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Non-Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 5441 OF 2016  (Arising out of S.L.P. (C) No.2324 of 2010)

Harijan Paniben Dudabhai …… Appellant

Versus

State of Gujarat and others …… Respondents

With

CIVIL APPEAL NO. 5442  OF 2016  (Arising out of S.L.P. (C) No.8896 of 2010)

 CIVIL APPEAL NO. 5443 OF 2016  

(Arising out of S.L.P. (C) No.1305 of 2011)

and CIVIL APPEAL NO. 5444 OF 2016  

(Arising out of S.L.P. (C) No. 9756 of 2011)

JUDGMENT

Uday Umesh Lalit, J.

1.  Leave granted.

2. These  appeals  challenge  common  judgment  of  the  High  Court  of

Gujarat dated 02.07.2009.  As Letters  Patent Appeal No.1522 of 2004 was

considered  as lead  matter by the High Court,  the appeal arising therefrom

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is also considered as lead matter by us.   The facts giving rise to Letters

Patent Appeal No.1522 of 2004 are dealt with in detail hereafter.

3. In terms of Gujarat Government Gazette dated 01.07.1961,    the then

Okha  District  Municipality  got  converted  into  Okha  Gram  and  Nagar

Panchayat on and w.e.f. 02.02.1962. Upon such conversion, the existing staff

of  municipality  was  allocated  to  Gram Panchayat  and  treated  as  part  of

Panchayat Service. Gujarat Panchayats Act, 1961 (hereinafter referred to as

the “Act”) deals with Panchayat Service and various sets of Rules framed

pursuant to the power conferred under the Act, deal with matters including

classification  of  Panchayat  Service  and  conditions  of  service  as  regards

Panchayat Service.  

4. Section 203 of the Act is to the following effect:

“203. Panchayat Service to be regulated by rules – (1) For this purpose of bringing about uniform scales of pay uniform conditions of service for persons employed in the discharge of functions and duties of panchayats, there shall be constituted a Panchayat Service in connection with the affairs of panchayats. Such service shall be distinct from the State service.

(2) The  Panchayat  Service  shall  consist  of  such  classes, cadres  and  posts  and  the  initials  strength  of  officers  and servants in each such class and cadre shall be such, as the State Government may by order from time to time determine:

Provided that nothing in this sub-section shall prevent a district panchayat from altering, with the previous approval of the State Government, any class, cadre or number of posts so determined by the State Government.

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(2A) (a) The  cadres  referred  to  in  sub-section  (2)  may consist of district cadres, taluka cadres and local cadres.

(b) A servant  belonging  to  a  district  cadre  shall  be liable to be posted,  whether by promotion or  transfer  to any post in any gram or nagar in the same taluka.

(c) A  servant  belonging  to  a  taluka  cadre  shall  be liable to be posted,  whether by promotion or  transfer  to any post in any gram or nagar in the same taluka.

(d) A servant belonging to a local cadre shall be liable to be posted whether by promotion or transfer to any post in the same gram or, as the case may be, nagar.

(2B) In  addition  to  the  posts  in  the  cadres  referred  to  in sub-section (2A),  a panchayat may have such other posts of such classes as the State Government may, by general or special order determine.  Such posts shall be called “deputation posts” and shall be filled in accordance with the provisions of Section 207.

(3) Subject  to  the  provisions  of  this  Act,  the  State Government  may  make  rules  regulating  the  mode  of recruitment  either  by  holding examinations  or  otherwise  and conditions  of  service  of  persons  appointed  to  the  panchayat service and the powers in respect of appointments, transfers and promotions of officers and servants in the panchayats service and disciplinary action against any such officers or servants.

(4) Rules  made  under  sub-section(3)  shall  in  particular contain –

(a) a  provision  entitling  servants  of  such  cadres  in  the Panchayat Service to promotion to such cadres in the State Service as may be prescribed.

(b)A  provision  specifying  the   clauses  of  posts recruitment  to  which  shall  be  made   through  the

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District Panchayat Service Selection Committee and the class of posts, recruitment  to which shall be made by  the  Gujarat  Panchayat  Service  Selection  Board, and  

(c) A provision regarding the percentage of vacancies to be  reserved  for  the  members  of  Scheduled  Castes, Scheduled Tribes and other backward classes in the Panchayat Service.

(5)    Such rules may provide for inter district transfers of servants belonging to the Panchayat Service and the circumstances in which and the conditions subject to which such transfers may be made .

