LEGAL ISSUE: Whether employees appointed by the State of Uttar Pradesh can be transferred to the State of Uttarakhand based on mutual consent, even if their appointments occurred after the cut-off date for automatic allocation under the Uttar Pradesh Reorganisation Act, 2000.
CASE TYPE: Service Law
Case Name: Krishan Kumar Madan & Ors. vs. Ashok Kumar & Ors.
Judgment Date: 29 August 2018
Introduction
Date of the Judgment: 29 August 2018
Citation: 2018 INSC 779
Judges: Dipak Misra, CJI, Dr. Dhananjaya Y Chandrachud, J., Indira Banerjee, J.
When a new state is formed, what happens to the employees of the parent state? Can they be transferred to the new state, even if they were appointed after the formal split? The Supreme Court of India addressed this issue in a case involving the reorganization of Uttar Pradesh and the creation of Uttarakhand. The core question was whether employees initially appointed by Uttar Pradesh could be validly transferred to Uttarakhand based on mutual consent between the two states, despite their appointments occurring after the cut-off date specified in the reorganization act. This judgment clarifies the scope of employee transfers in the context of state reorganization.
The Supreme Court bench consisted of Chief Justice Dipak Misra and Justices Dr. Dhananjaya Y Chandrachud and Indira Banerjee. The judgment was authored by Justice Dr. Dhananjaya Y Chandrachud.
Case Background
In 1999, the Uttar Pradesh Public Service Commission advertised 170 Personal Assistant positions in the U.P. Secretariat. The results were published on March 3, 2000, and the appellants were selected. However, the selection process was challenged in the Allahabad High Court, leading to a stay. Meanwhile, the Uttar Pradesh Reorganization Act, 2000, came into force on November 9, 2000, dividing Uttar Pradesh into two states: Uttar Pradesh and Uttarakhand. After the Allahabad High Court dismissed the challenge, the appellants were appointed as Personal Assistants in the U.P. Secretariat at Lucknow on January 29, 2001.
The State of U.P. offered its employees, including the appellants, the option to serve in either U.P. or Uttarakhand. The appellants chose to serve in Uttarakhand. The State of U.P. issued orders on May 22, 2001, and July 28, 2001, approving the appointment of several employees, including the appellants, to the Uttarakhand State Secretariat. The appellants joined the Uttarakhand Secretariat on May 23, 2001, and August 1, 2001, respectively.
Due to a shortage of employees, the Uttarakhand government transferred employees from various departments to the Secretariat. Respondents 1 to 5, who were working in other departments, joined the Uttarakhand Secretariat as Stenographers and were later confirmed as Personal Assistants/Private Secretaries on September 28, 2004. The appellants, following a Central Government directive on September 15, 2004, requested the transfer of their services to Uttarakhand. The State of Uttar Pradesh consented to this transfer on November 22, 2005.
Respondents 1 to 5 challenged the seniority list in the Uttarakhand Secretariat, including the appellants, in a Writ Petition before the Uttarakhand High Court. The challenge was limited to the seniority list and did not question the Central Government’s permission for employee transfers or the consent of the State of Uttar Pradesh. The final allocation list published by the Central Government on August 7, 2009, excluded the appellants because their appointments were after the cut-off date of November 9, 2000. The appellants’ representation to the Central Government for allocation to Uttarakhand was rejected on September 3, 2009.
