1. With the consent of learned counsel for the parties since common questions of law and facts have been raised in all these matters, I proceed to decide these matters finally under the Rules of this Court at this stage by this common judgment.
2. In this bunch of writ petitions the core issue relates to the Government Order (hereinafter referred to as the "G.O.") No. Ve.Aa-2-27/Dus-59(M)/2008, dated 06.01.2011 issued by Sri Anoop Mishra, Principal Secretary, Finance U.P. Government, Lucknow addressed to various Principle Secretaries of different departments and Directors of different departments. The subject of G.O. is sanctioned Pay Band and Grade Band as modified/upgraded for Class-IV cadre of aided educational/technical educational institutions in the revised pay scale pursuant to 6th Pay Commission recommendation. Though in the writ petitions entire G.O. is challenged but during the course of arguments the learned counsels for petitioners have confined their attack only to Para 2 thereof. Para 2 says that in future no appointment on Class-IV posts (except the junior cadre of technical posts) shall be made and vacancies of Class-IV posts shall be managed by the system of outsourcing.
3. The relevant para 2 of G.O. dated 06.01.2011 reads as under:
^^2- eq>s ;g dgus dk funsZ'k gqvk gS fd Hkfo"; esa prqFkZ Js.kh ds fdlh Hkh in ¼dfu"B oxZ ds izkfof/kd inksa dks NksM+dj½ ij fu;qfDr ugha dh tk;sxh rFkk prqFkZ Js.kh ds fjDr gksus okys inksa ds lEcU/k esa dsoy vkÃ...V lksflZax ds ek/;e ls O;oLFkk dh tk;A ijUrq mDr O;oLFkk mRrj izns'k lsok dky esa e`r ljdkjh lsodksa ds vkfJrksa dh HkrhZ fu;ekoyh 1974 ds vUrxZr lewg ^^?k** ds inks ij dh tkus okyh fu;qfDr ds laca/k esa ykxw ugha gksxhA** "2. I am directed to say that in future appointments shall not be made on any Class IV posts (except on the junior cadre of technical posts ) and the Class IV posts falling vacant shall be managed only by outsourcing.
But the said provision shall not apply to the appointments to be made on the Group D posts under the Uttar Pradesh Recruitment of Dependents of Government Servants Dying in Harness Rules 1974."
( English translation by the Court)
4. Some of the writ petitions have been filed by Committee of Managements of Secondary Schools and Colleges challenging para 2 of G.O. dated 06.01.2011 as it deny them power of appointment on Class-IV posts in their respective educational institutions. Some of the writ petitions have been filed by candidates who have been selected for appointment on Class-IV posts for various secondary educational institutions but educational authorities have denied approval or recognition to such selection in view of the ban imposed vide para 2 of G.O. dated 06.01.2011.
5. The respondents-State of U.P. and its authorities have filed counter affidavit in some of the writ petitions and learned counsels for the parties have agreed to read the said counter affidavits in all matters. For referring the pleadings in counter affidavit, the parties have referred to Writ Petition No. 27387 of 2011 and this Court shall also proceed to refer pleadings in the aforesaid counter affidavit.
6. Sri Ashok Khare, Senior Advocate has advanced his submissions in Writ Petition No. 62476 of 2011, 62616 of 2011 and 74197 of 2011. Sri N.L. Pandey, Advocate in Writ Petition No. 11760 of 2011; Sri A.N. Rai, Advocate in Writ Petition No. 63197 of 2011 and Sri G.K. Singh, Advocate in Writ Petition No. 8492 of 2012 have made their submisisons. The other learned counsels appearing for petitioners have adopted the submissions advanced by the above learned counsels.
7. The basic ground of challenge is that the impugned G.O. is ultra vires of Section 16(G) of U.P. Intermediate Education Act, 1921 (hereinafter referred to as the "Act, 1921") and Regulation 100 Chapter III of Regulations framed under Act, 1921. It is even otherwise arbitrary, irrational and violative of Article 14 and 16 of the Constitution of India. Constituting an encroachment on managements' right to manage their institutions, it is also violative of Article 19 of the Constitution. It is also submitted that correctness of G.O. came to be examined by this Court in Writ Petition No. 36249 of 2011, Luv Kush Pandey Vs. State of U.P. and others, decided on 14.10.2011 wherein the Court did not decide the question of vires of aforesaid G.O. but held that the cases where vacancies occurred and selections were made before issuance of aforesaid G.O., the same would not be governed by aforesaid G.O.
8. Sri Ashok Khare, learned Senior Advocate submitted that Writ Petitions No. 62467 of 2011 and 74179 of 2011 are squarely covered by aforesaid judgment of Lucknow Bench in Luv Kush Pandey (supra).
9. Sri G.K. Singh, Advocate in particular submitted that G.O. is also not protected by reference to Section 9 of Act, 1921 inasmuch as every order is not referable to the said provision. It is applicable where immediate action is needed. The present G.O. is addressed to all the departments and not confined to educational institutions. By no stretch of imagination, even otherwise, it touches upon Section 9 of Act, 1921. He also placed reliance on a Division Bench judgment of this Court in Satish Kumar Vs. State of UP and others, 2006(4) ESC 2786 (para 34).