(6) The promotion of a servant in a cadre in the Panchayat Service to a cadre in the State service in accordance with the rules made under clause (a) of the sub-section (4) shall not affect-

(a)   any obligation or liability incurred or default committed by such servant during the period of his service in a cadre in the Panchayat Service while  acting  or  purporting  to  act  in  the discharge of his duties as such servant, or  

(b)    any  investigation,  disciplinary  action  or remedy in respect of such obligation, liability or  default  and  any  such  investigation, disciplinary  action  or  remedy  may  be instituted, continued or enforced in accordance with the law applicable thereto during the said period of service by such authority as the State Government may, by general or special order specify in this behalf.”

5. In  State of Gujarat and another v.  Ramanlal Keshavlal Soni and

others1 a  Constitution  Bench  of  this  Court  held  that  Panchayat  Service

1    (1983) 2 SCC 33

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constituted under aforesaid Section 203 of the Act is a Civil Service of the

State and the members of the Service are government servants.

6. Coming to the facts of the lead matter, one Vela Keshav, deceased

husband of the appellant was appointed by Okha Gram Panchayat as Safai

Kamdar on 04.02.1964.  After having put in 33 years of service, he died in

harness on 06.02.1997. The record indicates that monetary benefits such as

Rs.14525.50  towards  leave  encashment,  Rs.26,042/-  towards  Group

Insurance and Rs.54,221/- towards General Provident Fund were paid to the

appellant as legal representative of the deceased.  The appellant represented

that  the  family  of  Vela  Keshav  was  also  entitled  to  family  pension  and

gratuity  which claim having not  been accepted,  the appellant  moved the

High Court by filing Special Civil Application No. 354 of 2004.

7. Affidavits in opposition were filed by Deputy District Development

Officer, District Panchayat, Jamnagar as respondent no.3 and by Sarpanch of

Okha Gram Panchayat as respondent No.5.  It was submitted by them that

since the deceased was not recruited by the Gram Panchayat in accordance

with  the  Statutory  Rules,  the  appellant  was  not  entitled  to  claim family

pension.  The matter came up before a Single Judge of the High Court who

by her order dated 15.07.2004 dismissed the Special Civil Application.  The

submission advanced on behalf of the respondents that since the deceased

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was not appointed by the District Panchayat Service Selection Committee

constituted  under  Section  2(11)  of  the  Act,  was  not  a  member  of  the

Panchayat Service as envisaged by Section 203 of the Act and as such the

appellant  was  not  entitled  to  claim  any  family  pension  or  gratuity,  was

accepted by the Single Judge.

8. The  appellant  being  aggrieved  carried  the  matter  further  by  filing

Letters Patent Appeal No.1522 of 2004.  At the appellate stage affidavit in

reply filed by District Development Officer, District Panchayat,  Jamnagar

reiterated the earlier  stand.    An affidavit  in reply on behalf  of  the State

Government was filed by Deputy Secretary, Panchayats, Rural Housing and

Rule Development Department, Gandhi Nagar which dealt with the matter in

issue in following terms.

“In  the  present  case,  since  appellant  has  not  undergone  any selection procedure and he has obtained the employment only on the strength of passing resolution in panchayat, Okha Gram Panchayat  has  not  made  any  proposal  to  regularize  such unauthorized  recruitment  and  appointment  of  petitioner’s husband.  Therefore, he cannot be treated as an employee of local  cadre  of  panchayat  service  and  since  he  cannot  be considered as a member of panchayat service, he is not entitled for any pensionary benefits from government treasury.  It is the responsibility  of  Okha  Gram  Panchayat  to  pay  pensionary benefit from its own fund as per the terms and conditions at the time  of  petitioner’s  husband  appointment  by  Okha  Gram Panchayat…….”

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However what was the procedure which was prevalent in 1964 and

how the appointment was bad or illegal, was not specified

9. The  reply  filed  on  behalf  of  respondent  no.5  by  the

Administrator of Okha Municipal Borough was as under:

“The appointment of deceased Vela Keshav was made by the Gram Panchayat by passing a Resolution and he was holding the  post  within  the  sanctioned  set  up  of  Safai  Kamdars (Sweepers).   The  said  Resolutions  of  the  Gram  Panchayat making the appointment  of  the deceased are  not  available  at present.   However,  the  necessary  entry  made  in  the  Service Book of the deceased employee showing the other details in the Service Record is available. ……..

The deceased employee was appointed as a Full time employee on the sanctioned set up of the Gram Panchayat getting regular salary. …….

The Okha Gram Panchayat appointed him as Safai Kamdar on the terms and conditions as its own employee where there were no  rules.   However,  the  fact  remains  that  the  deceased  was holding the post on the set up sanctioned by the Development Commissioner and had continued till his retirement2 as a regular full  time  employee.   Further,  it  cannot  be  said  that  his appointment was not made in accordance with the provisions under Section 203 of the Panchayat Act because no such rules of recruitment were as such framed on the date on which the deceased was appointed on 4.2.1964.”

