PER: RAKESH KUMAR GUPTA, MEMBER (A)

1. The applicant has filed the present Original Application under Section 19 of the Administrative Tribunals Act, 1985 seeking the following reliefs:

a) To set aside the communication No.53/D.35.13.08.2019-Estt dated 05.8.2019 (Annexure A-8) and direct the respondents to regularise the applicant as a Lower Division Clerk (LDC) from the eligible date and all other consequential benefits arising out of such regularization.

b) To pass such orders/directions that this Tribunal deems fit in the facts and circumstances of the case in the interest of justice and equity.

2. The facts of the case as averred by the applicant in his pleadings, are as follows:

a) The Applicant was selected for the post of Lower Division Clerk (LDC) vide Memorandum bearing No. 53.A. 12.14.1.87-Esst-I dated 29.12.1997 by the Regional Director, ESIC. The Applicant is serving the ESI Organization, since then without any break in service. The applicant belongs to S.T. Community.

b) There has been no break in his service from the date of his joining as LDC till date or interruption in his service or any blame or bad marks in his entire tenure of 23 years of service. He has been discharging his duties most obediently to the utmost satisfaction of his superiors. He has been granted all the benefits viz., annual increments various advance etc.,

c) The applicant submits that he made a detailed representation dated 20.8.2018 to the Grievances Redressal Committee, ESI Corporation New - Delhi for his regularization in the cadre of LDC among other things. The said representation was forwarded by the Director E.S.I.C S. S.R.O Peenya, Bangalore on 07.09.2018 to the Grievances Redressal Committee HQs Office E.S.I Corporation, New Delhi and requested therein to hear both sides before deciding the case. Since no reply was received against his representation as above, he gave one more representation dt. 07.12.2018 to the said Grievances Redressal Committee along with a covering letter submitted to the Director ESI Corporation SRO Peenya, Bangalore on 07.12.2018.

d) No tangible action was taken on his representation. He served a Legal Notice dated 10.06.2019 after waiting more than six months to all the respondents herein including the respondent No.1 herein. The Regional Director and Addl. Commissioner of Karnataka region gave a reply dated 5.8.2019 vide Lt. No. 53/0.35.13.08.2019 Estt., rejecting the request to regularize the services of the applicant on the grounds that he was appointed on Ad hoc basis, and this does not confer any further right for regularization among other things.

e) The applicant was appointed against the clear cut vacancy of LDC on Ad hoc basis and he is continuing in the service without any blame for the last 22 years and without there being any break in the service.

f) His services are required to be regularized, since his appointment was against a sanctioned vacant post and he is being continued for the last 22 years without intervention or orders of the Courts or Tribunals. The applicant is continuing for a long time and his services have to be regularized since he possesses the requisite qualification.

g) The inaction of the Respondents in not regularizing the applicant in the cadre of LDC is totally against the settled principles of law.

3. The respondents have filed their written statement wherein they have averred as follows:

a) The ESI Corporation is a Statutory Body set by an Act of Parliament called Employees' State Insurance Act 1948, under the control of Ministry of Labour and Employment, Govt., of India. Sec. 17(2) of the ESI Act deals with matters relating to Service conditions of Officers and employees.

b) The Applicant was appointed as LDC on ad hoc basis at Office of the Respondent No. 01 with effect from 29.12.1997 as at Annexure A-1 through Employment Exchange.

c) After the Applicant's reporting for duty as LDC on ad hoc basis, an Appointment Order has been issued to the Applicant by the Office of the Respondent No. 01 as per Office Order No. 64/98 which is communicated vide order No. 53.A.12.14.1.87.Estt.I dated: 07.01.1998 which is enclosed as Annexure R-1, stipulating the terms and conditions of the appointment which are reproduced as below:

"...... Their services will be terminated as and when the regular incumbents become available or vacancy ceases to exist whichever is earlier."

"The above ad hoc appointment do not confer on the officials any right for regular appointment to the post of LDC. Their services are liable to be terminated at any time, without any notice or without assigning any reasons thereof, as these appointment were made as a stop gap arrangement."

