TaxTMI 
TaxTMI 
2021 (9) TMI 1570
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....Advs., Sunny Choudhary, AOR, Udayaditya Banerjee, AOR, Ajay Kumar Pandey, Adv., Santosh Kumar Pandey, AOR, Danish Zubair Khan, AOR, Preetika Dwivedi, AOR, Naveen Tripathi, Abhishek Kumar Singh, Uday Pratap Singh, Advs., Saroj Tripathi, AOR, Kabir Dixit, AOR, Anand Varma, AOR, Manoj K. Mishra, AOR, R.K. Singh Kaosik, Umesh Dubey, D.N. Dubey, Alok Pandey, Sudhir S. Rawat, Bheem Pratap Singh, Advs. and Divya Roy, AOR JUDGMENT M.M. Sundresh, J. 1. Heard learned Counsel for the parties. 2. We have also perused the documents filed and carefully considered the affidavits of the parties along with the written arguments filed. 3. Appeals have been preferred by the State of Uttar Pradesh laying a challenge to the judgment of the Division Bench of the Allahabad High Court dated 19.11.2018 holding that Regulation 101 framed under The Intermediate Education Act, 1921 (hereinafter referred to as "the Act") as amended is unconstitutional. Incidentally, few other appeals were disposed of by taking note of the aforesaid decision. Applications have also been filed to intervene/implead by such of those persons who are also appointed by these institutions as Class "IV" employees. Thus, ....
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....uments 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. 6. Regulations have been framed under the Act dealing with various subjects, however, for the present case only Chapter III of the said Regulations is relevant, which deals with "conditions of service". REGULATION 101: 7. Regulation 101 was inserted vide Parishad 9/592 dated 28.08.1992 and was notified by way of Govt. Notification No. 400/15-7-2(1)-90 dated 30.07.1992 in the following manner: Appointing Authority except with prior approval of Inspector shall not fill up any vacancy of non-teaching post of any recognized aided institution. 8. It was substituted through the Notification No. 300/XV-7-2(1)/90 dated 02.02.1995 as under: Appointing Authority except with prior approval of Inspector shall not fill up any vacancy of non-teaching post of any recognized aided institution: Provided that filling of the vacancy....
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....h "Outsourcing". Therefore, the permanent posts were accordingly abolished, thereby, replacing the method of appointment by way of "Outsourcing. An exception has been carved out only for the dependants of those employees died in harness during employment. AMENDED REGULATION: 101. The appointing authority, except for the prior approval of the inspector, shall not fill any vacant post of non-teaching staff (clerical cadre) in any recognised or aided institution; with the restriction that the District Inspector of Schools shall make available the total number of vacancies to the Director of Education (Secondary Education) and also put forth justification for filling of the posts, showing the strength of the students in the institution. On receipt of the order from Director of Education (Secondary Education), the District Inspector of Schools shall give permission to the appointing authority for filling the said vacancies (except the vacancies of Class-IV posts) and while giving the permission, he shall ensure compliance of the reservation Rules specified by the government as also of the prescribed norms in justification for the posts. With respect to the Class-IV ....
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....ion to withhold any fresh recruitment. However, recruitments have been made de hors the same either with or without the court orders, by the institutions. It was also done without obtaining the prior permission as per the mandate of the un-amended Regulation 101 except in one case which is the subject matter of Civil Appeal No. 2753 of 2021. In Civil Appeal No. 2754 of 2021 a direction to grant prior permission was obtained from the High Court. BEFORE THE HIGH COURT: 15. With the aforesaid backdrop, writ petitions have been filed before the Allahabad High Court. The Division Bench of the Allahabad High Court in the lead judgment dated 19.11.2018 was pleased to allow the writ petitions filed, inter alia holding that there is a violation of Article 14 of the Constitution of India. Incidentally, reliance has also been made on the provisions of Uttar Pradesh High Schools and Intermediate Colleges (Payment of Salaries of Teachers and Other Employees) Act, 1971 (hereinafter referred to as 'UP Act, 1971') which speaks about the payment of salary including the manner of disbursement. The Division Bench was of the opinion that Regulation 101 is unconstitutional being repudiate....