2

  The Affidavit wrongly mentioned that the employee had continued till he  retired.  As a matter of fact, Vela Keshav had died in harness.

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10. The Division Bench of  the  High Court  by  its  judgment  and order

under appeal dismissed Letters Patent Appeal No.1522 of 2004 and other

connected matters.    It was observed that only those employees who had

been appointed following the procedure laid down in Section 203 of the Act

and  the  rules  framed thereunder,  would  alone  be  members  of  Panchayat

Service,  apart  from the allocated employees from the municipality to the

Panchayats  at  the  time  of  formation  of  the  Panchayats  or  such  other

employees who had been recognized as members of Panchayat Service by

the State Government, or by the District Panchayat Selection Committee.  It

was further  observed that  merely because Panchayat  had paid salary and

other  benefits  to  the  deceased,  it  did  not  mean  that  he  was  member  of

Panchayat  Service  so  as  to  get  the  benefits  available  to  members  of

Panchayat Service like family pension and gratuity.

11. In the present case the deceased was appointed as Safai Kamdar on

4.2.1964 by Gram Panchayat by passing an appropriate resolution.  It is true

that Section 203(3) of the Act empowers the State Government to make rules

regulating mode of recruitment.  Our attention in that behalf was invited to

Gujarat Service (Appointing Authorities) Rules, 1967.  Rule 2 of the said

Rules stipulates, inter alia, that the Appointing Authority in respect of posts

under the Gram Panchayat, which are included in the “local cadre” is Gram

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Panchayat  itself.   The  term “local  cadre” finds elaboration in  Part  III  of

Gujarat Panchayat Service (Conditions of Service) Rules, 1977 (hereinafter

referred to as “the 1977 Rules).  Part III  captioned “Local Cadre” is to the

following effect:

“I. Secretary of a Nagar Panchayat  II The following posts under the Nagar or as the Case may

be, Gram Panchayat, namely –

1. Chief Officer (Nagar Panchayat) 2. Head Clerk 3. Senior Clerk 4. Junior Clerk 5. Vasulati Clerk 6. Typist 7. Octroi clerk 8. Accountant 9. Cashier 10.Tax Inspector 11.Shop Inspector 12.Octroi Inspector 13.Overseer 14.Power House Manager  15.Driver 16.Cleaner 17.Posts required for schools run by the Panchayat 18.Posts required for dispensaries run by the Panchayat 19.Posts required for libraries run by the Panchayat 20. Posts required for dispensaries run by the Panchayat

III All  posts  belonging  to  the  inferior  panchayat  Service under Gram Panchayat or Nagar Panchayat.

IV All  other  technical  and  non-technical  posts  under  the Gram Panchayat or Nagar Panchayat.”

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12. Item III  of  aforementioned  Part  III  deals  with  “Inferior  Panchayat

Service” under Gram Panchayat or Nagar Panchayat which term is defined

inter alia in Rule 2(h) of the 1977 Rules, as under:

“2(h) “Superior  Panchayat  Service”  and  “Inferior  Panchayat Service”  means  respectively  the  Superior  Panchayat  Service and the Inferior Panchayat Service as constituted respectively by clause (a) and clause (d) of sub-rule (2) of Rule 3 of the Gujarat  Panchayat  Service  (Classification  and  Recruitment) Rules, 1967.”

Sub-rule  (2)  of  Rule  3  of  the  Gujarat  Panchayat  Service

(Classification and Recruitment) Rules, 1967 deals with Panchayat Service

and  stipulates  that  it  shall  consist  of  two  classes,  namely,  “Superior

Panchayat Service” and “Inferior Panchayat Service”.

13. The statutory provisions as mentioned above and the clear assertion

by Respondent No.5 in his affidavit in reply, shows that in the year 1964

when  deceased  Vela  Keshav  came  to  be  appointed,  there  were  no  rules

governing  the  appointment  in  question.   The  rules  regulating  ‘Superior

Panchayat Service’ and ‘Infereior Panchayat Service’ in the form of Gram

Panchayat Service (Classification and Recruitment) Rules, 1967 came on the

statute  book in the year  1967.   Going by the Gujarat  Panchayat  Service

(Appointing Authorities)  Rules,  1967, Gram Panchayat  is  the appropriate

authority in respect of posts included in the Local Cadre.  Thus, we do not

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find any infraction in the appointment of Vela Keshav, who was appointed

pursuant to a resolution passed by Panchayat.  Nothing has been pointed out

how Gram Panchayat was not competent to make such appointment or that

at the relevant time in question the power to make appointments was vested

in an authority other than Gram Panchayat or that there was any separate

modality or procedure prescribed for effecting such an appointment.