10. As already said, the respondents have filed their counter affidavits in some of the cases and the counter affidavit filed in Writ Petition No. 27387 of 2011 has been referred. It is pleaded therein that Chapter 2.2 para 2.2.9 of 6th Central Pay Commission Report Vol. 1 provides that a separate running Pay Band, designated as 1S scale is being recognized for posts belonging to Group-D. However, the same shall not be counted for any purpose as no future recruitment is to be made in this grade. All the present employees belonging to Group-D, who possess prescribed qualification, for entry level in Group-C, will be placed in Group-C Running Pay Band straightaway w.e.f. 01.01.2006. Other Group-D employees who do not possess qualification are to be retrained and thereafter be upgraded and placed in Group-C Running Pay Band. Till such time they are retrained and redeployed, they will be placed in 1S scale. The Pay Commission has said that 1S scale is not a regular or permanent pay scale and for the existing employees it shall operate only till the time, existing Group -D staff is placed in Group-C Running Pay Band. The mechanism for placing Group-D staff in revised Group-C Running Pay Band has been discussed in detail in Chapter 3.7 relating to Group-D staff. Group-D employees who are not placed in Group-C Pay Band straightaway will be given the band after retraining without any loss of seniority vis a vis those in Group-D who possessed higher qualification, redeployed and were placed in Group-C Running Pay Band w.e.f. 01.01.2006. It also refers to para 2.2.10 of 6th Pay Commission Report providing that so far as future recruitment is concerned no direct recruitment in 1S scale will take place and this scale will be operated for regulating emoluments during training period of candidates who do not possess the minimum qualification of matric. The Commission expressed its view that candidates not possessing minimum qualification of matric and/or ITI cannot be recruited in Government as all jobs in Government requires same level of skill.
11. Respondents have further pleaded, that, Since 6th Pay Commission Recommendations were implemented by State Government in respect to its employees also, a policy decision was taken regarding pay revision and the State Government issued G.O. No. Ve.Aa.-2-2052/Dus-59(M)/2008 dated 08.09.2010 applicable to various departments of State Government providing therein that no recruitment in future on Class-IV posts (except the lowest cadre of technical post) shall be made and future vacancies in Class-IV shall be managed by "outsourcing". The aforesaid G.O. was clarified by subsequent G.O. No. Ve.Aa.-2-3226/Dus-59(M)/2008 dated 04.01.2011 that restriction against future recruitment in Class-IV posts shall not be applicable for compassionate appointments. It was further clarified by another G.O. No. Ve.Aa.-2-26/Dus-59(M)/2008 dated 06.01.2011 (Annexure-CA-4 to the counter affidavit) issued to various departments of Government stating that benefit of revised pay and Grade Band would be notionally applicable from 01.01.2006 and actual benefit/payment shall be admissible w.e.f. 08.09.2010. In respect to educational institutions aided by State Government similar G.O. No. Ve.Aa.-2-27/Dus-59(M)/2008, dated 06.01.2011 was issued and in furtherance thereof the impugned G.O. dated 06.01.2011 has also been issued. By another G.O. No. 4/1/2008-Ka-2/2008 (Annexure-CA-6 to the counter affidavit) it was also clarified by Government that in outsourcing, provision of reservation shall also be observed strictly.
12. It is said that the G.O. dated 06.01.2011 having been issued in furtherance of acceptance of 6th Pay Commission, the recommendations whereof have been accepted by Government, it is not open to petitioners to challenge the same partly while retaining benefit of recommendations of 6th Pay Commission in all other aspects.
13. So far as recommendations relating to Pay Revision as made by 6th Pay Commission and accepted by Government that is a different matter since it is not the case of respondents that Pay Commission had the jurisdiction to deal with matter of recruitment and appointment of employees and officers of Government. In my view, it would not be necessary for this Court to look into this aspect further for the reason that validity of Para 2 of G.O. dated 06.01.2011 has to be considered in the light of statutory provisions of Act, 1921, the Regulations framed thereunder and also the Constitutional provision, i.e., Articles 14, 16 and 19.
14. Before coming to other aspects of the matter the Court finds it prudent to examine the meaning of the term "Outsourcing". It is neither a technical term nor a term of art. I also could not find its origin in the ancient times but appears to have gain momentum in recent past, i.e., with the advancement of managerial policies in the field of information technology etc. It is only when the scope, extent, purpose and objective of "Outsourcing" would be clear, it would be more convenient to examine the correctness of Para 2 of G.O. in the light of statutory provisions as referred to hereinabove and other relevant provisions which this Court shall discuss a bit later.
15. When this Court enquired from the learned Additional Advocate General as to what the Government mean by asking the educational institutions to go for "Outsourcing" instead of making recruitment of Class-IV posts, he simply replied that educational institutions shall not have to recruit any Class-IV employee on their own but may have their work done, meant to be performed by Class-IV employees, by employing persons from labour suppliers or the organizations engaged in the work of "Outsourcing". He was immediately confronted, whether it amounts to a contract labour supply to which he said that exactly that is not the purpose but to some extent there may be some similarity.
What is Outsourcing
16. When this Court proceed to consider the meaning and ambit of the term "Outsourcing"; immediate questions arise (a) what is outsourcing; (b) what can be outsourced; (c) where one can find outsourcing resources; and, (d) is it a unikind of system or multiple kind.
17. The term "outsourcing" is not a very commonly recognized term in various Dictionaries but some recent and revised editions contain this term and define it.
18. The "Concise Oxford English Dictionary Indian Edition" (11th Edition Revised) (2008) published by Oxford University Press, New Delhi at page 1017 defines the term "outsourcing" as under:
"Outsourcing-obtain by contract from an outside supplier."
