the
erstwhile BHALCO employees. Out of these 216 employees, 5 were officers, 31 10
were Class III employees and 180 were Class IV employees. Therefore, it is
obvious that while passing an Order on I.A. no. 11, this Court was kept in dark
about two factors. Firstly that advertisements were already made even before
the Order dated 13.1.2005 and secondly that nothing was done in pursuance of
the Order dated 13.1.2005 excepting that the fresh applications of 216
employees were accepted by JHALCO and that they were kept in the cold storage.
- Again
on 21.9.2007, the Court directed the counsel for the State to file the
Status Report.
- It
is on this background, that the present I.A. no. 21 has been filed.
The Court issued
notice on I.A. no. 21, which notice was accepted by Mr. Ajit Kumar Sinha,
counsel for the State of Jharkhand and he was given two weeks' time to file
reply by Order dated 12.11.2007. Ultimately, on 13.12.2007, this Court passed
the following Order;
"Having heard
the learned counsel for the parties, we are of the opinion that as the
situation in which the employees of the erstwhile BHALCO arises out of a
statement before us by the counsel for JHALCO, from which the State now seeks
to wriggle out, we are of the opinion that the Secretaries of the State of
Bihar and the State of Jharkhand as also the Managing Directors of the BHALCO
and JHALCO should have a dialogue in regard to the absorption of the concerned
employees and a report be submitted to this Court. If necessary, intervention
of the appropriate Department of the Central Government may also be taken.
11 List the matter
on 31.1.2008.
The Secretary of the
Irrigation Department of the State of Jharkhand as also the Managing Director
of JHALCO shall remain present before us on that date."
- When
the matter was taken up on 31.1.2008, there were two reply affidavits
filed. The Managing Director of JHALCO in the initial reply specifically
owned that the Status Report shown in the earlier affidavits which were
filed subsequent to the Order dated 13.1.2005, was actually that of the
period prior to 13.1.2005, though it was purported to be relating to
subsequent period. An unconditional apology was tendered as under:
"The State
through its counsel gives an unconditional apology since it was only intended
to mention prior to 13.1.2005 and not pursuant to 13.1.2005."
- The
matter was left at that. This so-called parawise reply does not seem to
convey anything new. In paragraph 9, however, it was stated that in
pursuance of the Order dated 13.8.2004 of this Court, the Government of
India vide letter no. 12025/24/2004-SR dated 13.9.2004 had decided that
BHALCO continued to be under the control of the Government of Bihar in
terms of Section 65 of the Bihar Reorganisation Act, 2000. It was,
therefore, pleaded in that paragraph that BHALCO and JHALCO were two
different corporations having no connection of inter dependence between
12 them. It was only on this basis that ultimately it was prayed that I.A.
no. 21 should be dismissed.
- We
are constrained to say that in filing the said report in pursuance of I.A.
no. 11 and making solemn statement before this Court that 302 employees
were already accommodated in pursuance of the Order of this Court dated
13.1.2005, a clear cut misleading and false statement was made, but for
which this Court would not have passed the Order dated 16.7.2007 on I.A.
no. 11. We express our consternation. We must also say that we are not at
all satisfied with the bald apology which we have already quoted above.
There is no explanation, whatsoever, as to how such a statement came to be
issued on behalf of the State Government by its standing counsel. It is
obvious that the State merely made a poor attempt to extricate itself from
the difficult situation.