" ............ in the event of vacancy ceasing to exist or regular incumbent become available for the above posts, the principle of 'LAST COME FIRST GO' will be observed while terminating the services of the ad hoc employees and in the event of terminating the services of such ad hoc employees the requirements of Section 25(F) of Industrial Dispute Act will be followed."

d) With a view to regularize such purely temporary and ad hoc LDCs, the Respondent No. 3 vide communication dated 24.04.2003, which is annexed as Annexure R-2, had scheduled a Special Limited Examination on 11.05.2003 for regularization of ad hoc employees who were appointed through Employment Exchange and the Regional Directors were advised to conduct intensive training for the eligible officials on each working day (one hour prior to and one hour after the office hour) with emphasis on skill test. Though the Applicant was given training, he was not able to qualify in the Examination to regularize his service as LDC.

e) The Respondent ESI Corporation had scheduled the Limited Special qualifying examination for a second time on 17.10.2004 vide communication dated: 20.07.2004 which is annexed as Annexure R-3 exclusively for non-qualified officials in the previous examination conducted on 11-05-2003.

f) The Respondent ESI Corporation had scheduled the Limited Special qualifying examination for a Third time on 21.11.2008 vide communication dated: 19.08.2008 which is annexed as Annexure R-4 exclusively for non-qualified officials in the previous examinations conducted on 11.05.2003 and 17.10.2004.

g) The Applicant was given three opportunities to qualify and regularize his services as LDC, he has failed in all the aforementioned three examinations conducted on various dates. All the ad hoc employees appointed through Employment Exchange have qualified and their services have been regularized except the Applicant's. Some of the officials who were appointed as ad hoc LDCs along with the Applicant and qualified in the Special Limited Examination conducted by the Respondent No. 01 & 03 and currently promoted to the next higher posts.

h) The Applicant had not qualified in the Special Limited Examination conducted by the Respondent No. 01 & 03. However, the services of the Applicant was not terminated in view of the fact that sufficient vacancies were available in the cadre of LDC and hence, his service could not be terminated as per the conditions of the offer of appointment as at Annexure R-1. It is reiterated that as on date, 40 vacancies in the cadre of LDCs are available.

i) Respondent No. 03, vide Letter No.C-18/15/7/S.K./2013.E.II dated 05.10.2016 has approved to implement the Orders of the Hon'ble CAT, Chandigarh dated 11.11.2014 in O.A. 312/CH/2013 filed by Sarwan Kumar & 30 ors., and also approved to grant pay protection from date of regular appointment to the officials who were regularized after passing the Special Limited Examination conducted by ESI Corporation on 11.05.2003, 17.10.2004 and 21.11.2008. However, their services were not counted from the date of the ad hoc appointment. Further, it is submitted that Hqrs. Office of the Respondent ESI Corporation vide letter dated 10.05.2018 and 16.05.2018 had informed clearly that, those officials who joined as ad hoc LDCs and their services regularized through Special Limited Examination are entitled only for the grant of benefits of pay protection.

j) Since the Applicant has not qualified in the departmental examination conducted by the Respondent's Office like other similarly situated officials, his services have not been regularized. However, the official has availed all the benefits like a regular employee viz., allotted GPF account, EL encashment etc., and his pay was also re-fixed under 6th Pay Commission in PB-1 (5200- 20200 with Grade Pay of Rs. 1900/-) which is the corresponding pay of Rs. 3050-75-3950-80-4590 as per 5th Pay Commission for the post of LDC.

k) DoPT OM No. 49014/7/2020-Estt (c) dated: 07.10.2020, stipulated that "The one-time exercise who had put in 10 years of continuous service as on 10.04.2006 without availing the protection of any Interim Orders of Courts or Tribunals". Shri. H.N. Shivakumar was appointed as LDC on Ad hoc basis w.e.f. 29.12.1997, hence, he did not complete 10 years of continuous service as on 10.04.2006 as per DoPT aforesaid O.M. Hence, his request for regularization may not be accepted.

l) The Applicant has not qualified in the Special Limited Examinations conducted three times by the Respondent ESI Corporation exclusively for the officials who were in ad hoc services and employed through Employment Exchange and hence, the request of the applicant to regularize his services as LDC cannot be considered.