19. "Wikipedia" describes the term "outsourcing" as "the process of contracting a business function to someone else". In the commercial word particularly among the managerial class, the term "Outsourcing" is known in various ways. According to some "Outsourcing" is any task, operation, job or process that can be performed by employees of company, but is instead, contracted to a third party for a significant period of time. Hiring a temporary employee when a regular employee in an institution is on leave is not "Outsourcing". According to some others "Outsourcing" is contracting with other company or persons to do a particular function. Normally outsourcing is resorted to such functions which are considered "non-core to the business". Another definition or meaning of "Outsourcing" is that it is simply farming out of services to a third party. The central idea, therefore, discerned from above is, that, "Outsourcing" is the process of contracting a function to someone else. Its opposite is "Insourcing".
20. "Insourcing" has been identified as a mean to ensure, control, compliance and to gain competitive differentiation through vertical integration or the development of shared services. "Insourcing" is also called as vertical integration.
21. "Outsourcing" is considered to be something more than purchasing and more than consulting. It is a long term results oriented relationship for a whole activity normally commercial over which the Provider has a large amount of control and managerial discretion. "Outsourcing" is the use of outside business relationship to perform necessary business activities and processes in lieu of internal capabilities. The most common forms of outsourcing presently known are "Information Technology Outsourcing" (ITO), "Business Process Outsourcing" (BPO) and Knowledge Process Outsourcing" (KPO). Business Process Outsourcing encompasses, Call Center Outsourcing, Human Resources Outsourcing, Finance and Accounting Outsourcing and Claims Processing Outsourcing.
22. The organizations want to seek "Outsourcing" normally take into account the issues like, cost savings, focus on core business, cost restructuring, improvement of quality, access and availability of better knowledge and experience, operational expertise, access to talent, capacity management, catalyst for change, enhancement for capacity of innovation, reduction of time in production of a product for supply to the market, Commodification, Risk Management, Tax Benefit, Venture Capital, Scalability, Creating Leisure Time, Reducing Liability, Revenue etc.
23. "Outsourcing", therefore, is the use of outside business relationship to perform necessary business activities and processes in lieu of internal capabilities. Those who provide "Outsourcing" facilities are called Outsourcing Partners, Outsourcing Suppliers and Providers. Those who go to purchase outsourcing services are called "Buyers" and "Users" in common parlance. The key to the definition of "Outsourcing" is the aspect of transfer of control. In Outsourcing, the Buyer normally does not instruct Supplier how to perform its task but, instead, focuses on communicating what results it want to buy. It leaves the process of accomplishing those results to supplier.
24. There are different kinds of outsourcing, namely, Tactical Outsourcing, Strategic Outsourcing, Transformational Outsourcing etc.
25. Though the term "outsourcing" as such has not been considered in detail by Courts but its purport and object can be discerned in the context the same has been referred to in certain decisions.
26. In Common Cause (A Regd. Society) Vs. Union of India and others, JT 2008 (4) SC 317 the Court considered a situation where a committee is appointed by the Court but with a further authority to issue orders to authorities or to public. Deprecating this practice in para 36 of the judgement the Court said:
"36. We would also like to advert to orders by some Courts appointing committees giving these committees power to issue orders to the authorities or to the public. This is wholly unconstitutional. The power to issue a mandamus or injunction is only with the Court. The Court cannot abdicate its function by handing over its powers under the Constitution or the C.P.C. or Cr.P.C. to a person or committee appointed by it. Such 'outsourcing' of judicial functions is not only illegal and unconstitutional, it is also giving rise to adverse public comment due to the alleged despotic behaviour of these committees and some other allegations. A committee can be appointed by the Court to gather some information and/or give some suggestions to the Court on a matter pending before it, but the Court cannot arm such a committee to issue orders which only a Court can do." (emphasis added)
27. The above discussion clearly suggest and demonstrate that outsourcing does contemplate performance of job or function or work by a body outside the buyer or purchaser and the service provided himself perform the job through its own agencies and it cannot be equated with the supply of labour or employees by a third party. The two connote different situations, functions and idea. They are not same and identical. In the system of labour supplier there is an introduction of middleman who make the workers available as a commodity without creating any employer and employee relationship with principle employer and the contract labour but outsourcing as such is not the involvement of a middleman for arranging the labour force bit it is the system where a particular kind of job or performance itself is performed by third party, i.e., the service provided through his own man and it is the own result which is made available to purchaser or buyer.
28. Regarding the merits and demerits of outsourcing there are different views but this Court is not required to go therein since the discussion about "Outsourcing" made above was only in furtherance to understand what the G.O. intend to do, in effect, and, whether in view of relevant provisions of statute, it is permissible to do so.
Relevant Statutes
29. The relevant statutes which have been referred to by both sides are Act, 1921 and U.P. High Schools and Intermediate Colleges (Payment of Salaries of Teachers and other Employees) Act, 1971 (hereinafter referred to as the "Act, 1971").
30. Act, 1921 is pre-constitutional enactment. Prior thereto the secondary education was also governed and managed by Allahabad University. Act 1921 was enacted to establish a Board to take place of Allahabad University for regulating and supervising High School and Intermediate Education system in U.P. and prescribe courses therefor. It constituted Board of High Schools and Intermediate, U.P. (hereinafter referred to as the "Board").