- The
State filed an additional affidavit. In the additional affidavit, however,
it was reiterated that a meeting was arranged to be held between the
concerned Secretaries and the Managing Directors on 17.1.2008 at Ranchi,
wherein, the relevant facts and issues were discussed. The affidavit once
again stated about the erstwhile absorption of 302 employees, and further
that as on date, 216 employees were left with BHALCO who had not so far
been absorbed. It was then pointed out that there was already a surplus of
152 Class IV employees with JHALCO and if 216 employees were further
directed to be absorbed, JHALCO would 13 become a sick company. The
affidavit further asserted that initial responsibility rests with BHALCO
owing to the order passed by the Central Government on 13.9.2004. It was
also further reiterated in the affidavit that the Government of Bihar and
the Managing Director of BHALCO did not accept this order dated 13.9.2004
and had protested against the Ministry of Home Affairs and submitted that
all the employees of BHALCO should be absorbed by JHALCO. The affidavit
then goes on giving certain chronology of events, showing as to how JHALCO
was brought under the existence. It was accepted that JHALCO adopted the
rules and regulations of BHALCO and that some assistance was received from
the financial institutions for execution of its schemes. Further, it was
expressed that the services of BHALCO's employees would be taken only as
per the requirement. Again, a reference was made to the two advertisements
by which the BHALCO's employees were given the opportunity to apply for
absorption. It was also pointed out that the Muster-Roll employees,
employees deputed in the Government Department and employees who presented
mutilated documents were not accepted by JHALCO.
Reference was then
made to the earlier Order dated 9.5.2003 of this Court and it was pointed out
further that by Order dated 13.9.2004, the State Government had decided that as
on date, BHALCO continued to be under the control of the Government of Bihar.
In para (i), a very curious statement is made, which is as under:
14 "Therefore,
after the Central Government order dated 13.9.2004, the Jharkhand State
Government sought to annul its earlier decision to correct the technical error
committed earlier in its order no. 2580 dated 29.12.2001 issued by Water
Resource Department, Government of Jharkhand for which approval was given to
this proposal by the Departmental Minister in October 2004. However, the
process could not be completed because of elections in the State. Thereafter,
the Cabinet revised its earlier decision in its meetings of 4.4.2005 and the
order was issued vide WRD, Government of Jharkhand notification no. 1283 dated
26.4.2005."
- A
reference was then made to an application for modification of this Court's
Order dated 13.1.2005, allegedly filed by the State of Jharkhand on
15.2.2005. Further, the rejoinder affidavit filed by the State of
Jharkhand dated 28.4.2005, showing the inability to absorb the remaining
BHALCO employees was also referred to. Paragraph 8 (a) and 8 (b) of this
additional affidavit suggested that JHALCO had adopted the rules and
regulations of BHALCO, and that JHALCO will receive assistance from
financial institutions. It is then admitted that to start and run JHALCO,
experienced employees were needed. As BHALCO employees were sitting idle,
an opportunity was given to them on humanitarian grounds.
Again, the same table
regarding the 302 absorbed employees was presented. It is then reiterated that
the financial position of JHALCO could not be improved due to the excess staff
already absorbed. In para 8 (e), a reference was made to the decision of the
Government of Jharkhand issued by WRD notification no. 1283 dated 26.4.2005 and
a meeting in pursuance of this decision held on 8.8.2005 to review the
financial position 15 of the JHALCO together with its work performance. This
para is extremely important and reads as under:
"(e) As per
Government of Jharkhand decision issued by WRD notification no. 1283 dated
26.4.2005 the Board of Directors of JHALCO held a meeting dated 8.8.2005 to
review the financial position of JHALCO together with its work performance. It
decided to curtail the number of the employee, seeing the nature of the work
which the corporation is executing, as all schemes are executed by the
beneficiary of the concerned schemes and handed over to the beneficiary
committee after completion of the scheme. The strength sanctioned by Board of
Directors is as under:
S.No. Category of
Post Total Engaged Employees (i) Officers 78 (ii) Class III 44 (iii) Class IV
92 Total = 214 (f) In view of the strength sanctioned by the Board of Directors
of JHALCO seeing the nature of the work executed by the corporation the
comparative statement of BHALCO employees already engaged in JHALCO in
comparison to its need strength is as under:
Sl. Category of Total
Total Balance NO. Post strength engaged sanctioned employees (i) Officers 78 14
(-)64 (ii) Class III 44 44 Nil (iii) Class IV 92 244 (+) 152 The above
comparative statement itself shows that 152 excess of BHALCO Class IV employees
have already 16 been engaged, regarding which an affidavit has been filed by
the Government of Jharkhand in the Hon'ble Supreme Court.
