Supreme Court settles the status of ad-hoc employees in Sports Authority of India: Sports Authority of India & Anr. vs. Dr. Kulbir Singh Rana (2025) INSC 319 (04 March 2025)

Introduction

Date of the Judgment: 04 March 2025
Citation: (2025) INSC 319
Judges: Sudhanshu Dhulia, J., Ahsanuddin Amanullah, J.

What happens to employees who are hired on an ad-hoc basis when new rules come into effect? The Supreme Court of India addressed this important question in a recent case involving the Sports Authority of India (SAI). The court examined whether employees initially hired on a temporary basis could be considered permanent employees under new regulations. This judgment clarifies the rights of ad-hoc employees and the obligations of SAI. The judgment was delivered by a bench comprising Justice Sudhanshu Dhulia and Justice Ahsanuddin Amanullah.

Case Background

The Sports Authority of India (SAI) was established in 1984 to promote sports in India. Dr. Kulbir Singh Rana and other individuals were working on a contractual basis as physiotherapists. In 2022, SAI introduced new recruitment rules, leading to a restructuring that affected the employment status of these contractual employees. Instead of renewing their contracts, SAI advertised their positions, inviting all interested candidates, including the existing ad-hoc employees, to apply. Dr. Rana and others participated in the selection process but were later declared ineligible. This led them to challenge the recruitment process before the Central Administrative Tribunal, arguing that they should be considered part of the “initial constitution” of SAI under the new rules.

Timeline:

Course of Proceedings

The respondents challenged the recruitment process before the Central Administrative Tribunal, Principal Bench at New Delhi. The Tribunal allowed their application on 04.11.2023, directing SAI to consider the applicants as “Initial Constituent” as per Rule 4 of the 2022 Rules. The Tribunal also quashed the termination orders dated 09.02.2023 and 10.02.2023.

SAI then challenged this order before the Delhi High Court. The counsel for SAI stated that they would not press the Writ Petition on merits if they were given more time to comply with the Tribunal’s directions. The High Court disposed of the Writ Petition on 28.02.2024, extending the time for SAI to consider the case of the respondents as “initial constituents.”

Subsequently, SAI filed two recall applications against the High Court order, which were dismissed. The High Court noted that SAI did not deny that their counsel’s statement seeking time to comply with the Tribunal’s order was made without instructions from SAI. The High Court rejected the plea that the counsel had misunderstood the Tribunal’s order.

Legal Framework

The Sports Authority of India (SAI) was created in 1984 and registered under the Societies Registration Act, 1860. The objective was to promote sports and games in India. The relevant rules and regulations include:

• Sports Authority of India (Sports Sciences and Sports Medicine) Staff Recruitment Rules, 1992 (‘1992 Rules’)
• Sports Authority of India (Service) Bye Laws and Conditions of Service Regulations 1992
• Sports Authority of India Executive Cadre (Grade A) Staff Recruitment Rules 2022 (‘2022 Rules’)

The “initial constitution” clause in both the 1992 Rules and the 2022 Rules is central to the dispute. Rule 4 of the 1992 Rules states:

‘4) INITIAL CONSTITUTION:
(a) All the employees in SAI working on ad­hoc basis on any of the post mentioned in the schedule on the date these rules come into force shall, after the approval by a duly constituted Committee, shall be deemed to have been appointed under these rules with effect from a date as may be decided by the said Screening Committee in each individual case.
(b) All the employees working on a regular basis on any of the post contained in the schedule to these rules will be deemed to have been appointed under these rules with effect from the date of initial appointment to the post.’

Rule 4 of the 2022 Rules contains a similar provision:

‘4. Initial Constitution: ­ All the employees in SAI working on any of the post mentioned In the Annexure­I on the date these rules come into force shall be deemed to have been appointed under these rules.’

Arguments

The arguments in this case revolve around whether the respondents, who were initially appointed on a contractual basis, should be considered part of the “initial constitution” of SAI under the 2022 Rules.

Arguments by Sports Authority of India (Appellant):

• SAI contended that the respondents were merely contractual employees and not entitled to be considered part of the “initial constitution.”
• SAI argued that the counsel appearing for SAI before the High Court had misunderstood the order of the Tribunal when making the statement about complying with the Tribunal’s directions.

Arguments by Dr. Kulbir Singh Rana (Respondent):

• The respondents argued that they were selected through a due process and their appointments were not illegal but merely irregular.
• They contended that they possessed the prescribed qualifications and should be considered part of the “initial constitution” as laid down in the 2022 Rules.
• The respondents relied on the statement made by SAI’s counsel before the High Court, where the counsel sought time to comply with the Tribunal’s directions.

Issues Framed by the Supreme Court

1. Whether the respondents, initially appointed on a contractual basis, should be considered part of the “initial constitution” of SAI under the 2022 Rules.

Treatment of the Issue by the Court: “The following table demonstrates as to how the Court decided the issues”

Authorities

The Supreme Court considered the following authorities and legal provisions:

• S.S. Moghe and Others v Union of India and others: Relied upon by the Tribunal to hold that the government has the competence to decide the sources from which personnel are to be drawn when a new service is constituted.
• Sports Authority of India (Sports Sciences and Sports Medicine) Staff Recruitment Rules, 1992: Considered the “initial constitution” provision in the rules.
• Sports Authority of India Executive Cadre (Grade A) Staff Recruitment Rules 2022: Considered the “initial constitution” provision in the rules.

Judgment

How each authority was viewed by the Court:

• S.S. Moghe and Others v Union of India and others: The Court agreed with the Tribunal’s reliance on this case to support the government’s competence in deciding the sources of personnel for a new service.
• Sports Authority of India (Sports Sciences and Sports Medicine) Staff Recruitment Rules, 1992 and Sports Authority of India Executive Cadre (Grade A) Staff Recruitment Rules 2022: The Court considered the “initial constitution” provisions in these rules to determine the status of the respondents.

The Supreme Court dismissed the appeals, upholding the decision of the Tribunal and the High Court.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the fact that the respondents were selected through a due process, their appointments were irregular but not illegal, and SAI had already made a concession regarding their status before the High Court. The Court emphasized the importance of considering the respondents as part of the “initial constitution” of SAI, given their qualifications and the circumstances of their appointment.

Key Takeaways

• Ad-hoc employees who are selected through a due process and possess the required qualifications may be considered part of the “initial constitution” of an organization under new rules.
• Statements made by counsel before a court are binding on the party unless it is a case of fraud or deception.
• Organizations must act fairly and reasonably when implementing new recruitment rules that affect the employment status of existing employees.

Development of Law

The ratio decidendi of the case is that ad-hoc employees who have been duly selected and possess the necessary qualifications can be considered part of the “initial constitution” of an organization, entitling them to the benefits and protections afforded to regular employees.

Conclusion

The Supreme Court dismissed the appeals filed by the Sports Authority of India, affirming the rights of ad-hoc employees to be considered part of the “initial constitution” of the organization. The Court emphasized the importance of fair treatment and due process in implementing new recruitment rules.