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.... amendment is only a consequence to the decision made by the Appellants. 20. The Order of the Division Bench would have a far-reaching financial and economic impact on the entire recruitment process throughout the State of Uttar Pradesh in view of its interpretation of "Outsourcing". Article 162 of the Constitution has got no rationale to impugned amendment. This is a case of the abolishment of the posts and as such, Section 9(4) of the Act being of wider import, the impugned Regulation is sustainable in the eyes of law. 21. To strengthen the aforesaid submissions, reliance has been placed on the following decisions: i. Federation of Railway Officers Association and Ors. v. Union of India (2003) 4 SCC 289; ii. Directorate of Film Festivals and Ors. v. Gaurav Ashwin Jain and Ors. (2007) 4 SCC 737; iii. State of Punjab and Ors. v. Ram Lubhaya Bagga and Ors. (1998) 4 SCC 737; iv. Vasavi Engineering College Parents Association v. State of Telangana and Ors. (2019) 7 SCC 172. v. Ramji Dwivedi v. State of Uttar Pradesh (1983) 3 SCC 52; vi. Union of India v. Pushpa Rani (2008) 9 SCC 242; vii. S.K. Md. Rafique v. Manageme....
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....anted to minority institutions Under Article 30(1) of the Constitution of India, in light of the judgments of this Court in the case of, (i) Ahmedabad St. Xavier's College Society and Ors. v. State of Gujarat and Ors. (1974) 1 SCC 717; (ii) St. Stephens College v. University of Delhi (1992) 1 SCC 558; (iii) T.M.A Pai Foundation v. State of Karnataka (2002) 8 SCC 481; (iv) Secy. Malankara Syrian Catholic College v. T. Jose and Ors. (2007) 1 SCC 386; and (v) Chadana Das v. State of West Bengal (2020) 13 SCC 411. 27. The Respondents who were recruited had the bona fide belief that they were employed in accordance with law, and they cannot be made to suffer, especially in light of the fact that some of them have been recruited in pursuance to prior approval given, thereby found to be qualified. Principle of undue hardship is to be applied while dealing with marginalized poor persons. Article 162 would stand infringed if the impugned amendment is allowed to be sustained. 28. As held by this Court in Catering Cleaners of Southern Railway v. Union of India and Anr. (1987) 1 SCC 700, "Outsourcing" as a method of recruitment itself is illegal and unconstitutional as it attempts to....
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....iving aid is bound by the conditions imposed and therefore expected to comply. Once we hold so, the challenge made on various grounds, falls to the ground. 34. The haze between a minority and non-minority institution is no longer in existence. This Court in SK Md. Rafique (supra) has dealt with the same through the following paragraphs: 41. In the backdrop of the decisions of this Court referred to hereinabove, we must now consider whether the relevant provisions of the Commission Act, 2008 transgress upon the rights of a minority institution or the said provisions can be termed as "tenable as ensuring the excellence of the institution without injuring the essence of the right" [Expression used by Krishna Iyer J. in Gandhi Faiz-e-am-College v. University of Agra, (1975) 2 SCC 283 : 1 SCEC 277] of a minority institution. Right from Kerala Education Bill, 1957, In re case [Kerala Education Bill, 1957, In re, 1959 SCR 995 : AIR 1958 SC 956] the issue that has engaged the attention of this Court is about the content of rights of minority educational institution and the extent and width of applicability of Regulations and what can be said to be permissible Regulations. If th....
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....le 30(1) cannot be whittled down by the so-called regulative measures conceived in the interest not of the minority educational institution, but of the public or the nation as a whole was not accepted in T.M.A. Pai Foundation [T.M.A. Pai Foundation v. State of Karnataka, (2002) 8 SCC 481 : 2 SCEC 1]. The emphasis was clear that any Regulation framed in the national interest must necessarily apply to all educational institutions, whether run by the majority or the minority and put the matter beyond any doubt. A caveat was however entered and it was stated that the government Regulations cannot destroy the minority character of the institution. 42.4. The leading judgment then observed that the correct approach would be--what was laid down by Khanna, J. in Ahmedabad St. Xavier's College case [Ahmedabad St. Xavier's College Society v. State of Gujarat, (1974) 1 SCC 717 : 1 SCEC 125]: (T.M.A. Pai Foundation case [T.M.A. Pai Foundation v. State of Karnataka, (2002) 8 SCC 481 : 2 SCEC 1], SCC p. 570, para 122) 122. ... a balance has to be kept between the two objectives -- that of ensuring the standard of excellence of the institution, and that of preserving the ....