31. Here a question incidentally may also arise as to the status of "Board". This came up for consideration before a Division Bench of this Court in Ghulam Haqqani Khan Vs. State Of Uttar Pradesh And Ors, AIR 1962 Alld. 413. Two separat but concurrent judgments were rendered by Hon'ble B. Mukerji and S.C. Manchanda, JJ. The two questions formulated by Bench are stated in para 33a of the judgment, reads as under:
"(1) Whether the Board is a statutory authority, and if so, whether it is possible to create a statutory body as a department of Government?
(2) If the Legislature under Act II of 1921; has fixed the ambit and scope of the powers to be exercised by such statutory body can any one else interfere therewith or enlarge their scope?"
32. Hon'ble Manchanda, J. observed that the Legislature intended the Board to be independent only in certain respects subject to overriding fiscal and general administrative control of Government. It referred to and relied on a G.O. dated 13.04.1951 stating that the office of Board of High School is separate from that of Director of Education and appointments to higher clerical posts in any one of those offices are to be confined to clerks of that office only. This means that for certain purposes Board is treated separate from Education Department and normally higher clerical posts are not interchangeable. It further observed that there is no inherent impossibility in a statutory authority being at the same time a department of Government unless the Act itself, which creates the authority, gives it a separate legal status, i.e., provides it with the right of perpetual succession, a common seal, right to sue and to be sued in its own name. Such a body as the Board, cannot have a separate legal existence for all purposes. It must, necessarily, in the matter of administration and fiscal control, be under the authority of someone else. His Lordship also observed that:
"It is true that the Act itself nowhere says that it shall be a department of Government but when the historical background is taken into consideration the appointments of the staff from the very inception of the Board were made by the Government, salaries to the ministerial staff were paid by the Government; the appointments, transfers, suspension and removal were always by the Government--the budget provisions for the Board were made by the State Government--shows that the Board was always treated as a department of Government for all purposes other than those powers which the Act itself had specifically conferred and made the Board autonomous to that extent."
33. In the concurring judgment, Hon'ble B. Mukerji, J. in para 10 said:
"10. It was not shown to us that the Board was ever treated as a Corporation or a body incorporated or it exercised any privileges peculiar to such bodies. I could think of no law, and none was shown to us, on which it could be contended that simply because a certain body was created by statute that body could not function as a Department of Government so as to be outside the scope of the executive power of the Governor under Article 154 of the Constitution. Clause (2) (b) of this Article conferred powers on Parliament and the State Legislature under which either could confer by law functions on any authority subordinate to the Governor but because of the provisions of Clause (2) (a) the Governor could not exercise 'Executive power' where such functions had been, conferred on any other authority by any existing law."
34. Again a Hon'ble Single Judge of this Court in Sangam Lal Dube Vs. Director of Education and another, AIR 1957 All 70 considered "Board's" status. Therein an order was passed by Director of Education transferring Sri Sangam Lal Dube who was working as Clerk in Board to the office of Government Normal School, Aligarh. The power of Director was challenged on the ground that Board is not part of Education Department and, therefore, Director has no such power. The contention was upheld in para 30 of the judgment, which reads as under:
"30. Various provisions of the Code and Financial Hand Book were placed before me to show that the powers of the Director and that of the Board are mutually exclusive. District powers are given to the Secretary of the Board and to the Deputy Director of Education. It is not necessary for me to refer to all of them, but in my opinion the Board cannot be regarded as a part of the Education Department of the State so as to be under the control of the Director of Education.
Apart from it as I have already indicated the power to punish the staff of the Board has been given to the Secretary and I find that in the present case the transfer was in fact punishment awarded to the petitioner. The Director had in my opinion no power to transfer him. There is another aspect of the matter to be considered. If the Board of Education is a body created under the Act the staff of the Board is not a part Of the Education Department. The transfer to some other office in fact amounts to termination of the services of the petitioner in the office and re-employment in another office and in that view of the matter also the opportunity should have been given to the petitioner."
35. I, however, do not find any contradictory opinion expressed in the later two judgment for the reason that the Hon'ble Single Judge has simply held that Board is not a part of Education Department but did not held that it cannot be treated to be a Department of Government for any purpose whatsoever which was the decision taken by Division Bench in Ghulam Haqqani Khan (supra).
36. Section 2 sub-section (a) of Act, 1921 defines "Board" as the Board of High School and Intermediate Education and its constitution is provided in Section 3. The members of Board can be removed by the State Government as provided in Section 3-A and the term of the office of members is provided in Section 4. Section 5 contemplates that the Board shall be reconstituted before expiry of term of office of members under Section 4. The constitution of Board in Section 3 and its functions as provided in Section 7 makes it clear that Board is a statutory body, independent of Government, having several members connected with Government or its various institutions but also several members belonging to other bodies like, Kendriya Vidyalaya Sangathan, State Legislative Assembly, State Legislative Council and private recognised institutions not maintained by the State Government etc. The State Government, however, has been conferred with power to address the Board with reference to any of the work conducted or done by Board and also to communicate it the Government views on any matter with which the Board is concerned. Under sub-section (3) and (4) of Section 7 of Act, 1921 the State Government can issue directions "consistent with the Act" which the Board shall be obliged to comply. The State Government also has power to make amendment in the regulations without making any reference to Board.
37. Thus, initially when Act, 1921 was enacted, power and authority enjoyed by private managements of educational institutions left intact, i.e., remained untouched. However, subsequently, it was found that protection is needed to avoid mismanagement of institutions and, therefore, a major amendment was made in 1958 extending and enlarging statutory power of supervision by the educational authorities upon the private management. This included provisions relating to framing of scheme of administration which would include provisions relating to management and conduct all the affairs of institution concerned, Power of approval of scheme of administration, and certain matters relating to staff of the College. In fact Section 16-A to 16-G were inserted by U.P. Act No. 36 of 1958.