(g) The remaining
BHALCO employees are approximately 216. As per I.A.-21 filed by the petitioner
(BHALCO employees) category wise position of these employees are as follow:
S.No. Category of Post
Remaining BHALCO Employees (i) Officers 05 (ii) Class III 31 (iii) Class IV 180
Total = 216 (h) As mentioned above in the remaining 216 employees of BHALCO,
Class III employees are 31 which are not needed in JHALCO and Class IV
employees are 180 while JHALCO has already engaged 152 excess Class IV
employees of BHALCO.
(i) As per audit
report 2005-06, JHALCO is already running in 3.16 crores deficit.
(j) The annual wages
of JHALCO employees is about 3.60 crores, while the profit earned by JHALCO has
been estimated to be approximately Rs. One crore. Thus, 2.60 crores have been
sought from the WRD, State of Jharkhand to make the JHALCO employees payment
for the financial year 2008-09".
- It
was then submitted in the further paragraphs that JHALCO was trying to
become financially viable with the help of the Government of Jharkhand. It
was also pointed out that in the erstwhile BHALCO, excess employees were
engaged and the organization could not sustain the burden of its
employees. It was, therefore, reiterated that the estimate of 17 taking
the remaining BHALCO employees had to be seen in the light of the
precarious financial situation and the excess staff. It was, therefore,
reiterated that if those employees are taken, JHALCO also will be a sick
company. In the rest of the paragraphs, other facts relating to the
liquidation of BHALCO, as also the failure of the meeting dated 17.1.2008
which was ordered by this Court, were referred.
- We
have deliberately referred to the two affidavits on behalf of the State of
Jharkhand and JHALCO only to show that JHALCO and the State are changing
their stands from time to time. Their stands at times have become
contradictory and inexplicable. It has already been noted that JHALCO came
into existence long back on 29.12.2001, because the area of operation of
BHALCO fell within the boundaries of Jharkhand after the State of
Jharkhand came into existence. The Cabinet note dated 9.1.2002 which was
filed by the writ petitioner along with I.A. no. 11 of 2005 clearly
suggests that the Jharkhand State Cabinet had sanctioned that BHALCO
should be run in the form of JHALCO. In 2003, JHALCO gave two
advertisements for absorption of BHALCO employees and even later, it was
admitted that JHALCO required the experienced employees of BHALCO. In
pursuance of these advertisements, all the BHALCO employees could have
applied for being regularized, provided, their applications were found to
be in order. Accordingly, as many as 302 employees were absorbed. The
applications of others were rejected and 18 some others had not applied
at all, perhaps because of the condition that such employees had to forego
their earlier claims of the unpaid salaries. At the time when the
advertisements were issued, there was no compulsion by way of any Court
Order to accommodate all the employees and it could have been merely a
humanitarian consideration out of which the said advertisements came to be
issued. It cannot be forgotten that there was no trained staff available
with JHALCO and, therefore, JHALCO required the experienced staff of
BHALCO. Therefore, this move was only to replace the nomenclature of
BHALCO and to continue the same as JHALCO. It seems that the non-payment
of salaries to these employees was a non-factor and, therefore, JHALCO
wanted to reap double benefit, viz., firstly it could get all the
experienced employees and secondly, that too without having to face the
liability of their salary payments. It must be remembered that all this
was in the wake of this Court's Order dated 9.5.2003, wherein, this Court
had required the State of Bihar to deposit a sum of 50 crores of rupees
for disbursement of the salaries to the employees of the corporations and
also had directed the disbursement of the funds to the needy employees on
ad-hoc basis. The Court had also directed creation of a committee for
scrutinizing the assets and liabilities of the companies. Therefore, when
the advertisements were issued with the cut-off date of 7.8.2003, JHALCO
had a distinct advantage. However, thereafter, came the Order of this
Court dated 13.1.2005, whereby, this Court took the notice of coming into
being of JHALCO and further directed 19 that the concerned employees who
were to be absorbed, need not give an undertaking of foregoing their
claims for the past unpaid salaries. Till then, it seems from the language
of the Order dated 13.1.2005, that no formal Order was passed for
