1983 (1) TMI 282 - SC - Indian Laws

Summary

Issues Involved:
1. Whether the members of the Gujarat Panchayat Service are Government servants.
2. The constitutional validity of the Gujarat Panchayats (Third Amendment) Act, 1978.
3. The retrospective application of the Gujarat Panchayats (Third Amendment) Act, 1978.
4. The differential treatment of ex-municipal employees in the Panchayat Service.
5. Compliance with the High Court's directions regarding pay scales, allowances, and other benefits for Panchayat Service members.

Issue-Wise Detailed Analysis:

1. Whether the members of the Gujarat Panchayat Service are Government servants:
The court examined whether the members of the Gujarat Panchayat Service are Government servants by considering various factors such as the right to appoint, terminate, and control the employees, the nature of their duties, and the source of their wages. The court concluded that the Panchayat Service constituted under Section 203 of the Gujarat Panchayats Act is a civil service of the State and that the members of the service are Government servants. The court noted, "The Panchayat Service is distinct from the State Service because the Panchayat institutions whom it serves together constitute an almost parallel but subsidiary Government."

2. The constitutional validity of the Gujarat Panchayats (Third Amendment) Act, 1978:
The court scrutinized the amendments introduced by the Gujarat Panchayats (Third Amendment) Act, 1978, which aimed to nullify the effect of the Gujarat High Court's judgment that declared Panchayat Service members as Government servants. The court found that the amendments were discriminatory and violated Articles 311 and 14 of the Constitution. The amendments attempted to retrospectively alter the status of ex-municipal employees, which the court deemed unconstitutional. The court stated, "We are, therefore, firmly of the view that the Gujarat Panchayats (Third Amendment) Act, 1978 is unconstitutional, as it offends Arts. 311 and 14 and is arbitrary and unreasonable."

3. The retrospective application of the Gujarat Panchayats (Third Amendment) Act, 1978:
The court addressed the issue of the retrospective application of the Amending Act, which sought to reclassify ex-municipal employees as non-Government servants with effect from February 24, 1962. The court held that such retrospective legislation could not be used to destroy accrued constitutional rights. The court emphasized, "Constitutional rights, constitutional obligations, and constitutional consequences cannot be tampered with by making retrospective laws."

4. The differential treatment of ex-municipal employees in the Panchayat Service:
The court examined the differential treatment meted out to ex-municipal employees compared to other members of the Panchayat Service. The court found that the classification based on the origin of employment (whether they were initially municipal employees or Government servants) was unreasonable and irrelevant once they joined the common stream of service. The court asserted, "Once they had joined the common stream of service to perform the same duties, it is clearly not permissible to make any classification on the basis of their origin."

5. Compliance with the High Court's directions regarding pay scales, allowances, and other benefits for Panchayat Service members:
The court upheld the Gujarat High Court's directions to the State Government to make suitable orders regarding the equivalence of posts, fixation of pay scales, and extension of benefits from the recommendations of the Pay Commissions to the local cadre. The court confirmed that the High Court had correctly directed the State Government to discharge its statutory duty. The court concluded, "We do not think that the High Court committed any error in issuing the directions which were consequential to its findings."

Conclusion:
The Supreme Court dismissed the appeal filed by the State Government and the Development Commissioner, upheld the Gujarat High Court's judgment, and declared the Gujarat Panchayats (Third Amendment) Act, 1978 unconstitutional. The court directed compliance with the High Court's orders before June 30, 1983, and provided interim relief to the affected employees. The court's decision emphasized the importance of adhering to constitutional principles and ensuring fair treatment for all members of the Panchayat Service.