38. For the purpose of present case Section 16-G is relevant which has also been relied, referred to and read repeatedly by learned counsels for the parties.
39. Section 16-G deals with "conditions of service of Heads of institutions, teachers and other employees". Sub-section (1) and (2) thereof reads as under:
"16-G. Conditions of service of Heads of institutions, teachers and other employees.- (1) Every person employed in a recognized institution shall be governed by such conditions of service as may be prescribed by regulations and any agreement between the management and such employee in so for as it is inconsistent with the provisions of this Act or with the regulations shall be void.
(2) Without prejudice to the generality of the powers conferred by sub-section (1), regulations may provide for-
(a) the period of probation, the conditions of confirmation and the procedure and conditions for promotion and punishment, including suspension pending or in contemplation of inquiry or during the pendency of investigation, inquiry or trial in any criminal case for an offence involving moral turpitude and the emoluments for the period of suspension and termination of service with notice;
(b) the scales of pay and payment of salaries;
(c) transfer of service from one recognized institution to another;
(d) grant of leave and Provident Fund and other benefits; and
(e) maintenance of record of work and service."
(emphasis added)
40. The conditions of service for which Regulations framed under Section 16-G, are provided in Chapter-III of the Regulations under Act, 1921.
41. Chapter I deals with "Scheme of Administration" and contains provisions in respect to subject covered by Sections 16-A, 16-B and 16-C. Chapter-II deals with "Appointments of Heads of institutions and teachers" with reference to Section 16-E, 16-F and 16-FF". The "conditions of service" with reference to Section 16-G are contained in Chapter-III.
42. Regulation 100 apply various provisions of Chapter-III to Class-III and Class-IV staffs of Secondary Schools and Colleges. This provision was inserted by notification No. 7/562-5-8 dated 10.03.1975 and reads as under:
^^100- fyfid] ftlesa iqLrdky;k/{k Hkh lfEefyr gS] ds lEcU/k esa izcU/k lfefr rFkk prqFkZ Js.kh deZpkjh ds lEcU/k esa vkpk;[email protected] iz/kkuk/;kid fu;qfDr izkf/kdkjh gksxkA fyfidksa] ftlesa iqLrdky;k/;{k Hkh lfEefyr gSa] rFkk prqFkZ Js.kh deZpkfj;ksa dh fu;qfDr] ifjoh{kk] ftldh vof/k ,d o"kZ dh gksxh] LFkk;hdj.k ,oa lsok 'krksZa vkfn ds laca/k esa vko';d ifjorZu lfgr Åij ds fofu;e 1] 4 ls 8] 10] 11] 15] 24 ls 26] 30] 32 ls 34] 36 ls 38] 40 ls 43] 45 ls 52] 54] 66] 67] 70 ls 73 rFkk 76 ls 82 ds izko/kku ykxw gksaxs] fdUrq prqFkZ Js.kh deZpkfj;ksa ds lEcU/k esa fofu;e 77 ls 82 ds izko/kku rHkh ykxw gksaxs tc bl lEcU/k esa jkT; ljdkj }kjk vko';d funsZ'k fuxZr fd;s tk;saxsA bu deZpkfj;ksa ds lEcU/k esa fofu;e 9] 12] 13] 14] 16 ls 20] 27] 28] 54] 55 ls 65 rFkk 97 ds izko/kku ykxw ugha gksaxsA**"
43. These Regulations talk of probation, confirmation etc., i.e., the provisions relating to conditions of service and confirmation. The existing provisions, therefore, under Act, 1921 read with Regulations framed thereunder nowhere control, check or obstruct the power of management of a Secondary institution regarding recruitment and appointment of Class-III and Class-IV staff in any manner except to the extent of providing conditions relating to eligibility etc. and that too in the context of the fact that in recognised and aided educational institutions the payment of salary to the staffs is the responsibility of State Government and, therefore, the number of posts of Class-III and Class-IV staffs is also regulated by State Government, otherwise in all matters management of an educational institution (Secondary) is free and enjoy the power of recruitment and appointment of Class-III and Class-IV staff to the extent it requires for smooth working and functioning of institution.
44. The regulation of payment of salary is vide Act, 1971 which is applicable to the institutions which are recognised and receiving maintenance grant from the State Government. Section 10 of Act, 1971 makes the State Government liable for payment of salary of teachers and employees of every institution in respect of any period after 31.03.1971. It is in this context vide Section 9 a restriction has been imposed upon an institution not to create a new post of teacher or other employee except with the previous approval of Director or such other Officer as may be empowered in that behalf by Director. Here also the power of creation of post has been left with institution but in order to attract the provisions of Act, 1971 for a valid creation of post, an approval by Director or other officer as empowered by Director, is necessary. There is no power of abolition of any post in an institution conferred upon the Director or any officer. Power of appeal cannot be identified with power of creation but it is only regulatory.
45. A comprehensive reading of various provisions of Act, 1921 and in particular Section 16-G it is thus evident that power to frame Regulations has been conferred in respect to matters relating to "conditions of service" and nothing else. The term "conditions of service" is not wide enough to include every stage commencing from recruitment or appointment and thereafter. There is a distinction between the term "recruitment" and "conditions of service". It is worthwhile to mention that in Article 309 of the Constitution both these terms have been used in respect to Legislative power and in that context have been considered by Courts.
