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TMI Blog1983 (1) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... the benefits because before they came to work under the Panchayat Institutions, they were employed in municipalities while the others were Government servants to start with. The unfairness and the injustice of the distinction is patent, whatever legal justification may be put forward. Surely, the State, dedicated as it is to socialism, equality and economic justice and enjoined by the Directive Principles to secure the right to work, a living wage, equal pay for equal work and so on cannot make such a distinction But the distinction has been made; it is sought to be sustained by those making it and we are constrained to examine whether there is any Constitutional or other legal sustenance for the distinction. We did request the Counsel for the State of Gujarat to communicate with his clients to find out if the benefits cannot gracefully be extended to the erstwhile employees of municipalities presently working under Panchayat Institutions also. We are told that the answer of the State of Gujarat is in the negative. The appeal and the Writ Petitions were heard once before by a Constitution Bench consisting of Chandrachud, CJ, Sarkaria, Untwalia, Kailasam and Venkataramiah, JJ. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e under the Land Revenue Code. The Gram Panchayat, the Nagar Panchayat, the Taluqa Panchayat and the District Panchayats are to be bodies corporate with perpetual succession and common seal. Sec. 8 prescribes the hierarchy and provides that, subject to the control of the Government, a Gram Panchayat is to be subordinate to the Taluqa Panchayat and the District Panchayat, while a Nagar Panchayat and Taluqa Panchayat are to be subordinate to the District Panchayat. While the Gram Panchayats, Nagar Panchayats, Taluqa Panchayats and District Panchayats are to be bodies corporate, Sec. 287 makes it explicit that, notwithstanding that they are separate bodies corporate having distinct territorial jurisdiction and territorial functions to perform, the Gram Panchayats, Nagar Panchayats, Taluqa Panchayats and District Panchayats shall form part of the panchayat organisation, set up for the purpose of securing a greater measure of participation by the people of the State in local government functions and shall perform the functions and duties assigned to them by or under the Act so as to conform to the State plans, National plans and the State policy in general, and also so as to give effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ombay Local Boards Act stand transformed as District Panchayats, village panchayats under the Bombay Village Panchayats Act as gram panchayats and municipalities under the Bombay District Municipal Act and Bombay Municipal Boroughs Act as gram or nagar panchayats, depending on the population. Officers and servants in the employ of the District Local Boards are deemed to be transferred to the service of the district panchayats; Secretaries, officers and servants in the employ of the old village panchayat become Secretaries, officers and servants of new gram panchayats and officers and servants in the employ of municipalities become officers and servants of interim panchayats. To continue our tour of inspection (if one may use such an expression) of the provisions of the Act, Sec. 88 of the Act empowers each gram panchayat to make, in the area within its jurisdiction, and so far as the fund at its disposal will allow, reasonable provision in regard to all or any of the matters specified in Sch. I. Sch. I enumerates a host of matters under the heads 'Sanitation and Health 'Public works', 'Education and Culture', Self Defence and Village Defence', 'Planni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ID Schedule III, similarly, a number of subjects are enumerated under the heads 'Sanitation and Health', 'Public Works', 'Education and other Cultural Activities', 'Administration', 'Community Development', 'Agriculture', 'Animal Husbandry', 'Village and Small Scale Industries', 'Social Welfare', 'Relief' and 'Minor Irrigation Projects'. Sec. 155 provides for the transfer of the functions previously performed by District School Boards under the Bombay and Saurashtra Primary Education Act to taluqa and district panchayats. Sec. 156 provides for the delegation to district and taluqa panchayats such powers and functions and duties of the Registrar or any other authority under the Bombay Cooperative Societies Act, as may be specified. Sec. 157 provides for the transfer to District Panchayats of such powers, functions and duties relating to any matters as are exercised or performed by the State Government or any officer of the Government under any enactment which the State Legislature is competent to enact, or otherwise in the executive power of the State. On the transfer of such functions, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Panchayat every road building or other work constructed by the Panchayat, any land or property transferred to a District Panchayat by the State Government and any land or other property transferred to the District Panchayat by any other Panchayat, We may now refer, conveniently, at this stage to the provisions relating to services. Sec. 102 provides that there shall be a Secretary for every gram panchayat and nagar panchayat, who shall be appointed in accordance with the rules. Rules, of course, have to be made by the Government under Sec. 323. Sec. 102 also provides that a gram panchayat and nagar panchayat may have suck other servants as may be determined under Sec. 203, who shall be appointed by such authority and with such conditions of service, as may be prescribed. 