1. Leave granted.

2. The respondent herein was an employee of the appellant. On or about 12-7-1994, an agenda of a meeting was placed before the Municipal Executive Council being Agenda No. 143, which is in the following terms:

"As per the guidelines of the Government, the Municipal Council had required a clerk on contract basis immediately as in the octroi branch, one post is vacant and two employees are already on leave: for the engagement of Shri Raj Kumar s/o Shri Nathu Ram r/o Samrala who had already worked under the Municipal Council @ Rs 1000 p.m., till it deems necessary."

3. The said proposal came to be accepted by the Executive Council. Pursuant thereto the respondent herein was appointed as a clerk on contract basis on a monthly salary of Rs 1000. In the offer of appointment it was specifically averred that "his services will be availed till it is considered as fit and proper and necessary. After that his services will be dispensed with".

4. The respondent affirmed an affidavit inter alia stating:

(1) That I am engaged as clerk on contract basis by the Municipal Council, Samrala @ Rs 1000 p.m. from 24-6-1994.

(2) That I am ready to do whatsoever job or department assigned to me by the Municipal Council, Samrala.

(3) That I have no objection if the Municipal Council, Samrala would have dispensed with my services as they have a right to do this. His services were dispensed with by an order dated 22-5-1997.

5. An industrial dispute having been raised, the matter was referred to the Labour Court, Ludhiana. In its award dated 11-2-2003, the learned Presiding Judge, Labour Court came to the conclusion that:

"It has been established that in the first spell, the workman worked from 24-6-1994 to 2-3-1996 and again from 7-3-1997 to 21-5-1997 and his services having been terminated vide office order Ext. M 5, he had worked for more than 240 days in the last calendar year, prior to termination of his services."

6. It is, thus, not in dispute that the respondent had worked intermittently. Furthermore, there does not appear to be any dispute that the terms of employment were as contained in the offer of appointment as noticed supra. The learned Presiding Judge, Labour Court in terms of his award dated 11-2-2003, on a finding that the said order of termination of the respondent was in violation of the provisions of S.25F of the Industrial Disputes Act, 1947 (" the" for short) directed that he be reinstated in service with 25% back wages. The appellant herein filed a writ petition before the High Court of Punjab and Haryana, which by reason of the impugned judgment has been dismissed.

7. Before the High Court as also before us, the appellant contended that having regard to the provisions contained in S.2(oo)(bb) of the Industrial Disputes Act, the respondent having been appointed for a fixed period on contract basis, S.25F of the will have no application in the facts and circumstances of this case. Both the learned Judges of the Labour Court as also of the High Court negatived the said contention on the ground that the offer of appointment issued in favour of the respondent did not indicate that the same was for a fixed period.

8. Learned counsel appearing on behalf of the appellant raised a short question in support of this appeal. It was submitted that having regard to the definition of "retrenchment" as contained in S.2(oo)(bb), the respondent having been appointed on a contract basis, the provisions of S.25F will have no application. Learned counsel appearing for the respondent, on other hand, submitted that the terms and conditions of appointment of the respondent nowhere suggest that the same was in relation to either in respect of a project or for a fixed period, and in that view of the matter the provisions of S.2(oo)(bb) of the would have no application in the instant case. Learned counsel furthermore urged that from a perusal of the order dated 22-5-1997, whereby the services of the respondent were terminated, it would not appear that the services of the respondent were not required or the appellant did not consider it to be fit or appropriate or necessary to continue the respondent in service and thus the condition precedent contained in the offer of appointment has not been complied with. It was moreover urged that in view of the finding of fact arrived at by the learned Labour Court that the respondent herein was appointed intermittently without specifying any period of service as also the purpose for which he was appointed, the provisions of S.25F would be attracted.

9. S.2(oo)(bb) of the Industrial Disputes Act reads as under:

"2. Definitions. -- In this Act, unless there isanything repugnant in the subject or context, --

(oo) retrenchment means the termination by the employer of the service of a workman for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action, but does not include --

(a) voluntary retirement of the workman; or

(b) retirement of the workman on reaching the age of superannuation if the contract of employment between the employer and the workman concerned contains a stipulation in that behalf; or

(bb) termination of the service of the workman as a result of the non renewal of the contract of employment between the employer and the workman concerned on its expiry or of such contract being terminated under a stipulation in that behalf contained therein; ...."