46. In service jurisprudence three terms are of wide application, have a definite concept and well known to those who deal in the subject. This is called "common parlance". These three terms are "recruitment", "appointment" and "conditions of service".
47. The meaning of term "recruitment" and its distinction vis a vis "appointment" came to be considered in Prafulla Kumar Swain Vs. Prakash Chandra Misra, 1993 Supp. (3) SCC 181 and the Court said that the term "recruitment" connotes and signifies enlistment, acceptance, selection or approval for appointment. Certainly, this is not actual appointment or posting in service. In contradiction thereto the word "appointment" means the actual act of posting a person to a particular office. Similarly, in K. Narayanan Vs. State of Karnataka, 1994 Supp. (I) SCC 44 the Court said that "recruitment" according to dictionary meaning "enlistment". It is a comprehensive term and includes any method provided for inducting a person in public service. However, in the context of the case the Court proceeded to observe that appointment, selection, promotion, deputation are well known methods of recruitment and even appointment can be made by transfer.
48. The term "conditions of service" is also no more res integra having been considered and defined by Courts time and again.
49. One of the earliest known case considering the term "conditions of service" is North West Frontier Province Vs. Suraj Narain Anand, Vol. LXXV Indian Appeals 343. Therein Privy Council considered the term "conditions of service" as mentioned in Section 243 of Government of India Act, 1935. It says that the term "conditions of service" must mean all the conditions on which a man serves and they must include inter alia the tenure of his service, the method by which he may be dismissed or reduced in rank etc.
50. In State of Madhya Pradesh Vs. Shardul Singh, 1970(1) SCC 108 the Court explain the expression "conditions of service" as under:
"The expression "conditions of service" is an expression of wide import. It means all those conditions which regulate the holding of a post by a person right from the time of his appointment till his retirement and even beyond it in matters like pension etc."
51. In I.N. Subba Reddi Vs. Andhra University, 1977(1) SCC 554 the Court explain the term as under:
"The expression 'conditions of service' means all those conditions which regulate the holding of a post by a person right from the time of his appointment till his retirement and even beyond it, in matters like pension etc."
52. Same view was taken in para 6 of the judgment in Mysore State Road Transport Corporation Vs. Mirja Khasim Ali Beg and another, 1977(2) SCC 457.
53. In Lily Kurian Vs. Sr. Lewina and others, 1979(2) SCC 124 in para 13 of the judgment, the Court referred to above decisions and observed that the expression "conditions of service" includes everything from the stage of appointment to the stage of termination of service and even beyond including the matter pertaining to disciplinary action.
54. Again it came for consideration in Syed Khalid Rizvi and others Vs. Union of India and others, 1993(3) SCC 575. The Court formulated a question, whether seniority is a condition of service or part of rules of recruitment. It observed that conditions of service may be classified as salary, confirmation, promotion, seniority, tenure or termination of service etc. The Court considered whether a right to promotion and right to be considered for promotion constitute a condition of service. Referring to a Constitution Bench decision in Mohd. Shujat Ali and others Vs. Union of India and others, 1975(3) SCC 76 the Court observed that a rule which confers a right to actual promotion or a right to be considered for promotion is a rule prescribing a condition of service. It also refers to another Constitution Bench decision in Mohd. Bhakar Vs. Krishna Reddy, 1970 SLR 768 observing that any rule which affects the promotion of a person relates to his condition of service. Then it also refers to a further earlier judgment of Apex Court in State of Mysore Vs. G.B. Purohit, C.A. No. 2281 of 1965, decided on 25.01.1967 to hold that a rule which merely effects chances of promotion cannot be regarded as varying a condition of service. Chances of promotion are not conditions of service. Same view was reiterated in a later Constitution Bench decision in Ramchandra Shankar Deodhar and others Vs. The State of Maharashtra, 1974(1) SCC 317. All these decisions were harmonized by Court in Syed Khalid Rizvi (supra) observing that if an employee was initially recruited into service according to Rules and promotion was regulated in the same Rules to higher echelons of service, in that arena, promotion may be considered to be condition of service.
55. In a Division Bench decision of this Court the above decisions have been referred to and this Court in Dr. Rajeev Ranjan Mishra and others Vs. State of U.P. and others, 2008)(1) ESC 595 has said:
"The distinction between rule of "recruitment" and "condition of service" is no more res integra having already been settled by the Apex Court in a catena of cases. In State of U.P. Vs. Shardul Singh 1970(1) SCC 108 the Apex Court held that the term "conditions of service" means all those conditions which regulate the holding of a post by a person right from the time of his appointment till retirement and even pension etc. It was reiterated in I.N. Subbareddy Vs. State of A.P. 1997(1) SCC 554. In Syed Khalid Rizvi Vs. Union of India 1993 Supp (3) SCC 575 the Apex Court held where a rule permits relaxation of provisions pertaining to "conditions of service", the same would be applicable to the condition after appointment to the service in accordance with rules. It also held that that "conditions of recruitment" and "conditions of service" are distinct and the latter is preceded by an appointment according to rules, the former cannot be relaxed."
"Part 3, 4 and 5 contain rules of recruitment which includes rules pertaining to reservation, eligibility and other qualifications with respect to nationality, educational qualifications, age, character, marital status, physical fitness etc. and procedure for recruitment. The rules pertaining to 'recruitment' cannot be relaxed by exercising power under Rule 26 since such rules are not relaxable."
