2019 (10) TMI 1614 - SC - Indian Laws

Displaced arrack workers have no vested right to rehabilitation employment after Kerala's 1996 ban

SC held that displaced abkari workers who lost employment due to Kerala's 1996 arrack ban had no vested right to rehabilitation employment. Government's ... Rehabilitation of Abkari workers - Displaced workers who lost employment due to the ban of arrack in the State of Kerala - vested right of rehabilitation pursuant to the Government Order or not - modification/ alteration of the Government Order is vitiated due to unfairness, arbitrariness and unreasonableness or not - scope of the legitimate expectation of the Respondents - entitlement to relief after the passage of 23 years since they lost their jobs due to ban on arrack. Vested Right of Employment - HELD THAT:- There is no dispute that a number of abkari workers lost their livelihood due to the ban on arrack in the State, in the year 1996. Dissatisfied with the monetary compensation provided to them, they demanded employment in the Corporation. The agitation turned violent and to find an immediate solution to the law and order problem, the Government took a decision to provide employment to displaced abkari workers, adjusting them against 25% of the daily wage vacancies that would arise in the Corporation. There was no assurance given to all the displaced abkari workers that they would be re-employed - There was no unequivocal promise that all the displaced workers would be provided re-employment. The assurance given to the abkari workers that they would be considered for employment in 25% of the daily wage vacancies that would arise in the Corporation, according to the Government, had to be altered due to administrative exigencies - In view of the difficulties faced by the Government in implementation of the Government Order dated 20.02.2002, the Government found it fit to modify the policy decision by a Government Order dated 07.08.2004. It came to the notice of the Government that several displaced abkari workers perished after 1996. Their families had to be provided immediate succor. To give priority to the families in immediate need, the Government decided that dependent sons of the deceased abkari workers who died after the year 1996 would be provided employment against the 25% daily wage vacancies in the Corporation. The said decision cannot be termed as unreasonable or arbitrary as it was taken in light of overriding public interest. Relevant considerations were taken into account by the Government to alter the Government Order dated 20.02.2002. Legitimate Expectation - HELD THAT:- The principle of legitimate expectation has been recognized by this Court in Union of India v. Hindustan Development Corporation & Ors. [1993 (4) TMI 306 - SUPREME COURT] If the promise made by an authority is clear, unequivocal and unambiguous, a person can claim that the authority in all fairness should not act contrary to the promise. It has been held by R. V. Raveendran, J. in Ram Pravesh Singh v. State of Bihar [2006 (9) TMI 557 - SUPREME COURT] that legitimate expectation is not a legal right. Not being a right, it is not enforceable as such. It may entitle an expectant: (a) to an opportunity to show cause before the expectation is dashed; or (b) to an explanation as to the cause of denial. In appropriate cases, the Courts may grant a direction requiring the authority to follow the promised procedure or established practice. Substantive Legitimate Expectation - HELD THAT:- The assurance given to the Respondents that they would be considered for appointment in the future vacancies of daily wage workers, according to the Respondents, gives rise to a claim of legitimate expectation. The Respondents contend that there is no valid reason for the Government to resile from the promise made to them - Due deference has to be given to the discretion exercised by the State Government. As the decision of the Government to the change policy was to balance the interests of the displaced Abkari workers and a large number of unemployed youth in the State of Kerala, the decision taken on 07.08.2004 cannot be said to be contrary to public interest - the expectation of the Respondents for consideration against the 25 per cent of the future vacancies in daily wage workers in the Corporation is not legitimate. Procedural Legitimate Expectation - HELD THAT:- The principle of procedural legitimate expectation would apply to cases where a promise is made and is withdrawn without affording an opportunity to the person affected. The imminent requirement of fairness in administrative action is to give an opportunity to the person who is deprived of a past benefit - there is an exception to the said rule. If an announcement is made by the Government of a policy conferring benefit on a large number of people, but subsequently, due to overriding public interest, the benefits that were announced earlier are withdrawn, it is not expedient to provide individual opportunities to such innominate number of persons. In other words, in such cases, an opportunity to each individual to explain the circumstances of his case need not be given. In Union of India v. Hindustan Development Corporation