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REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION  

CIVIL APPEAL Nos. 8459-8461 OF 2010

State of Kerala & Ors. etc. etc. ...Appellants  Versus  

Arun George & Ors. etc. etc. ...Respondents WITH

CIVIL APPEAL Nos. 8463-8464/2010

The Deputy Director of Collegiate Education & Ors. ...Appellants

Versus   Dr. Joseph Michael & Ors. ...Respondents

WITH CIVIL APPEAL NO. 8466/2010

State Of Kerala & Ors. ...Appellants Versus   

Beena George & Ors. ...Respondents WITH

CIVIL APPEAL NO. 8470/2010

State Of Kerala & Ors. ...Appellants Versus

The Manager, Sacred  Heart College & Ors. ...Respondents

WITH CIVIL APPEAL Nos. 8471-8472/2010

State Of Kerala & Ors. etc. etc. ...Appellants Versus  

N.A.M. College & Ors. etc. etc. ...Respondents

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WITH CIVIL APPEAL NO. 8473/2010

State Of Kerala & Ors. ...Appellants Versus

Dr. A. Maria Starvin & Ors. ...Respondents WITH

CIVIL APPEAL NO. 8474/2010

State Of Kerala & Ors. ...Appellants Versus

Jesvin Jose & Ors. ...Respondents WITH

CIVIL APPEAL NO. 8475/2010 State Of Kerala & Ors. ...Appellants

Versus The Manager St. Plus  X College & Ors. ...Respondents

WITH CIVIL APPEAL NO. 8476/2010

State Of Kerala ...Appellants Versus

Dr. Anila. L. & Ors. ...Respondents WITH

CIVIL APPEAL NO. 8477/2010 State Of Kerala & Ors. ...Appellants

Versus Shacheendran V. & Ors. ...Respondents

WITH CIVIL APPEAL NO. 8478/2010

State Of Kerala & Ors. ...Appellants Versus

Salia Rex ...Respondent

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WITH CIVIL APPEAL NO. 8479/2010

State Of Kerala & Ors. ...Appellants Versus

Dr. R. Sunil Kumar & Ors. ...Respondents WITH

CIVIL APPEAL NO. 8480/2010 State Of Kerala & Ors. ...Appellants

Versus The Manager, St. Michael’s  College & Ors. ...Respondents

WITH CIVIL APPEAL NOs. 8481-82/2010

State Of Kerala & Ors. etc. ...Appellants  Versus

Reena Nair  & Ors. etc. ...Respondents WITH

CIVIL APPEAL NO. 8483/2010 Deputy Director Of Collegiate  Education & Anr. ...Appellants

Versus Omana Alex & Anr. ...Respondents

WITH CIVIL APPEAL NOs. 1202-1203 of 2015

(Arising out of SLP (c) NOs. 29423-24/2010

The Director Of Collegiate  Education & Anr. ...Appellants

Versus Sindhu P. Kauma & Ors. ...Respondents

WITH CIVIL APPEAL No. 1368/2011

State of Kerala & Ors. ...Appellants Versus

P.V. Sandhya & Ors. ...Respondents

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WITH CIVIL APPEAL NO. 10865/2011

State Of Kerala & Anr. ...Appellants Versus

Sreedevi S.R. & Ors. ...Respondents WITH

CIVIL APPEAL NOs. 10867-68/2011

State Of Kerala & Anr. etc. ...Appellants Versus

Dr. J. Leji & Ors. etc. ...Respondents WITH

CIVIL APPEAL NO. 1552/2012 State Of Kerala & Anr. ...Appellants

Versus Dr. N.B. Sreekala & Anr. ...Respondents

WITH

CIVIL APPEAL NOS. 8893-8894/2014 State Of Kerala & Ors. ...Appellants

Versus St. Peter's College Trust & Ors. ...Respondents

WITH

CIVIL APPEAL NO. 10869/2011

State Of Kerala & Anr. ...Appellants Versus

Sindhu K.V. & Ors. ...Respondents

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J U D G M E N T R. BANUMATHI, J.