56. The above decision has been followed in Devendra Nayak and another Vs. State of U.P. and others, Writ Petition No. 55988 of 2009, decided on 24.02.2011.
57. There is a Full Bench judgment of Gujarat High Court also dealing with this issue in A.J. Patel and others Vs. The State of Gujarat and others, AIR 1965 Guj 234a. The judgment was rendered by Hon'ble K.T. Desai, C.J. and in para 27, with reference to the terms "recruitment" and "conditions of service" mentioned in Article 309 of the Constitution, His Lordship said:
"From this Article it is evident that rules relating to the recruitment of persons to public services and posts are distinct from rules relating to the conditions of service. The conditions of service are conditions applicable to persons who have been appointed to public services and posts. The terms and condition relating to recruitment and relating to appointment to public services and posts must, therefore, be regarded as distinct and different from the conditions of service governing persons on their appointment to public services and posts."
58. In the context of above exposition of law, if this Court looks into Section 16-G it is evident that it talks of only "conditions of service" of such person who is employed in a recognised institution. Therefore, to attract Section 16-G authorising the competent authority to frame Regulations thereunder, the condition precedent is that the person must be employed in a recognised institution. The Regulations relating to condition of service presupposes an existing employed person. That being so, in my view, Section 16-G authorised the competent regulation framing authority to make Regulations dealing with "conditions of service" to a stage which comes after employment of a person in a recognised institution and not earlier thereto. This is how sub-section (1) of Section 16-G confers general powers of regulation framing. The above view is further fortified from the fact that various categories in respect whereto the conditions of service can be laid down by regulations all come after appointment of a person and not till the stage of appointment. Besides, Section 16-G, no other provision has been shown to this Court authorising the Board or Government to frame regulations dealing with recruitment and appointment of staffs, teaching and non-teaching, of a recognised institution. The only other provision whereby the State Government possesses certain power either to modify, rescind or make any Regulations or to issue instructions to the Board in a particular manner, is Section 9 but it is also restricted, i.e., only in the matters which are consistent with this Act, i.e., Act, 1921 and not beyond thereto. Therefore, Section 9 would also cover only those subjects which are consistent with the Act and not otherwise.
59. The impugned G.O. in the opening paragraph deals with the subject, pay scale, which is admittedly a condition of service and, therefore, there cannot be any apparent objection with regard to Legislative power or competence of the State Government in issuing the aforesaid G.O. But Para 2 thereof deals with a subject which has nothing to do with revision of pay scale as such. It hampers the power of Management or employer regarding recruitment and appointment of Class-IV employees in a recognised institution. Apparently this power is not shown to be supported by any provision of Act, 1921. To my mind it would not be included within the provision of Section 16-G also. Once it is evident that the power is not referable to Act, 1921, or any other statute, this would be ex facie ultra vires. For this reason alone this Court could have no hesitation in holding Para 6 of G.O. dated 06.01.2011, ultra vires and illegal in so far as it restrain the Management of recognised Secondary Educational Institutions from recruiting and appointing non-teaching staffs, i.e., Class-IV posts.
60. Even otherwise, Para 2 of G.O. to my mind would be contrary to certain regulations which provides the procedure and manner in which appointment shall be made by Secondary Educational Institutions on Class-III and Class-IV posts. There is no prohibition in making appointment on Class-IV posts against sanctioned posts available in recognised educational institutions. The G.O. in question cannot be said to be a regulation framed under Act, 1921. It also does not satisfy the condition precedents so as to partake the nature of an order issued by State Government under Section 9(3) and (4) of Act, 1921. The G.O. is basically a general order issued to various departments with respect to revision of pay and in that context it has been issued in reference to Secondary Educational Institutions also.
61. Moreover, in the context of what it has permitted to be done by educational institutions, there also I am of the view that this order is palpably arbitrary, discriminatory, exploitative in nature and, therefore, suffers the voice of contravening constitution provision under Article 14 and 16. It is not a case where requirement of Class-IV staffs in educational institutions has been done away. The existing sanctioned posts of Class-IV have not been abolished. It is nobody's case that henceforth educational institutions shall not require any Class-IV staffs in its functioning. What it suggests and try to endeavour is that the educational institutions shall not employ Class-IV staff directly on their own so as to function and discharge the duties of Class-IV staff under the administrative and otherwise control of institution, but, the work supposed to be performed by Class-IV staff would be required to be done through the staff made available by an outside agency and by that agency's staffs. In true sense though it is termed "outsourcing", but it does not satisfy the requirement of term "outsourcing", as discussed above.
62. The normal functions of Class-IV staff in a secondary educational institution is ringing of bell, opening of class rooms, cleaning, providing stationary etc. from office to class teachers, taking files and other documents like examination copies etc. from one place to other and similar other menial job. All this work of Class-IV has to be performed by a person present in educational institution itself. It cannot be performed sitting outside the educational institution. Therefore, what the G.O. suggests is that for performing menial job of Class-IV, the workers shall be made available by a third party, by whatever name it may be called, may be a labour supplier, may be a Service Provider or else but in effect it amounts to introduction of a "middleman" for arranging Class-IV employees to perform the job of Class-IV in educational institutions for which the institutions shall pay the service charges which would include wages/salary of such person (Class-IV) and also the service charges of third party. This is nothing but a kind of contract labour arrangement.