4. In his rejoinder to the reply, the applicant has pleaded as follows:

a) The respondents have misconceived the full bench judgment of Hon'ble Supreme Court in the case of Secretary, State of Karnataka and others Vs. Umadevi (hereinafter referred as Umadevi's case). The object behind the said direction in para 53 of Umadevi's case is two-fold, first to ensure that those who have put in more than 10 years of continuous service without the protection of any interim orders of Courts or Tribunals, before the date of decision in Umadevi's case was rendered, are considered for regularization in view of long service.

b) The true fact of the decision is that all who have worked for more than 10 years as on 10.04.2006 without the protection of any interim order of any Court or Tribunal, in vacant posts, possessing the requisite qualification, are entitled to be considered for regularization. The fact that the ESI Corporation/Respondent has not undertaken such exercise of regularization within six months of the decision in Umadevi's case. Hence, it will not dis-entitle the applicant, the right to be considered for regularization in terms of the above directions in Umadevi's case on a one time measure. Since the exception carved out in para 53 of Umadevi's case is applicable to the facts of the applicant's case.

c) The respondents have admitted in their objection statement that:

i. The applicant is appointed as LDC on ad-hoc basis with effect from 29.12.1997 through the Employment Exchange and on reporting for duty as LDC on ad-hoc basis, an appointment order was also issued (Annexure-R1).

ii. The applicant's services is being continued till this date, since there are 40 sanctioned posts of LDC is vacant even to this date.

iii. The applicant is granted all the benefits, which are enjoyed by regular employees and his pay was also fixed in the time scale of LDC as and when the Pay Commission Report was implemented.

d) The applicant further submits that he is possessing requisite qualification for appointing as LDC and he was called through Employment Exchange and on conducting the test, he was selected as LDC and thereby appointed as LDC and, therefore, his appointment is legal. He has an unblemished service record throughout his career and now he has put in 24 years of continuous service without any aid of any Court or Tribunal orders. The fact that the applicant did not qualify in the Examination schedule for regularization has no relevance, after the Umadevi's case. In view of the above facts, the applicant deserves to be regularized and his right cannot be defeated at the hands of the ESI Corporation, the model Employer.

e) The applicant is being continued even after the constitution Bench rendered its judgment in the year 2006, without any intervention from Court. The applicant is still continuing on this date also. Thus, the applicant very much deserves to be regularized.

5. Heard learned counsels for the parties and perused the pleadings made by them.

6. In the present case, the applicant has pleaded for regularisation of his services as LDC. He had joined as a LDC through Employment Exchange on 29.12.1997 on ad hoc basis in the office of Respondent No.1. The applicant is continuing as LDC on ad hoc basis since that date.

7. The services of other such ad hoc LDCs have already been regularised subsequent to their passing the special Limited Departmental examination held by the respondents subsequently. Three special limited departmental examinations had been conducted on 11.5.2003, 17.10.2004 and 21.11.2008. The persons who could not qualify the 1st examination held on 11.5.2003 had been given a 2nd chance in the examination held on 17.10.2004. Similarly, the 3rd examination held on 21.11.2008 was exclusively for people who had failed both the earlier examinations conducted on 11.5.2003 and 17.10.2004.

8. The applicant, despite being given these three opportunities failed to qualify. His services were not regularised as LDC, since he had failed in all these three examinations.

9. The applicant is relying on the Judgment passed by Hon'ble Apex Court in the case of State of Karnataka vs. Umadevi & Ors. (2006) 4 SCC. The applicant has specifically relied on para 53 of Umadevi's case, which is as follows:

"53. One aspect needs to be clarified. There may be cases where irregular appointments (not illegal appointments) as explained in S.V. NARAYANAPPA), R.N. NANJUNDAPPA and B.N. NAGARAJAN, and referred to in paragraph 15 above, of duly qualified persons in duly sanctioned vacant posts might have been made and the employees have continued to work for ten years or more but without the intervention of orders of courts or of tribunals. The question of regularization of the services of such employees may have to be considered on merits in the light of the principles settled by this Court in the cases above referred to and in the light of this judgment. In that context, the Union of India, the State Governments and their instrumentalities should take steps to regularize as a one- time measure, the services of such irregularly appointed, who have worked for ten years or more in duly sanctioned posts but not under cover of orders of courts or of tribunals and should further ensure that regular recruitments are undertaken to fill those vacant sanctioned posts that require to be filled up, in cases where temporary employees or daily wagers are being now employed. The process must be set in motion within six months from this date. We also clarify that regularization, if any already made, but not sub judice, need not be reopened based on this judgment, but there should be no further by-passing of the constitutional requirement and regularizing or making permanent, those not duly appointed as per the constitutional scheme."