absorption. Probably, therefore, this Court gave six weeks' time to such
employees. Again as in the earlier advertisements, only the employees foregoing
their claims over salaries could apply, all the employees probably did not
apply restricting the number only to 302. Now, in pursuance of the Order
dated 13.1.2005, 216 more employees had applied and that too without
foregoing their claims over salaries. It is probably because of this that
a decision was taken in a meeting dated 8.8.2005 to review the financial
position of JHALCO, to curtail the number of employees and to limit the
total number of employees to 214. In fact, if paragraph A(f) of the Additional
affidavit is seen, it will be clear that though there were 152 excess
Class IV employees, there was still requirement of 64 Officers, as only 14
Officers were engaged as against the total sanctioned strength of 78
Officers. This exercise of curtailing the employees and limiting the total
number of employees to 214 appears to be a deliberate exercise in the wake
of the Order dated 13.1.2005 of this Court, and incidentally, even that
Order was not followed in its true spirit which ultimately required the
petitioners to file I.A. no. 11. Even the figures given in the Additional
affidavit's paragraph A(f) are misleading. If properly calculated as
against the total sanctioned strength of 214, 302 employees were engaged.
Thus, only 88 excess employees could be said to have 20 been engaged and
that too prior to the decision dated 8.8.2005. The figure of 152 as the
excess employees, is, therefore, clearly misleading. There does not appear
any explanation, nor any statistics to justify the curtailing of the employees
by JHALCO. After all, there was no curtailment of area or the activities
at least none pleaded before us, in which case the decision to curtail the
number of employees of JHALCO itself appears to be neither sound,
reasonable, nor justifiable and only appears to get out of the rigour of
this Court's Order dated 13.1.2005. Be that as it may we are, in view of
the discussions made thereafter, not in a position to pass any order in
favour of the applicants even if their contentions with regard to existence
of vacancies are accepted.
- However,
there is a huge problem of the finance. It has been pleaded in the
Additional affidavit that JHALCO was running in deficit by 3.16 crores up
to 2005-06. Its annual wages on the date are 3.60 crores and it has already
sought 2.60 crores from the State of Jharkhand to make the payment for the
financial year 2008-09. The affidavit, however, does not give any clear
idea about the contribution which will be required to be made by the State
of Bihar on account of the arrears of salaries.
- When
we see the response of the State of Bihar, barring reference to the letter
dated 22.1.2001 by the Secretary of the Government of Bihar to the
Secretary of the Government of Jharkhand recommending that all the 21
employees of BHALCO should be absorbed in JHALCO without any condition,
their does not appear to be anything more. In the name of written
submissions on behalf of State of Bihar, all that is stated is that since
BHALCO was a corporation situated in the State of Jharkhand and its area
of operation was also in the State of Jharkhand, only, therefore, under
Section 47 (1) and Section 56 of the Bihar Reorganisation Act, 2000,
BHALCO is a corporation of the Government of Jharkhand with all its
liabilities and assets. The State of Bihar then further has reiterated
that the decision of the Central Government to treat BHALCO as a property
of the State of Bihar and direction given vide letter dated 13.9.2004 to
take steps for liquidation of BHALCO is not correct decision, and that it
had written a letter to reconsider the same. We express our surprise as to
how such a bald stand was taken by the State of Bihar. Seen from any
angle, this liability could not be altogether shaken off by the State of
Bihar to avoid the same on the specious plea that BHALCO has now become
JHALCO. That would be the over simplification of the issue. That is apart
from the fact that in the Memorandum of Association of BHALCO, there is a
reference of the six districts of Bihar which continued to be in the State
of Bihar as its area of operation. We have carefully seen the Order dated
13.9.2004 which is binding on the State of Bihar. By that Order, the
Central Government had ordered that the State Government of Bihar will
initiate liquidation in respect of BHALCO. If that is so, then by the
necessary logic, 22 the liability to pay the arrears of salary is that of
State of Bihar, which it must discharge.