63. Introduction of a middlemen where the requirement is perennial, continuous and permanent has been deprecated time and again and many statutes enacted with an objective to exclude middleman have been held to be in public interest. This is really strange that herein the State Government intend to introduce a system of middleman when it is not already there. Learned Additional Advocate General also could not explain that besides wages/salary of the person who would be available to educational institution for performing the job of Class-IV employee, the service charges to third party would also be paid and in these circumstances how it can be an arrangement for saving the cost. To this query he could not reply at all.
64. In my view, therefore, though the concept of making available the staff to perform Class-IV job by outside agency though termed "Outsourcing" but it is nothing but a system of supply of work force through a contractor or a person who satisfy the term "contractor" for all purposes though termed as "outsourcing". Hence the system as contemplated in Para 2 of impugned G.O. is evidently exploitative, arbitrary, unreasonable, irrational, illogical, hence violative of Article 14 and 16 of the Constitution.
65. This Court has also considered Para 2 of G.O. dated 06.01.2011 in Luv Kush Pandey (supra) and has referred to various statutory provisions in Act, 1921 and Regulations framed thereunder. However, while reading down the G.O. so as not to cover the vacancies occurred before issuance of said order, the Court has observed as under:
"Learned counsel for the State has not been able to satisfy the object behind banning the regular process of appointment against a clear vacancy on class IV post and getting it filled up by outsourcing.
The outsourcing, not being a matter of recruitment under the Act and the Regulations, could not have been introduced by means of a Government Order. It is also to be taken note of that in the instant case the vacancy had occurred on 28.2.2010, i.e. much before the issuance of Government Order dated 6.1.2011. Prior permission was granted by the Director of Education on 21.12.2010, i.e. before issuance of the aforesaid Government Order. The appointment, however, was made after issuance of the Government Ord0.79"er dated 6.1.2011. The vacancy having occurred prior to the Government Order dated 6.1.2011, cannot be taken to be a future vacancy so as to restrain the Principal from filling up the post for both the reasons aforesaid, viz. (1) the restraint order could not have been issued for banning the appointment on a clear vacancy of class IV post through regular process of appointment and substituting it by a new method of appointment which is not envisaged under the Act and the Regulations framed thereunder and also for the reason that the aforesaid ban, if at all is to be upheld then it has to be read down for appointments on future vacancies i.e. which had occurred after the issuance of the Government Order dated 6.1.2011 and not for the vacancies which had occurred earlier."
66. In the aforesaid decision this Court though has doubted the correctness of Para 2 of G.O. but has not ultimately adjudicated thereon and left the issue open since the facts in that case show that vacancies had occurred prior to G.O. dated 06.01.2011 and, therefore, the Court by merely reading down the G.O. upheld selection made by educational institution on Class-IV posts. The observations therein, however, show that Court doubted the justification of Government's decision for banning regular appointment on Class-IV posts and getting it filled up by outsourcing but did not make a final adjudication on this aspect. This is evident from the question posed by Court, as is evident from following:
"The question, however, arises whether the State Government could have issued a blanket restraint order on making appointment on a class IV post on which (1) vacancy has occurred prior to the issuance of the banning order dated 6.1.2011, (2) the vacancy has occurred after the aforesaid Government Order dated 6.1.2011, and (3) whether such a ban can be imposed for making appointment as per the statutory provision and allowing appointment by adopting the process of outsourcing."
67. Since the wider issue of validity has not been decided therein, it cannot be said that except to the extent the G.O. in question has been read down by this Court, rest of G.O. stands affirmed by aforesaid judgment. A judgment is a binding precedence to the extent a issue is raised, argued and decided therein. It is not to be read as a statute. It cannot be read to cover something to which it has made no adjudication. I, therefore, find no obstruction in proceeding to consider the validity of Para 2 of G.O. dated 06.01.2011 in these sets of writ petitions where this issue has been specifically raised, argued and the Court has been called upon to adjudicate thereon.
68. In the result, following writ petitions are decided in the following manner:
(A) The Writ Petitions No. 11670 of 2011, 27387 of 2011, 27388 of 2011, 45111 of 2011, 33140 of 2011, 64630 of 2011, 68199 of 2011, 68591 of 2011, 68592 of 2011, 62476 of 2011, 63197 of 2011 and 1432 of 2012 are allowed to the extent that Para 2 of G.O. dated 06.01.2011 is struck down in its application to Secondary Educational Institutions recognised by the Board and governed by provisions of Act, 1921 and the Regulations framed thereunder, being illegal, arbitrary, unconstitutional and ultra vires.
(B) Writ Petitions No. 62616 of 2011, 50905 of 2011, 8492 of 2012, 49269 of 2011, 63653 of 2011, 67140 of 2011, 61539 of 2011, 62465 of 2011, 631 of 2012 and 74197 of 2011 are allowed to the extent that orders impugned passed by State Government/educational authorities, pursuant to Para 2 of G.O. dated 06.01.2011, which has already been struck down, as above, are hereby set aside. They are directed to pass fresh order in accordance with law and in the light of the observations made above.
(C) The Educational Authorities are also directed not to obstruct the process of selection and appointment on Class-IV posts in Secondary Educational Institutions only on the basis of Para 2 of G.O. dated 06.01.2011.
69. The Writ Petition No. 45708 of 2011 is disposed of directing the competent educational authorities to pass appropriate order on the matter of approval on selections made in educational institutions concerned for appointment on Class-IV posts expeditiously and in any case within a period of one month from the date of production of a certified copy of this order.
70. There shall be no order as to costs.
Order Date :-21.03.2012 AK