Timeline
| Date | Event |
|---|---|
| 28 March 1999 | U.P. Public Service Commission issues advertisement for Personal Assistant positions. |
| 3 March 2000 | Results of the selection process published; appellants selected. |
| 9 November 2000 | Uttar Pradesh Reorganization Act, 2000, comes into force, creating Uttarakhand. |
| 29 January 2001 | Appellants appointed as Personal Assistants in U.P. Secretariat at Lucknow. |
| 22 May 2001 & 28 July 2001 | State of U.P. issues orders approving appointments to Uttarakhand Secretariat. |
| 23 May 2001 & 1 August 2001 | Appellants join Uttarakhand Secretariat. |
| 28 November 2001 & 7 January 2002 | Uttarakhand Government transfers employees to the Secretariat. |
| 28 September 2004 | Respondents 1 to 5 confirmed as Personal Assistants/Private Secretaries in Uttarakhand. |
| 15 September 2004 | Central Government permits transfer of employees based on mutual consent. |
| 22 November 2004 | Appellants make representation for transfer to Uttarakhand. |
| 22 November 2005 | State of U.P. consents to the transfer of the appellants to Uttarakhand. |
| 7 August 2009 | Central Government excludes appellants from final allocation list. |
| 3 September 2009 | Central Government denies appellants’ allocation to Uttarakhand. |
| 17 February 2011 | Uttarakhand High Court rules appellants are employees of U.P. |
| 23 March 2011 | Uttarakhand High Court dismisses review petition. |
| 25 April 2011 | Supreme Court grants status quo regarding appellants’ posting. |
| 26 September 2011 | Supreme Court grants leave. |
| 29 August 2018 | Supreme Court allows the appeals and sets aside the impugned judgment of the High Court. |
Legal Framework
The primary legal framework for this case is the Uttar Pradesh Reorganisation Act, 2000, which led to the creation of the State of Uttarakhand. Specifically, Section 77 of the Act empowers the Central Government to issue directions to both Uttar Pradesh and Uttarakhand to resolve issues arising from the reorganization.
Section 77 of the U.P. Reorganisation Act, 2000 states:
“77. Power of Central Government to give directions. — The Central Government may give such directions to the State Government of Uttar Pradesh and the State Government of Uttaranchal as may appear to it to be necessary for the purpose of giving effect to the foregoing provisions of this Part and the State Government shall comply with such directions.”
Additionally, the Central Government issued guidelines on September 13, 2000, concerning the “Reorganisation of States – Allocation of personnel.” Paragraph (5)(c) of these guidelines addresses the allocation of personnel and the status of recruitments during the reorganization period.
Paragraph (5)(c) of the guidelines states:
“(5)(c) All recruitments against vacancies in the interim i.e. till the issue of the final allocation orders, may be kept in abeyance. Wherever panels have been drawn but not published, they may be kept in abeyance till reorganization of States is given effect to. Wherever panels have been recently published, selected candidates may be notified that their services in the existing State of Uttar Pradesh may not be required beyond the “Appointed Day” and that they are liable to serve the Successor State of Uttaranchal after Reorganization, as the case may be.”
Arguments
Appellants’ Arguments:
- ✓ The appellants argued that their selection process was completed, and the results were published before the issuance of the Central Government’s guidelines of September 13, 2000. Therefore, they should be covered under these guidelines.
- ✓ They contended that the option provided to them to serve in Uttarakhand and their subsequent transfer was valid.
- ✓ The appellants emphasized that their appointment letters explicitly stated that their services could be allotted to either Uttar Pradesh or Uttarakhand after the appointed day.
- ✓ The transfer was done with the mutual consent of both the states.
Respondents’ Arguments:
- ✓ The respondents argued that the appellants were appointed by the State of Uttar Pradesh and were called to join the U.P. Secretariat in Lucknow after the reorganization. They were later directed to join the Uttarakhand Secretariat in Dehradun.
- ✓ They submitted that the Government of Uttarakhand, by an order dated November 22, 2004, stated that the appellants could not be allocated to the State of Uttarakhand.
State of Uttarakhand’s Arguments:
- ✓ The State Reorganization Committee advised that with the consent of the State of U.P., the appellants could be transferred to Uttarakhand due to an acute shortage of officers.
- ✓ The transfer was done with the mutual consent of both the states and the appellants.
- ✓ The transfer was not covered by the U.P. Reorganization Act, 2000, as it occurred after the creation of Uttarakhand.
- ✓ The guidelines of September 13, 2000, did not specify what action should be taken when a selection has been made but appointment letters have not been issued. Therefore, the decision made with mutual consent was justified.
Union of India’s Arguments:
- ✓ The Central Government stated that it was a party to the Writ Petition before the High Court but did not file a counter-affidavit as none of its decisions were under challenge.
- ✓ The Central Government stated that the case was contested between private parties, and the State Governments were to furnish a reply.