- However,
we are told that a writ petition is pending in the Jharkhand High Court by
the employees claiming absorption as also the past salaries.
We would, therefore,
desist from giving final directions, so also we do not wish to deal with a
labour dispute in a public interest litigation directly filed before this
Court. It would be better if all the questions pending in the said writ
petition are finally decided as early as possible.
There is another
aspect of the matter which cannot be lost sight of.
The mode of enforcing
our order dated 13th January, 2005 would be by initiating a proceeding for
contempt under the Contempt of Courts Act, 1970. Such a proceeding, as is well
known, must be initiated by way of last resort.
In Sushila Raje
Holkar vs. Anil Kak (Retd.) [2008(7) SCALE 484], this Court held :
"14. A
proceeding under the Contempt of Courts Act has a serious consequence. Whether
the alleged contemnor has willfully committed breach of the order passed by a
competent court of law or not having regard to the civil/evil consequences
ensuing therefor require strict scrutiny. For the said purpose, it may be permissible
to read the order of the court in its entirety. The effect and purport of the
order should be taken into consideration.
Whereas the court
shall always zealously enforce its order but a mere technicality should not be
a ground to punish the contemnor.
23 A proceeding for
contempt should be initiated with utomost reservation. It should be exercised
with due care and caution. The power of the court in imposing punishment for
contempt of the court is not an uncontrolled or unlimited power. It is a controlled
power and restrictive in nature (see Re: P.C. Sen [ (1969) 2 SCR 649] and
Jhareswar Prasad Paul and Another vs. Tarak Nath Ganguly & Ors. [(2002) 5
SCC 352]}.
A contemnor, thus,
may be punished only when a clear case for contumacious conduct has been made
out."
Only because an
incorrect statement had been made before us in respect whereof we have made our
comments hereto before, initiation and consequent punishment of the officers
guilty before us therefor, in our opinion, would not subserve any purpose. We,
therefore, desist ourselves from doing so.
- In
view of the above, we give the following directions:
(A) The High Court of
Jharkhand is requested to dispose of the writ petition pending before it at the
earliest and, if possible, within six weeks from date. If the High Court finds
it difficult to dispose of the matter within the aforementioned period, it may
pass interim order as it may deem fit and proper. It is made clear that in the
event the High Court finds that the applicants were entitled to be absorbed in
the services of JHALCO from an earlier date it would be open to it to pass such
an order as it may deem fit and proper so as to adjust the equities between the
parties. It is made clear that the question of final 24 absorption, past salaries
and the liability to pay the same may be determined by the High Court in the
said writ petition.
(B) Managing
Director, BHALCO and Managing Director, JHALCO as also the Secretaries of the
Government of Bihar and the Government of Jharkhand shall meet within one month
from the date and decide upon and assess the liability on account of the
arrears of the salaries payable to the employees already absorbed and to be
absorbed, and make a report thereof within a week of the date of decision, to
the High Court for taking final decision regarding the mode of payment etc. to
the employees, if any, so that the liability of JHALCO to that extent would
stand reduced.
(C) The Central
Government shall take immediate steps to see that the directions in the order
dated 13.09.2004, passed by it are complied with by the State of Bihar The
Interim Application is accordingly disposed of.
......................................J.
(S.B. Sinha)
......................................J.
(V.S. Sirpurkar)
25
New Delhi;
July
8, 2008.
26 Digital Performa
Case No. : IA No.21 of 2007 In WP(C) No.488/2002 Date of Decision : 8.7.2008
Cause Title : Kapila Hingorani & Anr. Versus State of Bihar & Anr.
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