10. Clause (oo)(bb) of S.2 contains an exception. It is in two parts. The first part contemplates termination of service of the workman as a result of the non renewal of the contract of employment or on its expiry; whereas the second part postulates termination of such contract of employment in terms of stipulation contained in that behalf. The learned Presiding Officer of the Labour Court as also the High Court arrived at their respective findings upon taking into consideration the first part of S.2(oo)(bb) and not the second part thereof. The circumstances in which the respondent came to be appointed have been noticed by us hereinbefore.

11. The appellant is a Municipal Council. It is governed by the provisions of a statute. The matter relating to the appointment of employees as also the terms and conditions of their services indisputably are governed by the provisions of the relevant Municipal Act and / or the rules framed thereunder. Furthermore, there is no doubt that the matter relating to the employment in the Municipal Council should be governed by the statutory provisions and thus such offer of appointment must be made by a person authorised therefor. The agenda in question was placed before the Executive Council with a view to obtain requisite direction from it wherefor the said letter was written. The reason for such appointment on contract basis has explicitly been stated therein, namely, that one post was vacant and two employees were on leave and in that view of the matter, services of a person were immediately required in the Council. Thus, keeping in view the exigency of the situation, the respondent came to be appointed on the terms and conditions approved by the Municipal Council.

12. We have noticed hereinbefore that the respondent understood that his appointment would be short lived. He furthermore understood that his services could be terminated at any point of time as it was on a contract basis. It is only in that view of the matter, as noticed hereinbefore, that he affirmed an affidavit stating that the Municipal Council of Samrala could dispense with his services and that they have a right to do so.

13. In the decision of this Court in S.M. Nilajkar v. Telecom Distt. Manager (2003 SCC (L&S) 380) whereupon the learned counsel for the respondent placed strong reliance, this Court was concerned with a different fact situation obtaining therein. In that case, a scheme for absorption of the employees who were appointed for digging, laying cables, erecting poles, drawing lines and other connected works was made which came into force with effect from 1-10-1989, and only those whose names were not included for regularisation under the said scheme, raised disputes before the Assistant Labour Commissioner, Mangalore. The termination of the services of casual mazdoors by the management of Telecom District Manager, Belgaum, thus came to be questioned in the reference made by the appropriate Government in exercise of its power conferred upon it under S.10 of the Industrial Disputes Act. This Court, having regard to the contentions raised by the respondents that the appellant therein was engaged in a particular type of work, namely, digging, laying cables, erecting poles, drawing lines and other connected works in the project and expansion of the Telecom Office in the district of Belgaum was of the opinion: (SCC p. 37, para 13)

"13. The termination of service of a workman engaged in a scheme or project may not amount to retrenchment within the meaning of sub clause (bb) subject to the following conditions being satisfied:

(i)) that the workman was employed in a project or scheme of temporary duration;

(ii) the employment was on a contract, and not as a daily wager simpliciter, which provided inter alia that the employment shall come to an end on the expiry of the scheme or project;

(iii) the employment came to an end simultaneously with the termination of the scheme or project and consistently with the terms of the contract; and

(iv) the workman ought to have been apprised or made aware of the abovesaid terms by the employer at the commencement of employment."

14. The decision of this Court is not an authority for the proposition that apart from a project or a scheme of temporary duration, S.2(oo)(bb) of the Industrial Disputes Act will have no application. Furthermore, in the instant case, as has been noticed by this Court in S.M. Nilajkar (2003 SCC (L&S) 380) itself, the respondent was categorically informed that as per the terms of the contract, the same was a short lived one and would be liable to termination as and when the appellant thought it fit or proper or necessary to do so. Yet again, this Court in view of the facts and circumstances prevailing therein had no occasion to consider the second part of S.2(oo)(bb) of the said Act.

15. There is neither any doubt nor any dispute that the terms and conditions contained in the offer of appointment on both the spells were the same. So far as the employment of a person in a Municipal Council which is "State" in the meaning of Art.12 is concerned, the same must be done in terms of the provisions of the statute and / or rules framed thereunder. The respondent therefore was not appointed on a permanent or a temporary basis. It is not the case of the respondent that while making an offer of appointment, the Municipal Council had complied with the requirements laid down in the statute or statutory rules or even otherwise the same was in conformity with Art.14 and 16 of the Constitution.

16. For the reasons aforementioned we are of the opinion that the instant case is covered by the second part of S.2(oo)(bb) of the said Act.

17. For the reasons aforementioned, the impugned judgment cannot be sustained. It is set aside. Accordingly, the appeal is allowed but in the facts and circumstances of the case there shall be no order as to costs.