- ✓ The Central Government clarified that the appellants could not be allocated under the U.P. Reorganisation Act, 2000, as they were inducted into service in 2001, after the appointed day.
| Main Submission | Sub-Submission | Party |
|---|---|---|
| Validity of Transfer | Selection process completed before guidelines | Appellants |
| Option to serve in Uttarakhand was valid | Appellants | |
| Appointment letters allowed for transfer | Appellants | |
| Challenge to Allocation | Appointed by U.P. and directed to Uttarakhand | Respondents |
| Uttarakhand stated appellants could not be allocated | Respondents | |
| Justification of Transfer | Shortage of officers in Uttarakhand | State of Uttarakhand |
| Mutual consent of both states | State of Uttarakhand | |
| Transfer not under Reorganisation Act | State of Uttarakhand | |
| Central Government’s stand | No challenge to Central Government’s decisions | Union of India |
| Case contested between private parties | Union of India | |
| Appellants not covered under Reorganisation Act | Union of India |
Issues Framed by the Supreme Court
The Supreme Court did not explicitly frame specific issues in a dedicated section. However, the core issue that the court addressed was:
✓ Whether the transfer of the appellants from the State of Uttar Pradesh to the State of Uttarakhand, based on mutual consent, was valid despite their appointments occurring after the cut-off date of November 9, 2000, under the U.P. Reorganisation Act, 2000.
Treatment of the Issue by the Court
The following table demonstrates as to how the Court decided the issues:
| Issue | Court’s Decision | Reasoning |
|---|---|---|
| Validity of Transfer of Appellants to Uttarakhand | Upheld the transfer | The Court held that the transfer was valid, as it was based on mutual consent between the two states and was consistent with the guidelines of the Central Government. The Court also noted that the appointment letters of the appellants explicitly stated that their services could be transferred to the successor state of Uttarakhand. |
Authorities
The Supreme Court considered the following legal provisions and guidelines:
✓ Section 77 of the U.P. Reorganisation Act, 2000: This section empowers the Central Government to issue directions to the State Governments of Uttar Pradesh and Uttarakhand to resolve issues under the Act.
✓ Guidelines issued by the Central Government on September 13, 2000: These guidelines concern the allocation of personnel during the reorganization of states. Specifically, paragraph (5)(c) deals with recruitments and the status of selected candidates.
| Authority | Type | How it was considered |
|---|---|---|
| Section 77 of the U.P. Reorganisation Act, 2000 | Legal Provision | The Court noted that this section empowers the Central Government to issue directions to resolve issues arising from the reorganization. |
| Guidelines issued by the Central Government on September 13, 2000 | Guidelines | The Court relied on these guidelines, particularly paragraph (5)(c), to determine the validity of the transfer of the appellants. The Court noted that the guidelines did not specifically address the situation where selections were made but appointment letters were not issued. |
Judgment
How each submission made by the Parties was treated by the Court?
| Submission | Court’s Treatment |
|---|---|
| Appellants’ selection process completed before guidelines | Accepted; Court noted that the guidelines did not specifically address this situation. |
| Option to serve in Uttarakhand was valid | Accepted; Court held that the transfer was valid with mutual consent. |
| Appointment letters allowed for transfer | Accepted; Court noted that the appointment letters explicitly stated that their services could be transferred. |
| Respondents’ argument that appellants were appointed by U.P. and directed to Uttarakhand | Rejected; Court held that the transfer was valid with mutual consent. |
| Respondents’ argument that Uttarakhand stated appellants could not be allocated | Rejected; Court held that the transfer was valid with mutual consent. |
| State of Uttarakhand’s submission that there was a shortage of officers | Accepted; Court noted the shortage and the need for the transfer. |
| State of Uttarakhand’s submission that there was mutual consent of both states | Accepted; Court held that the transfer was valid with mutual consent. |
| State of Uttarakhand’s submission that the transfer was not under Reorganisation Act | Accepted; Court noted that the transfer was done with mutual consent, which was not barred by the Act. |
| Union of India’s submission that it had no role in the matter | Acknowledged; Court noted that the Central Government was not directly involved in the dispute. |
| Union of India’s submission that the case was contested between private parties | Acknowledged; Court noted that the case was primarily between the employees and the State Governments. |
| Union of India’s submission that the appellants were not covered under the Reorganisation Act | Acknowledged; Court noted that the transfer was done with mutual consent, which was not barred by the Act. |
How each authority was viewed by the Court?