1. Leave granted in Special Leave Petition (C) Nos. 29423-29424  of 2010.

2. State of Kerala  has filed these appeals assailing the order  passed by the High Court  allowing various review petitions  filed  by the respondents  and declaring that the conditions relied on by  the  Government  are  violative  of  the   provisions  contained  in  Direct Payment Agreement and the University Statutes and directing  the State to pay salary and allowances to the teachers  who were  appointed  by  the  Private  Managements  in  the  newly  commenced  courses.

3. The issue arising in these appeals being similar, the cases  were heard together and shall stand disposed of by this common  order. For convenience, the appeals filed by State of Kerala and  others in C.A. Nos. 8459-8461 of 2010 challenging the order dated  07.10.2009 in R.P. Nos. 101 & 180 of 2008 and W.A. No. 2529 of  2005 are taken as lead case.

4. Briefly stated the background facts are as under:- The State of Kerala accorded sanction on 09.11.1998 to the  

private educational  institutions and  managements for starting

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few new courses subject to  the condition that there should be no  additional financial commitment on the part of the State on that  account.  The  8th respondent-management  applied  to  the  Mahatama  Gandhi  University  and  the  university  vide  an  order  dated  13.11.1998 granted permission to start new   degree/graduate and  post-graduate courses w.e.f. the academic session 1998-99 without  any additional financial commitment to the University/Government.  The  managements  for  various  aided  colleges  including  the  8th  

respondent - management applied for affiliation of new courses.  The Government issued an order dated 06.12.1999 according sanction  for starting the new courses as mentioned in the appendix to the  Government  order  subject  to  the  condition  that  the  expenditure  will  not  exceed  the  budget  allotment  for  the  purpose  of  any  account.  Respondent Nos. 1 to 7 who were appointed by the 8th  

respondent-management to the various new courses sanctioned by the  Government, the management forwarded the proposal for approval of  their appointment to the university; but the same was rejected on  31.05.2002.  In the year 2003, staff fixation order was issued to  the Secretary of 8th respondent - management on 10.12.2003  for the  years 2001-02 and 2002-03.

5. Being  aggrieved by the non-approval of the appointment of  respondent nos. 1 to 8, respondents preferred Writ Petition (c)  No. 482 of 2005 seeking a writ of mandamus  and also to quash the  staff fixation orders.  Vide a judgment dated 12.08.2005, learned  Single Judge allowed the writ petition holding that the Government

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is liable to pay the salary and other allowances to the teachers  appointed to the new courses by the managements.

6. Aggrieved by the said order, State of Kerala preferred an  appeal bearing W.A. NO. 2529 of 2005. In the meantime, many writ  petitions were  filed on similar grounds. By the common judgment  dated 18.08.2007, Division Bench allowed the appeal filed by the  State of Kerala and dismissed the other writ petitions. Division  Bench  held  that  the  State  can  always  impose  conditions  while  according  sanction  and  the  condition  so  imposed,  that  the  new  appointments are without any additional financial commitment to  the State, is perfectly legal and valid and the private college  managements are bound by it.  

7. Aggrieved by the same, various review petitions were preferred  by  the  respondents  and  also  other  private  college  managements  contending that the said judgment dated 18.08.2007 was rendered  without adverting to the provisions of the University Act, the  Statutes, the Direct Payment Agreement and various judgments of  the Apex Court as also that of the  High Court. Vide a common  order  dated  7.8.2009,  the  Division  Bench  allowed  the  review  petitions holding that the conclusion of the Division Bench in  W.A.  No.  2529  of  2005  (dated  18.08.2007)  that  Direct  Payment  Agreement  do  not  apply  to  courses  subsequently  commenced,  is  directly contrary to Clause 35 of the Agreement. While allowing  the review petitions, the Court directed the State to pay salary

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and allowances to the teachers who were appointed by the private  managements in the newly commenced courses.  Being aggrieved, the  State has filed these appeals assailing the said order.