14. As detailed in the affidavit in reply on behalf of Respondent No.5, the

deceased Vela Keshav was holding the post within the sanctioned set up of

Safai Kamdars and that he was a full time employee getting regular salary.

The  deceased  Vela  Keshav  had  put  in  33  years  of  service  and  died  in

harness.  At no stage, while he was in service any objection or even a doubt

was raised that he was not validly appointed.  In our view, Vela Keshav must

be held to  be one who was regularly appointed and we do not  find any

infirmity or illegality in his appointment so as to disentitle the family of the

benefits of family pension and gratuity.  

15. At  this  stage,  Circular  dated  26.02.2008  issued  by  Government  of

Gujarat,  Panchayat Rural Housing and Rural Development on 26.02.2008,

which  was  placed  on  record  by  way  of  Additional  Documents,  may  be

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adverted  to.   This  Circular  after  considering  cases  of  those  who  were

appointed between 1.04.1963 and 5.05.1984, stated as under:

“It is, therefore, informed to all the District Development Officers  to  initiate  proceedings  in  accordance  with  the instructions given vide letters cited at preamble for regularizing services  of  the  employees  appointed/recruited  under  the converted  gram/nagar  panchayats  during  the  period  from 1.4.1963  to  10.7.1978  and  10.07.1978  to  5.06.1984  and  to decide their other service related matters accordingly.  Further, it  is  also  hereby  informed  to  submit  proposal  of  posts  of remaining employees as per item no.1 of letter at preamble 1 who have been recruited/appointed promoted during the period from  10.07.1978  to  5.06.1984  and  on  other  aspects  of  the aforesaid  letters  also,  if  guidance/approval  is  required,  DDO shall have to submit proposal through Development Officer’s office within six months after examining service record of each employee with their clear opinion.”  

16. In the totality of circumstances, we find that the appellant cannot be

denied the benefits in question.  We, therefore allow this appeal and set aside

the judgments and orders  rendered by the Single Judge and the Division

Bench and allow Special Civil Application No.354 of 2004. We direct the

respondents to pay to the appellant all the arrears of pensionary benefits and

gratuity with simple interest at the rate of 9% per annum within two months

from the date of this Judgment.

17. In appeal arising out of SLP(C) No.8896 of 2010, the appellant was

appointed as a Peon on 4.4.1964 and in due course of time was promoted to

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the post of Sanitary Mukadam and later to the post of Octroi Clerk.  He

retired  in  the  year  2001  after  having  put  in  37  years  of  service  and  all

through  he  was  paid  all  the  benefits  including  those  under  4 th Pay

Commission as a regular employee would receive.    His case was dealt with

on the strength of the Judgment in the lead matter by the High Court and

since we have set aside the view taken by the High Court in the lead matter,

this appeal  also deserves to be allowed.  While condoning the delay and

allowing  the  appeal,  the  respondents  are  directed  to  pay  the  arrears  of

pensionary benefits and the amount of gratuity to the appellant along and

gratuity with simple interest at the rate of  9% per annum within two months

from the date of this Judgment.

18. In  appeal  arising  out  of  SLP(C)  No.9756  of  2011,  the  deceased

husband of  the  present  appellant  was  appointed as  Sanitary Inspector  by

Okha Gram Panchayat on 14.12.1964 and the said appointment was later

confirmed by Development Commissioner vide order dated 5.4.1973.  In

accordance with the view taken by us in the lead matter, this appeal also

deserves to be allowed.  Allowing the appeal, we direct the respondents to

pay to the appellant  all  the arrears  of  family pension and the amount of

gratuity with simple interest at the rate of 9% per annum within two months

from the date of this Judgment.

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19. In appeal arising out of SLP(C) No.1305 of 2011 the appellant, 55 per

cent  physically  handicapped,  was  appointed  as  Typist-cum-Clerk  on

13.10.1969 and retired  from service  in  the  year  2001.  It  is  true  that  his

appointment  was  after  the  Gujarat  Panchayat  Service  (Appointing

Authorities)  Rules,  1967 and other  set  of  Rules came into force.     But

nothing has been placed on record indicating any prevalent procedure which

was allegedly infracted or any reason why his appointment could be termed

as illegal or invalid.  All through his service till he retired, he was paid all

the emoluments and salary like any regular employee.  We see no reason

why the appellant could be denied the pensionary benefits and gratuity.  We

allow this appeal and direct the respondent to pay to the appellant family

pension and the amount of gratuity with simple interest at the rate of 9% per

annum within two months from the date of this Judgment.

20. All the appeals are allowed in the aforesaid terms without any order as

to costs.

……………………………..J, (V. Gopala Gowda)

……………………………..J. (Uday Umesh Lalit)

New Delhi, July 1 , 2016