10. The Hon'ble Apex Court had further observed in the case of State of Karnataka vs. M.L. Kesari & Ors. decided on 03.8.2010 in Civil Appeal No.6208.2010, as under:

"11. The object behind the said direction in para 53 of Umadevi is two- fold. First is to ensure that those who have put in more than ten years of continuous service without the protection of any interim orders of courts or tribunals, before the date of decision in Umadevi was rendered, are considered for regularization in view of their long service. Second is to ensure that the departments/instrumentalities do not perpetuate the practice of employing persons on daily-wage/ad-hoc/casual for long periods and then periodically regularize them on the ground that they have served for more than ten years, thereby defeating the constitutional or statutory provisions relating to recruitment and appointment. The true effect of the direction is that all persons who have worked for more than ten years as on 10.4.2006 (the date of decision in Umadevi) without the protection of any interim order of any court or tribunal, in vacant posts, possessing the requisite qualification, are entitled to be considered for regularization. The fact that the employer has not undertaken such exercise of regularization within six months of the decision in Umadevi or that such exercise was undertaken only in regard to a limited few, will not disentitle such employees, the right to be considered for regularization in terms of the above directions in Umadevi as a one-time measure."

11. The Hon'ble Apex Court in the case of Sheo Narain Nagar and others vs. State of Uttar Pradesh and another reported in 2017:INSC:1101 : (2018) 13 SCC 432 [LQ/SC/2017/1659] has categorically held that extracting work and not regularising the employees would be a form of exploitation from the hands of the State. It is apt to refer to the paragraph No.7 of this judgement, which reads as under:

"7. When we consider the prevailing scenario, it is painful to note that the decision in Uma Devi (Supra) has not been properly understood and rather wrongly applied by various State Governments. We have called for the data in the instant case to ensure as to how many employees were working on contract basis or ad-hoc basis or daily-wage basis in different State departments. We can take judicial notice that widely aforesaid practice is being continued. Though this Court has emphasised that incumbents should be appointed on regular basis as per rules but new devise of making appointment on contract basis has been adopted, employment is offered on daily wage basis etc. in exploitative forms. This situation was not envisaged by Uma Devi (supra). The prime intendment of the decision was that the employment process should be by fair means and not by back door entry and in the available pay scale. That spirit of the Uma Devi (supra) has been ignored and conveniently over looked by various State Governments/ authorities. We regretfully make the observation that Uma Devi (supra) has not been implemented in its true spirit and has not been followed in its pith and substance. It is being used only as a tool for not regularizing the services of incumbents. They are being continued in service without payment of due salary for which they are entitled on the basis of Article 14, 16 read with Article 34 (1)(d) of the Constitution of India as if they have no constitutional protection as envisaged in D.S. Nakara v. Union of India, (1983) 1 SCC 305 [LQ/SC/1982/209] ; 1983 SCC (L&S) 145; AIR 1983 SC 130 [LQ/SC/1982/209] , from cradle to grave. In heydays of life they are serving on exploitative terms with no guarantee of livelihood to be continued and in old age they are going to be destituted, there being no provision for pension, retiral benefits etc. There is clear contravention of constitutional provisions and aspiration of down trodden class. They do have equal rights and to make them equals they require protection and cannot be dealt with arbitrarily. The kind of treatment meted out is not only bad but equally unconstitutional and is denial of rights. We have to strike a balance to really implement the ideology of Uma Devi (supra). Thus, the time has come to stop the situation where Uma Devi (supra) can be permitted to be flouted, whereas, this Court has interdicted such employment way back in the year 2006. The employment cannot be on exploitative terms, whereas Uma Devi (supra) laid down that there should not be back door entry and every post should be filled by regular employment, but a new device has been adopted for making appointment on payment of paltry system on contract/ad hoc basis or otherwise. This kind of action is not permissible, when we consider the pith and substance of true spirit in Uma Devi (supra)."

12. As clarified by the Hon'ble Apex Court in the case of M.L. Kesari (supra), the directions in para 53 of Umadevi were to allow regularisation of only those ad hoc employees who had served for a period of more than 10 years as on the date of Judgment rendered by the Apex court in Umadevi (supra), which was 10.4.2006. Hence, in accordance with the judgement rendered in Uma Devi (supra) all persons who had been appointed on ad hoc basis prior to 10.4.1996 can be considered for regularization.

13. In the present case, the applicant had been appointed on ad hoc basis on 29.12.1997. Hence, he had completed only 9 years and 4 months as on 10.4.2006. He, therefore, cannot claim relief as granted by the Apex Court in the case of Umadevi (Supra).

