2006 (4) TMI 565 - SC - Indian Laws

Summary

Issues Involved:
1. Absorption of employees from U.P. Jal Nigam into the Development Authorities Centralized Services.
2. The validity of conditions imposed by the State for such absorption.
3. Seniority determination for absorbed employees.
4. Allegations of discrimination and violation of Articles 14 and 16 of the Constitution of India.
5. The applicability of Rule 7 of the Uttar Pradesh Development Authorities Centralised Services Rules, 1985.
6. The impact of the notification dated 9.12.2002 on the seniority and absorption of employees.

Issue-wise Detailed Analysis:

1. Absorption of employees from U.P. Jal Nigam into the Development Authorities Centralized Services:
The respondents, initially appointed in U.P. Jal Nigam, were deputed to the Ghaziabad Development Authority on diverse dates. U.P. Jal Nigam is not a development authority, and its employees on deputation to development authorities could not be absorbed in the centralized services under Section 5-A of the Uttar Pradesh Urban Planning and Development Act, 1973. Despite this, options were called from U.P. Jal Nigam officers on deputation for absorption into the centralized services, with specific conditions regarding seniority and past service.

2. The validity of conditions imposed by the State for such absorption:
The conditions imposed by the State for absorption included that past services rendered in U.P. Jal Nigam would not be counted for seniority, and absorbed officers would be placed below those appointed on a regular basis in the centralized service. The respondents accepted these conditions without demur, exercising their right of election. The court held that once such an option is exercised, the consequences attached thereto would ensue, and the respondents could not later challenge these conditions.

3. Seniority determination for absorbed employees:
The seniority of the appellants, who were appointed directly to various development authorities, was determined under Rule 7 of the Uttar Pradesh Development Authorities Centralised Services Rules, 1985. The respondents, having been absorbed from U.P. Jal Nigam, were placed below the appellants in the seniority list. The court emphasized that seniority is not a fundamental right but a civil right, and the terms and conditions of service, including seniority, are governed by statutory rules.

4. Allegations of discrimination and violation of Articles 14 and 16 of the Constitution of India:
The High Court had ruled that refusing to grant the benefit of past service to the respondents was violative of Articles 14 and 16. However, the Supreme Court held that the respondents, having accepted the conditions for absorption, could not claim discrimination. The court noted that the conditions were not arbitrary or unreasonable and were within the State's right to impose.

5. The applicability of Rule 7 of the Uttar Pradesh Development Authorities Centralised Services Rules, 1985:
Rule 7(1) of the 1985 Rules, as amended by the notification dated 9.12.2002, provided that the past services of only those officers absorbed under Section 5-A(2) of the Act would be counted towards seniority. The respondents were not absorbed under Section 5-A(2) and thus were not entitled to the benefits of Rule 7. The court held that the only applicable rule for seniority in this case was Rule 28, which determines seniority from the date of the order of appointment.

6. The impact of the notification dated 9.12.2002 on the seniority and absorption of employees:
The notification dated 9.12.2002 substituted Rule 7(1) to include services rendered in a Development Authority, Nagar Mahapalika, Nagar Palika, or Improvement Trust on similar posts for determining seniority. The court held that this notification did not apply to the respondents, as they were not absorbed under Section 5-A(2) of the Act. The court also noted that the respondents could challenge the validity of this notification if they were aggrieved.

Conclusion:
The Supreme Court set aside the High Court's judgment, holding that the respondents, having accepted the conditions for absorption, could not later claim benefits of past service for seniority. The court emphasized that seniority is governed by statutory rules, and the State was within its rights to impose conditions for absorption. The appeals were allowed, and the respondents were given the option to challenge the validity of the notification dated 9.12.2002 if they wished.