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.... to ensure the standard of excellence of the institution and the other preserving the right of the minorities to establish and administer their educational institutions. The essence of Article 30(1) was also stated -- "to ensure equal treatment between the majority and the minority institutions" and that Rules and Regulations would apply equally to the majority institutions as well as to the minority institutions... xxx xxx xxx 59. In our considered view going by the principles laid down in the decision in T.M.A. Pai Foundation case [T.M.A. Pai Foundation v. State of Karnataka, (2002) 8 SCC 481 : 2 SCEC 1], the provisions concerned cannot, therefore, be said to be transgressing the rights of the minority institutions. The selection of the teachers and their nomination by the Commission constituted under the provisions of the Commission Act, 2008 would satisfy the national interest as well as the interest of the minority educational institutions and the said provisions are not violative of the rights of the minority educational institutions. 35. We would also like to point out two additional paragraphs of the lead judgment in T.M.A. Pai Foundation v. State of Ka....
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....ness, a constitutional court is expected to keep its hands off. 38. A challenge to a Regulation stands on a different footing than the one that can be made to an enactment. However, when the Regulation is nothing but a reiteration of a policy reinforcing the decision of the Government made earlier, then the parameters required for testing the validity of an Act are expected to be followed by the Court. 39. An executive power is residue of a legislative one, therefore the exercise of said power i.e., the amendment of the impugned Regulation, cannot be challenged on the basis of mere presumption. Once a Rule is introduced by way of a policy decision, a demonstration on the existence of manifest, excessive and extreme arbitrariness is needed. OTHER CONTENTIONS: 40. Section 9(4) of the Act is certainly of a wider import. The power conferred to the State Government to give effect to the Act is unbridled. It is the very same Regulation, based upon which, recruitments have been made by the management. One has to understand the impugned Regulation in the context along with the setting. It is only by way of abundant caution, that the amendment has come into force. The existence ....
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....private managements, the power to make appointments was suspended for the time being. As pointed out earlier, the Regulation confers power on the Committee of Management to make appointment. That Regulation was enacted by the Board with the prior sanction of the State Government. The State Government could be said to have rescinded that Regulation conferring power of appointment or at any rate suspended the power conferred on the Committee of Management to make appointment. The order became effective the moment it is issued. The effect of this order is that the Selection Committee had no right to select the Appellant nor the Committee of Management had any power to make the appointment. 14. In view of the finding that Sub-section (4) of Section 9 did confer power on the State Government to make, modify or rescind the Regulation or make any other order consistent with the provisions of the Act, the second contention of Mr. Sanghi is equally bound to fail. 41. Section 9(4) of the Act is to be read in conjunction with Section 16G, as the provisions will have to be read keeping in view all the objects of the enactment. In this connection, we need to point out that if the pr....
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....cessarily be adopting contract labour and that there exists an element of unfair trade practice, as sought to be contended by the Respondents. 46. Article 14 is positive in nature. Adequate leverage is to be provided to the law maker in making the classification. Article 14 of the Constitution of India does not prohibit discrimination, what is required is a valid discrimination against a hostile one. We do not wish to multiply the aforesaid principle of law except quoting the following paragraph in Manish Kumar v. Union of India, (2021) 5 SCC 1: 249. We see considerable merit in the stand of the Union. This is not a case where there is no intelligible differentia. The law under scrutiny is an economic measure. As laid down by this Court, in dealing with the challenge on the anvil of Article 14, the Court will not adopt a doctrinaire approach. Representatives of the people are expected to operate on democratic principles. The presumption is that they are conscious of every fact, which would go to sustain the constitutionality of the law. A law cannot operate in a vacuum. In the concrete world, when the law is put into motion in practical experiences, bottlenecks that wou....
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.... High Court has placed the onus on a wrong premise on the Appellants represented by their pleader. When a challenge is made either to a Regulation, Rule or an Act, it is for the persons who challenged, to satisfy the Court that they cannot be sustained in the eyes of law. Such a challenge has to be considered within the contours of law. Mere fact that a counsel representing the State is not able to satisfy the Court on the policy challenged would not ipso facto lead to a declaration that it is unconstitutional. Having said that, we do believe that such an exercise is also not warranted at the hands of the High Court. 52. The fact that the Act of 1921 is of a pre-independent origin has been taken note of by us already. The Regulations have been introduced in tune with the powers conferred under the Act. The concept of "always speaking" as a principle of interpretation is to be applied for a proper understanding of an old enactment. After all, such a statute having its intended object which certainly includes regulating the functions of aided institutions requires to be interpreted to deal with the past, present and future situations. Therefore, an interpretation which is reasonab....