'Prescribed' again means 'prescribed by rules' and rules have to be made by the Government. It is further provided that having regard to the population of a gram and its income, the State Government may direct that a group of gram panchayats shall have one Secretary only. The Secretary is required to keep in his custody all records and registers of the panchayats, issue receipts on behalf of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and uniform conditions of service for persons employed in the discharge of functions and duties of Panchayats. Such service, it was declared, shall be distinct from the State Service. The panchayat service was to consist of such classes, cadres and posts and the initial strength of officers and strength of such classes cadres and posts was to be such as the State Government might determine from time to time. District Panchayats were empowered to alter, with the previous approval of the State Government, any class, cadre or number of posts determined by the Government. The cadres were to consist of district cadres, taluqa cadres and local cadres. A servant belonging to a district cadre was liable to be posted, whether by promotion or transfer, to any post in any taluqa or of the district. A servant belonging to the taluqa cadre was liable to be posted whether by promotion or transfer to any post in any gram or nagar in the same taluqa. A servant belonging to a local cadre was liable to be posted whether by promotion or transfer to any post in the same gram or nagar. In addition to the posts in the district taluqa and local cadres, a panchayat might have such other posts of such cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent on loan. Sec. 210 provides for the constitution of a Panchayat Services Selection Board and Sec. 211 provides for the constitution of District Panchayat Service Selection Committees and District Primary Education Staff Selection Committees. The broad and general picture that we have on a perusal of the relevant provisions of the Act, as it stood before it was amended in 1978, is that the Gujarat Legislature aimed at the democratic decentralization of important governmental functions by vesting such functions in gram, nagar, taluqa and district panchayats (see Sec. 88 read with Sch. I, Sec. 117 read with Sch. II and Sec. 137 read with Sch. III) and, besides, by enabling the State Government to transfer other powers, functions and duties to the Panchayat institutions (see Secs. 89, 149, 150, 155, 156, 157 and 158). A perusal of the lists of subjects entrusted to the Panchayat Institutions shows that they are not merely the ordinary run of subjects entrusted to municipal bodies, such as, public health, sanitation, etc, but they include a great variety of subjects intimately connected with all aspects of community life and vital to it, except functions, such as, law and order, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ec. 203 (2) directing that the Panchayat service shall consist of district cadre, taluqa cadre and local cadre and further specifying the posts which belonged to each of the cadres. Amongst the rules made were the Gujarat Panchayat Service (Absorption, Seniority, Pay. and Allowances) Rules, 1965, which provided for the equation of posts, fixation of seniority, scales of pay and allowances of allocated employees . Allocated employees' were defined in the rules to mean persons allocated to the panchayat service under the provisions of Sec. 206 (i). The rules provide that every allocated employee holding a corresponding post, immediately before the appointed day, shall be appointed to the equivalent post. Equivalent post is defined to mean a post in the panchayat service, which the State Government may, by order, determine to be generally corresponding to a post held by an allocated employee immediately before the appointed day (called corresponding post) having regard to the pay scales, the minimum educational and other qualifications prescribed for the equivalent post and the corresponding post and the nature and magnitude of responsibilities attached to such posts. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s whom they represent in the equivalent posts in the Panchayat Service in accordance p with the provisions of the Gujarat Panchayats Service (Absorption, Seniority, Pay and Allowances) Rules, 1965 and simultaneously give to them the benefit of such of the accepted recommendations of the First Pay Commission (Sarala Commission) in the said matters as were extended to the other officers and servants of the Panchayat Service; alternatively, having initially fixed the pay scales, allowances and other conditions of service in the equivalent post in accordance with the said rules, to revise subsequently such pay scales and other conditions of service as per the accepted recommendations of the First Pay Commission (Sarala Commission) in the said matters with effect from February 11, 1969. (3) To further revise the pay scales and allowances and other conditions of service, including the grant of house rent allowance, compensatory local allowance, leave benefits, medical benefits, retirement benefits, etc. of the Second Pay Commission (Desai Commission) in the said matters and to give effect to such revision on and with effect from January 1, 1975. (4) To extend to the petitioners and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the right to appoint, the right to terminate the employment, the right to take other disciplinary action, the right to prescribe the conditions of service, the nature of the duties performed by the employee, the right to control the employee's manner and method of the work, the right to issue directions and the right to determine and the source from which wages or salary are paid and a host of such circumstances, may have to be considered to determine the existence of the relationship of master and servant. In each case, it is a question of fact whether a person is a servant of the State or not. Amongst the cases cited before us were Guru Govinda Babu v. Sankar Prasad Ghosal(1), State of Uttar Pradesh v. Audh Narasin Singh(2), State of Assam v. Shri Kanakchandra Dutt(3), Gurushantappa v. Abdul Khuddus(4) S.L. Aggarwal v. Hindustan Steel Ltd.