8. Mr.  C.S.  Rajan,  learned  senior  counsel  for  the  appellants  contended  that  Government  should  not  be  compelled  to  bear  the  salary and expenses of those teachers who were appointed by the  private managements, as private managements got the approval of  the new courses subject to the condition that there will be no  additional financial commitment. Further,  learned  senior counsel  for the State submitted that the private colleges, after accepting  the conditions in the Government Orders that there will be no  additional financial commitment, are estopped from contending  the  contrary and the University has rightly rejected the approval of  the  appointment  of  respondent  nos.  1  to  7  for  want  of  posts/strength  fixed for the academic year.

9. Per  contra,  Mr.  Babu  Varghese,  learned  senior  counsel  appearing for respondent no. 8 submitted that in the  guise of  imposing  restriction  of  financial  commitment  the  Government  is  violating the statutory provisions as well as the clauses in the  Articles of Direct Payment Agreement.   It was further contended  that they have fully discharged their obligation in terms of the  provisions of Direct Payment Agreement, in terms of admission of  students, collection of fees, reservation of seats as prescribed  by Government and remitted the same in the Government treasury

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and, therefore, the State is also obliged to perform its  mutual  obligation under the Articles of Direct Payment Agreement.  It was  also submitted that the documents obtained  under the provisions  of Right to Information Act which  are annexed would clearly show  that  there  had  been  budget  allocation  for  sanctioning  aided  courses and some of the teachers appointed in the new courses were  paid the salary.

10. Mr. Mathai M. Paikeday, learned senior counsel for  respondent  nos.  1  to  7  reiterated  the  above  submissions  and  additionally  submitted that the Government is bound to pay the salaries of the  teachers as both the selection of respondent nos. 1 to 7 and their  appointment  were  in  accordance  with  the  provisions  of  the  University Laws and Articles of  the Direct Payment Agreement.

11. We  have  also  heard  the  learned  counsel  for  all  other  respondents  who  are  represented  before  us  in  other  connected  matters.

12. We have carefully considered the rival contentions and perused  the impugned order and other materials  on record.  The main point  falling  for  consideration  is  in  respect  of   newly  commenced  courses  for  which  affiliation  was  granted  whether  the  State  Government is bound to pay the salary to the teachers for the  relevant period?

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13. Direct Payment System was evolved by the State Government vide  GOMS No. 185/72/Edn. dated 30.08.1972 for all the private Arts and  Science colleges.  Under the Direct Payment Agreement, Government  decided to introduce a scheme of direct payment of salaries to the  teaching  and  non-teaching  staff  of  private  colleges,  the  management of which agree to Government control in the matter of  appointment  of  the  teaching  and  non-teaching  staff  and  in  the  admission of students.  The control would be in the form of laying  down general principles to be followed and by participation  of  representative  of  the  Government  and  the  Universities  in  the  selection  and  appointment  of  staff  and  in  the  admission  of  students.   Thus,  a  scheme  for  direct  payment  of  salaries  in  private  Arts  and  Science  colleges  in  consultation  with  the  Universities,  the  representatives   of  the  private  college  managements   and  the  teaching  and  non-teaching  staff  representatives of the private colleges have been evolved.  The 8th  

respondent – management executed and agreed to the same and is  said to have complied with all the rules of the agreement.

14. Vide Government Order No. GOMS 134/98/H.Edn. dated 09.11.1998  sanction  was  accorded  for  starting  new  courses  subject  to  the  condition that there will be no additional financial commitment on  the part of Government.  Pursuant to the same, Vice-Chancellor of  Mahatma  Gandhi  University  vide  an  order  dated  13.11.1998  sanctioned  the  affiliation  of  the  new  courses  in  the  private  colleges from the Academic Year 1998-99  subject to ratification

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by the Syndicate and without any additional financial commitment.  Vide order dated 06.12.1999, Government granted approval for new  courses  subject  to  stipulation  that  the  expenditure  will  not  exceed the budget allotted for this purpose and University also  approved the same vide an order dated 10.12.1999 subject to the  same conditions as stipulated in the order dated 13.11.1998.