and Ors., it was held that in cases involving an interest based on legitimate expectation, the Court will not interfere on grounds of procedural fairness and natural justice, if the deciding authority has been allotted a full range of choice and the decision is taken fairly and objectively. Judicial Review and Proportionality - HELD THAT:- Proportionality involves ‘balancing test’ and ‘necessity test’ [Coimbatore District Central Co-operative Bank v. Coimbatore District Central Cooperative Bank Employees Association & Anr. (2007) 4 SCC 669]. Whereas the balancing test permits scrutiny of excessive and onerous penalties or infringement of rights or interests and a manifest imbalance of relevant considerations, the necessity test requires infringement of human rights to be through the least restrictive alternatives. In the instant case, the Respondents challenged the order dated 07.08.2004, as being violative of Articles 14, 19 and 21. The High Court accepted the submissions made by the Respondents and held that the Order dated 07.08.2004 is vitiated as it suffers from the vice of arbitrariness and unreasonableness. However, in view of the challenge to the decision of the Government being on the ground of violation of Articles 14, 19 and 21, the test of proportionality should be applied to review the impugned decision of the Government. The promise held out by the Government to provide employment to the displaced Abkari workers had become an impossible task in view of the non-availability of vacancies in the Corporation. The decision taken by the Government in overriding public interest was a measure to strike a balance between the competing interest of the displaced Abkari workers and unemployed youth in the State of Kerala. The impairment of the fundamental rights of the Respondents due to the change in policy cannot be said to be excessive. Hence, it cannot be said that the change in policy regarding re-employment of displaced abkari workers is disproportionate. Conclusion - i) The findings recorded by the High Court that a right of appointment accrued to the Respondents and it matured into a Right to Life as provided in Article 21 of the Constitution not agreed upon. ii) The opinion of the High Court that the Order dated 07.08.2004 is in continuation of the Order dated 20.02.2002 in view of the Order dated 20.02.2002 not being superceded, disapproved. Appeal allowed. The core legal questions considered by the Court in this matter are:(a) Whether the displaced abkari workers acquired a vested right to rehabilitation and employment pursuant to the Government Order dated 20.02.2002;(b) Whether the subsequent modification or alteration of the Government Order dated 20.02.2002 by the Government Order dated 07.08.2004 was vitiated by unfairness, arbitrariness, or unreasonableness;(c) The scope and applicability of the doctrine of legitimate expectation in the context of the assurances given to the displaced abkari workers;(d) Whether the displaced abkari workers remain entitled to any relief after the lapse of over two decades since the ban on arrack and consequent loss of employment.Issue-wise Detailed AnalysisA. Vested Right of EmploymentThe legal framework involves principles of administrative law regarding the creation of vested rights by government orders and the extent to which such orders create enforceable rights. The Court examined the nature of the Government Order dated 20.02.2002, which reserved 25% of all daily wage employment vacancies in the Kerala State Beverages Corporation for displaced abkari workers.The Court reasoned that this order did not amount to an unequivocal promise of employment to all displaced workers but was rather a policy decision to reserve a portion of future vacancies. The number of vacancies was limited, and the order did not guarantee re-employment to each displaced worker. Therefore, no vested right in the strict legal sense accrued to the workers. The Court rejected the argument that the order created an indefeasible right to employment.The Government's modification of the order in 2004, restricting employment to dependent sons of deceased workers, was justified on administrative grounds, including the practical difficulty of accommodating a large number of displaced workers against limited vacancies. The Court held that this modification was not arbitrary or unreasonable but was taken in overriding public interest, balancing competing social considerations.B. Legitimate ExpectationThe Court analyzed the doctrine of legitimate expectation, as expounded in prior precedents, including the principles laid down in Union of India v. Hindustan Development Corporation and Punjab Communications Ltd. v. Union of India. Legitimate expectation may be substantive (expectation of a benefit) or procedural (expectation of a hearing before withdrawal of a benefit).Substantive legitimate expectation requires a clear, unequivocal, and unambiguous promise or established practice. The Court found that the Government Order dated 20.02.2002 did not create such a substantive legitimate expectation because it was a policy decision subject to change, especially given the administrative difficulties encountered.Procedural