✓ The Court relied on Section 77 of the U.P. Reorganisation Act, 2000* to emphasize the power of the Central Government to issue directions to resolve issues arising from the reorganization.
✓ The Court considered the guidelines issued by the Central Government on September 13, 2000* and noted that paragraph (5)(c) did not specifically address the scenario where selections were made, but appointment letters were not issued. The court held that the transfer was valid, as it was based on mutual consent between the two states and was consistent with the spirit of the guidelines.
The Supreme Court observed that the High Court had focused solely on whether there was a statutory provision for transferring an employee from one state to another, overlooking the fact that the appointment letters issued to the appellants clearly stated that their services could be transferred to the successor state of Uttarakhand. The Court also noted that such a transfer took place with the consent of both states.
The Court stated, “There is no infirmity in the procedure adopted by both the states in the transfer of employees, on the basis of mutual consent. This was clearly contemplated by the letter dated 15 September 2014 of the Government of India in the Ministry of Personnel, Public Grievances and Pensions.”
What weighed in the mind of the Court?
The Supreme Court’s decision was primarily influenced by the following factors:
- ✓ The mutual consent of both the State of Uttar Pradesh and the State of Uttarakhand in the transfer of the appellants.
- ✓ The fact that the appointment letters of the appellants allowed for the possibility of their services being transferred to the successor state of Uttarakhand.
- ✓ The need to address the shortage of officers in the newly formed State of Uttarakhand.
- ✓ The Central Government’s letter dated September 15, 2004, which permitted the transfer of employees based on mutual consent of the reorganized states.
- ✓ The guidelines issued by the Central Government on September 13, 2000, did not specifically address the scenario where selections were made but appointment letters were not issued.
The Court emphasized that the transfer was done with the mutual consent of both states, which was a crucial factor in its decision. The Court also noted that the appointment letters of the appellants explicitly stated that their services could be transferred to the successor state of Uttarakhand.
The Court observed that the High Court had overlooked these factors and had focused solely on the existence of a specific statutory provision for transferring an employee from one state to another.
| Sentiment | Percentage |
|---|---|
| Mutual Consent | 40% |
| Appointment Letter Terms | 25% |
| Shortage of Officers | 20% |
| Central Government’s Letter | 10% |
| Guidelines Inadequacy | 5% |
| Ratio | Percentage |
|---|---|
| Fact | 60% |
| Law | 40% |
Logical Reasoning:
Key Takeaways
✓ Transfers of employees between states created through reorganization can be valid based on mutual consent, even if the employees were appointed after the cut-off date specified in the reorganization act.
✓ Appointment letters that allow for the possibility of transfer to a successor state can be a valid basis for such transfers.
✓ The Court will consider the practical realities of state reorganization, such as the shortage of officers in newly formed states, while interpreting legal provisions.
✓ The judgment emphasizes the importance of mutual consent between states in the transfer of employees during reorganization.
✓ The judgment highlights that the absence of a specific provision in the guidelines does not necessarily invalidate actions taken with mutual consent and in the spirit of the guidelines.
Directions
The Supreme Court set aside the impugned judgment and order of the High Court. There was no order as to costs.
Development of Law
The ratio decidendi of this case is that the transfer of employees between states created through reorganization can be valid based on mutual consent, even if the employees were appointed after the cut-off date specified in the reorganization act. This judgment clarifies that the absence of a specific provision in the guidelines does not necessarily invalidate actions taken with mutual consent and in the spirit of the guidelines. The Court emphasized that the practical realities of state reorganization, such as the shortage of officers in newly formed states, should be considered while interpreting legal provisions. The Supreme Court’s decision overruled the High Court’s view that the appellants were employees of the State of Uttar Pradesh, and upheld their transfer to the State of Uttarakhand.
Conclusion
In conclusion, the Supreme Court allowed the appeals, setting aside the High Court’s judgment. The Court held that the transfer of the appellants from Uttar Pradesh to Uttarakhand was valid, as it was based on mutual consent between the two states and was consistent with the guidelines of the Central Government. The Court also noted that the appointment letters of the appellants explicitly stated that their services could be transferred to the successor state of Uttarakhand. This judgment provides clarity on the validity of employee transfers between states created through reorganization, emphasizing the importance of mutual consent and the practical realities of such reorganizations.