15. It appears that new courses so sanctioned led to the increase  of  work  load.  So  the  private  college  managements  acting  in  consonance  with  the  provisions  of  the  University  Statutes  and  Direct  Payment  Agreement  constituted  Statutory  Selection  Committee, the Committee comprised of both  the representatives of  the Government and the University. It is stated that respondent  nos. 1 to 7 were also appointed by the said Statutory Selection  Committee.  Respondent  Nos.1  to  4,  6  and  7  were   appointed  on  01.07.2002 and respondent no. 5 on 07.01.2002.

16. Learned senior counsel appearing for the  respondent nos. 1 to  7  has urged  that  GOMS No. 134/98/H/Edn. dated 09.11.1998 and  GOMS  No.  162/99/H/Edn.  were  issued  only  to  accommodate  the  lecturers  who  were  rendered  surplus  due  to  de-linking  of  pre- degree courses from the colleges and the same fact is evident from  annexure R1/3.  It is stated that due to de-linking of pre-degree  courses, Pre-degree Courses (Abolition) Act, 1997  was passed and  as  per  Section  5  of  the  Act,  a  statutory  ban  was  imposed  on  appointments  for  a  period   of  three  years  commencing  from

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03.06.1997 to 02.06.2000. However, after the expiry of the period,  the State has not fixed staff pattern.  Hence,  respondent no. 8  and  Kerala  Private  College  Management  Association   and  other  private colleges approached the High Court by OP No. 21268 of 2002  which was disposed of directing the university to fix the staff  strength  in  the   respondents'  colleges   and  to  consider  the  representations  of  the  private  colleges  in  accordance  with  the  Statutes and Ordinances.  As the University did not comply with  the  order,  contempt  proceedings  were  initiated  against  the  University  and  it  has  later  approved  certain  appointments;  but  rejected the appointment of  respondent nos. 1 to 7 due to want of  vacancy and also due to the fact  that the courses were sanctioned  without any financial commitment on the part of the  Government.  Appointments of respondent nos. 1 to 7 were thus not approved and,  hence, they were not getting salary.

17. Although,  initially  approval  was  not  granted  for  the  appointments of respondent nos. 1 to 7, the University granted  approval to these appointments vide its order No. AC.B1/1/3169/05  dated 29.10.2005.  As noticed earlier, sanction of new courses led  to the increase of work load and the services of  respondent nos.  1  to  7  were  utilised  by  the  8th respondent  –  management.  The  courses are purely aided courses and therefore, the provisions of  Direct  Payment  Agreement  are  undoutedly  applicable.  The  State  administration cannot  shirk its responsibility of ensuring proper  and  quality education in Schools and Colleges on the plea of lack

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of resources.  In the facts and circumstances of the case in hand,  we  do not deem it necessary to consider this question in further  detail.

18. It is also to be noted that by perusal of the records viz.  Annexures R8/14, 15, 16, 17 & 18, it is evident that respondent  nos. 1 to 7 were appointed only against sanctioned posts.  It is  not the case of the Government that 8th respondent – management  violated the terms of the Direct Payment Agreement. For many years  i.e. from 2002,  services of respondent nos. 1 to 7 have been  utilized   for  imparting  instruction,  invigilation  and   other  duties. By perusal of the information obtained under  Right to  Information  Act  that  the  Government  has  paid  salaries  and  emoluments to some of the lecturers appointed in other private  colleges. When the respondent nos. 1 to 7 were appointed  by the  Statutory  Selection  Committee,  we  find  no  reason  as  to  why  respondent nos. 1 to 7 should be denied the payment of salary.  When  respondent nos. 1 to 7 have been  appointed by the Statutory  Selection Committee, it becomes obligatory for the  Government to  honour these appointments and pay the salary.  

19.  In our considered view, the learned Single Judge of the High  Court and the Division Bench in review petitions rightly held that  respondent nos. 1 to 7 are entitled to the payment of salary for  the relevant period and we find no reason to interfere with the  same.

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20. In the result, these appeals are dismissed and consequently,  the other connected appeals stand dismissed.

..........................J. (V. GOPALA GOWDA)

..........................J. (R. BANUMATHI)

NEW DELHI; JANUARY 14, 2015.