legitimate expectation entails the right to be heard before a benefit or assurance is withdrawn. While the displaced workers were not individually given an opportunity before the 2004 modification, the Court noted that the Government had consulted worker representatives. Moreover, where a policy affects a large class of persons and is altered due to overriding public interest, it is not always feasible or required to provide individual hearings. The Court thus held that the procedural legitimate expectation was not violated in this case.C. Judicial Review and ProportionalityThe Court applied principles of judicial review, particularly the Wednesbury unreasonableness test and the doctrine of proportionality, as elaborated in Om Kumar v. Union of India and other precedents. Proportionality requires that any restriction on fundamental rights be justified by an important objective, have a rational connection to that objective, and be no more restrictive than necessary.The displaced workers challenged the 2004 Government Order as arbitrary and violative of Articles 14 (equality), 19 (freedom), and 21 (right to life and livelihood) of the Constitution. The Court held that the Government's decision to modify the policy was rationally connected to the objective of balancing interests between displaced workers and the wider unemployed youth population. The means adopted were not excessive or disproportionate given the scarcity of vacancies and the passage of time since the ban.The Court rejected the High Court's finding that the 2004 order was arbitrary and violative of fundamental rights. It further clarified that the 2004 order replaced the 2002 order rather than merely modifying it without supersession, thereby nullifying the argument that the original order continued to confer rights.D. Entitlement to Relief After Passage of TimeThe Court considered whether the displaced workers could claim relief after more than 20 years since losing employment. It was observed that the workers had been compensated monetarily soon after the ban and that the Government had made efforts to provide employment to dependent sons of deceased workers. The passage of time and changed circumstances diminished any entitlement to rehabilitation or employment under the original policy.The Court noted that the Government had complied with the High Court's direction to appoint 265 dependent sons of deceased workers pursuant to the 2004 order and that the validity of that order had not been conclusively determined in prior litigation.Competing Arguments and Their TreatmentThe displaced workers argued for enforcement of the original 2002 order based on legitimate expectation and fundamental rights. They contended that the 2004 modification was arbitrary and that the Government failed to provide them a hearing before altering the policy. Some even argued that restricting employment to dependent sons of deceased workers was cruel and invited tragic consequences.The Government and Corporation countered that no vested right existed, that the policy was modified due to overriding public interest and administrative exigencies, and that the workers had been adequately compensated. They emphasized the scarcity of vacancies and the need to balance interests with other unemployed youth. The Corporation also pointed out that appointments were made through the Public Service Commission, and preferential employment to displaced workers would unfairly prejudice other candidates.The Court accepted the Government's arguments, emphasizing the discretionary power of the State in policy matters and the need to consider public interest and administrative feasibility. It rejected the notion of an indefeasible right to employment and held that the change in policy was neither arbitrary nor disproportionate.Significant Holdings'It cannot be said that a vested right accrued to all the abkari workers to claim employment in retail outlets in the Corporation.''The assurance given to the abkari workers that they would be considered for employment in 25% of the daily wage vacancies that would arise in the Corporation... had to be altered due to administrative exigencies.''The principle of legitimate expectation has been recognized... If the promise made by an authority is clear, unequivocal and unambiguous, a person can claim that the authority in all fairness should not act contrary to the promise.''The expectation of the Respondents for consideration against the 25 per cent of the future vacancies in daily wage workers in the Corporation is not legitimate.''In such cases [where a policy affects a large number of persons and is altered due to overriding public interest], an opportunity to each individual to explain the circumstances of his case need not be given.''The impairment of the fundamental rights of the Respondents due to the change in policy cannot be said to be excessive. Hence, it cannot be said that the change in policy regarding re-employment of displaced abkari workers is disproportionate.''The Order dated 07.08.2004 replaces the Order dated 20.02.2002 in view of a fresh decision taken to provide employment only to the dependent sons of deceased Abkari workers.''The Appeals are allowed.'