(5) and Jalgaon Zila Parishad v. Duman Gobind and others(6). We have considered all of them and do not consider it necessary to refer to each of them. We may now revert to the question whether the members of the Gujarat Panchayat Service are Government servants. First, we see that the duties which they are required to perform are in conn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Panchayat Service is also a service under the State. Again Sec. 203 (5) requires that rules may provide for inter-district transfers of servants belonging to the panchayat service and the circumstances in which and the conditions subject to which such transfers may be made This provision along with the provisions of Sec. 203 which provide for the promotion and transfer of servants belonging to the district, taluqa and local cadres within the district taluqa and gram or nagar clearly show that the servants are not the servants of the individual panchayats but belong to a centralised service. Sec. 205 provides that appointments to posts in the Panchayat service shall be made (i) by direct recruitment, (ii) by promotion or (iii) by transfer of a member of the State service to the Panchayat service. This provision which enables an appointment to be made to a post in the Panchayat Service by transfer of a member of the State service necessarily implies that the panchayat service is also a service under the State. Secs. 157 and 158 provide for the transfer of certain functions performed by the Government to Panchayat Institutions together with funds and staff. Sec. 325, as we have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubsidiary Government. It is only in that sense Panchayat Service is distinct from a State Service and not in the same that members of the service are not servants of the State. It is also argued that the several Panchayat Institutions are declared to be bodies corporate by the Act and, therefore, their servants cannot be Government servants. We are unable to see any force in the submission. Government servants do not cease to be Government servants merely because, for the time being, they are allotted to different Panchayat Institutions and are paid out of the funds of those institutions. We have already explained why the servants belonging to the various cadres of the Panchayat service cannot be considered to be servants of individual panchayats. It is unnecessary to pursue the matter further. We are, therefore, of the view that the Panchayat Service constituted under Sec. 203 of the Gujarat Panchayats Act is a civil service of the State and that the members of the service are Government servants. This very question had been decided by the High D Court of Gujarat more than 15 years back in G.L. Shukla and Anr. v. The State of Gujarat(1) and there appears no good reason to de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .................................... The mode of recruitment, the conditions of service and matters relating to appointments, transfers and promotions of persons employed in the panchayat service as also disciplinary action against them are all determined by the State Government and that is consistent only with the State being the master in the entire panchayat service. The mandatory provision for promotion from panchayat service to State service which is required to be made in the rules also shows that both the services are services of the State. There could be no question of promotion from one service to another if the masters in the two services were different. Then it would be a case of termination of one service and appointment to another ..................................... ............................................................ Then comes Sec. 206 which provides for making of an order of allocation to the panchayat service ..................... ............................................................ This provision relating to allocation of officers and servants under clauses (i) and (iii) does not contemplate any termination of service of such officers and serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernment to discharge its statutory duty to make orders for the equation of posts and to extend the benefits arising out of the reports of the two Pay Commissions, which benefits bad been denied to the local cadre only. The obligation to make provision for the payment of salaries, allowances and other benefits to Government servants did not cease by their being allocated to Panchayat Institutions, notwithstanding that Sec. 204 places an obligation on the Panchayat under whom an officer or servant of the Panchayat service may service for the time being to meet the expenditure towards the pay, allowances and benefits available to such officer or servant. We do not have any doubt that the case was correctly decided by the High Court and that the appeal deserves to be dismissed with costs which we quantify at ₹ 15,000. We then come to the Writ Petitions. As mentioned by us earlier the Gujarat Panchayats Act was amended during the pendency of the appeal in an effort to nullify the effect of the judgment of the Gujarat High Court. First, the Government promulgated an ordinance and next the legislature enacted the Amending Act. Sec. I of the Amending Act stipulates the dates fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made and the rules for regulating recruitment and conditions of service of such Secretary shall be such as the Panchayat may, subject to general or special order of the State Government, by its resolution determine . The provision in the original s. 102 (1) (b) which enabled the Gram panchayat or Nagar panchayat to have such other servants as may be determined under s. 203 and which provided that such servant shall be appointed by such authority and their conditions of service shall be such as may be prescribed was omitted and in its place a new s. 102 (1) (b) was substituted enabling the Gram panchayat itself to appoint such servants as may be necessary for the proper exercise of its powers, discharge of duties and performance of functions and further providing that the rules for regulating recruitment and conditions of service of such servants shall be made by the Punchayat itself. An explanation was added to say that the expression 'servants' included a Secretary referred to in the proviso to cl. (a). A further cl. (c) was introduced after cls. (a) and (b) of s. 102 (1) and it is as follows: Notwithstanding any thing contained in any judgment, decree or order of any co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... functions and duties of panchayats and declared that such service shall be distinct from the State Service, the new sub-sec. (1) introduced by cl. (l) of s. 6 of the Amending Act, is as follows: '(1) In order to enable taluka panchayats and district panchayats to exercise their powers, discharge their duties and perform their functions effectively and efficiently, there shall be constituted a Panchayat Service consisting of persons employed in connection with the affairs of taluka panchayats and district panchayats and of specified servants, and notwithstanding anything contained in any judgment, decree or order of any court such persons and Servants shall be and shall be deemed to have always been the officers and servants of the taluka panchayats or, as the case may be, the district panchayats. Explanation-In this sub-sec., the expression specified servants means- (a) talatis-cum-Panchayat secretaries discharging the functions of gram Panchayat or of nagar panchayats, and (b) kotwals. See. 203 (2A) was amended by omitting reference to local cadres Old Sec. 203 (4) (a) which obliged the making of a rule containing a provision entitling servants of such cadres i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etaries of new gram panchayats and kotwals . In the rest of S. 206 wherever the words 'the panchayats' were used, the words 'the district and taluqa panchayats' were substituted. The real effect of S. 8 of the Amending Act is to take out all officers and servants of the municipalities dissolved under S. 307 from the applicability of S. 206 though S. 206 is made otherwise applicable to all other categories of officers and servants allotted to a panchayat. By S. 10 of the Amending Act, two new sections S. 206 (AB) and S. 206 (AC) are introduced, the object of which is really to give options to those officers and servants who are allotted or transferred to panchayats, under the various provisions of the Act. These provisions are obviously introduced to defeat an argument that allotment and transfer of Government servants to a non-Government service is violative of Art. 311. By Sec. 14 of the Amending Act, a new Sec. 21 I(A) is introduced the effect of which is that the allocation of officers and servants of erstwhile municipalities and officers and servants of old village panchayats was to cease and those officers and servants were to be deemed to have always b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s argued that there was good reason for the classification and that in the circumstances of the case, the classification was legitimately made with retrospective effect. It is here necessary to recapitulate a few facts. When the Panchayat Service was initially constituted soon after the passing of the Gujarat Panchayats Act, there were three cadres, the district cadre, the taluqa cadre and the local cadre. Secretaries, officers and servants of the old village panchayats under the Bombay Village Panchayats Act, 1958 became Secretaries, officers and servants of the new Gram Panchayats under s. 325 (2)(x) of the Gujarat Panchayats Act, 1961. Talatis and Kotwals, who were Government servants were Secretaries and officers of the old village panchayats under the Bombay Village Panchayats Act and so they became secretaries and officers of the new gram panchayats under the Gujarat Panchayats Act, 1961. Some municipalities constituted for municipal districts and municipal boroughs under the Bombay District Municipal Act and the Bombay Municipal Boroughs Act as applied to areas in the State of Gujarat, were converted into gram and nagar panchayats under s. 307 of the Gujarat Panchayats Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the provisions of Art. 311 of the Constitution. Nor was it permissible to single them out for differential treatment. That would offend Art. 14 of the Constitution. An attempt was made to justify the purported differentiation on the basis of history and ancestry, as it were. It was said that Talatis and Kotwals who became Secretaries, officers and servants, of Gram and Nagar Panchayats were Government servants, even to start with, while municipal employees who became such secretaries, officers and servants of Gram and Nagar Panchayats were not. Each carried the mark or the 'brand' of his origin and a classification on the basis of the source from which they came into the service, it was claimed, was permissible. We are clear that it is not. 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. Such a clarification would be unreasonable and entirely irrelevant to the object sought to be achieved. It is to navigate around these two obstacles of Art. 311 and Art. 14 that the Amending Act is sought to be made restrospective, to bring about an artificial situation as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al provisions in the context of the existing situation 3 cannot become valid by being made restrospective. Past virtue (constitutional) cannot be made to wipe out present vice (constitutional) by making retrospective laws. 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. We have considered the question whether any provision of the Gujarat Panchayats (Third Amendment) Act, 1978 might be salvaged. We are afraid that the provisions are so interwined with one another that it is well-nigh impossible to consider any life saving surgery. The whole of the Third Amendment Act must go. In the result the Writ Petition Nos 4266-70 are allowed with costs quantified at ₹ 15,000. The directions given by the High Court, which we have cor firmed, should be complied with before June 30, 1983. In the meanwhile, the employees of the Panchayats covered by the appeal and the Writ Petitions will receive a sum of ₹ 200 per month over and above the emoluments they were receiving before February 1, 1978. This order will be effective from February 1, 1983 The interim ..... X X X X Extracts X X X X X X X X Extracts X X X X
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