14. However, it is a fact that the applicant is continuing on ad hoc basis after serving for more than 25 years in the department since 1997. The respondents had conducted 3 special examinations in order to screen the ad hoc employees prior to their regularisation. Despite the applicant not qualifying this examination even after 3 attempts, he has not been dis- engaged and continues to be employed by them on ad hoc basis.

15. The respondents have also stated that there are 40 vacancies still available in the post of LDC in the respondent's organisation.

16. A perusal of the minutes of the 158th Meeting of Standing Committee of ESI Corporation held on 17.12.2002 indicates as follows:

Item No. SC.15

Proposal for holding of special qualifying examination for regularisation of adhoc LDCs working in the ESIC Corporation

(38) Shri Mishra expressed the view that employees taken through Employment Exchange, but who continued on ad hoc basis for several years, thereby making them overage, should be regularised irrespective of their performance in the proposed test.

(39) It was explained by AC(P&A) and Insurance Commissioner that the proposed test was qualifying in nature and candidates obtaining a minimum marks to be fixed, would be regularised.

17. The above indicates that the proposed special examination was only qualifying in nature, which was intended to screen the candidates prior to their regularisation. In the present case, apparently the applicant has failed in the examination thrice, with the last such examination being held in the year 2008, i.e. around 15 years back. If the purpose of examination was to weed out those persons who failed to qualify, then in that case, the applicant should have been dis-engaged, after his failure to pass the qualifying examination for the 3rd time in the year 2008. However, the respondents have chosen to avail his services from 2008 till date in the post of LDC on ad hoc basis.

18. In the absence of any statutory rules on the subject, it is not understood as to how the ad hoc employees could have been regularised after passing a limited departmental qualifying examination. This method is not in accordance with the general principle that all appointments to a post should be held after inviting applications for the same from all eligible candidates in the open market, and then selecting from amongst them, suitable candidates after following the due process.

19. Be that as it may be, the only ground for not considering regularization of the applicant even after 25 years of ad hoc service by the respondents is his apparent failure in a departmentally held qualifying examination held 15 years back and the fact that he is not covered under the judgement given by the Apex court in Umadevi (supra).

20. As observed by the Apex Court in the case of Sheo Narain Nagar (supra), "the prime intendment of the decision in Umadevi's case was that the employment process should be by fair means and not by back door entry and in the available pay scale. That spirit of the Uma Devi (supra) has been ignored and conveniently over looked by various State Governments/ authorities. We regretfully make the observation that Uma Devi (supra) has not been implemented in its true spirit and has not been followed in its pith and substance. It is being used only as a tool for not regularizing the services of incumbents."

21. The Apex Court had further observed that "In heydays of life they are serving on exploitative terms with no guarantee of livelihood to be continued and in old age they are going to be destituted, there being no provision for pension, retiral benefits etc. There is clear contravention of constitutional provisions and aspiration of down trodden class. They do have equal rights and to make them equals they require protection and cannot be dealt with arbitrarily. The kind of treatment meted out is not only bad but equally unconstitutional and is denial of rights."

22. In the present case the applicant has not been regularized even after serving on ad hoc basis as LDC for the past 25 years only on the ground that he had not been able to qualify in a screening departmental examination held more than 15 years ago. This case, in our view, is squarely covered by the observations made by the Honourable Apex court in the case of Sheo Narain Nagar (supra).In our view, in the present case, the applicant cannot be denied regularization only on the grounds that he is not covered by the Uma Devi's case, or that he failed to qualify in a departmental screening test held fifteen years ago.

23. Keeping the above facts in view, it would be appropriate for the respondents to re-consider again the case of the applicant for regularisation by examining his case through a specially convened Committee which shall consider the case of the applicant for regularisation after examining his entire service records and ascertaining whether the applicant can now be considered fit for regularisation, since he has already served the organisation for more than 25 years on ad hoc basis.

24. The present OA is accordingly disposed of with the following directions:

a) The communication No.53/D.35.13.08.2019-Estt dated 05.8.2019 issued by the Respondent (Annexure A-8), is quashed.

b) The respondents shall constitute a Special Committee which shall consider the case of the applicant for regularisation after examining his entire service records to ascertain whether the applicant can now be considered fit for regularisation, keeping in view the fact that he has already served the organisation for more than 25 years on ad hoc basis.

c) Based on the recommendations of such a committee, the respondents shall regularize the applicant, if found fit. This entire exercise shall be completed expeditiously within a period of twelve weeks from the date of receipt of a certified copy of this order.

25. However, there shall be no orders so as to costs.