Case Note & Summary
The Supreme Court considered appeals by Khetri Vikas Samiti, a society running educational institutions, against the reinstatement of employees terminated due to abolition of posts. The private respondents were engaged as Lab Assistant, Sweeper, Mechanic, and Waterman on temporary basis. In July 2003, the Managing Committee resolved to abolish these posts due to heavy losses and paid six months' salary. The employees challenged their termination before the Non-Government Educational Tribunal, which ordered reinstatement for lack of prior approval under Section 18 of the Rajasthan Non-Government Educational Institutions Act, 1989. The High Court upheld this order. The Supreme Court allowed the appeals, holding that Section 18 applies only to disciplinary terminations, not to bona fide abolition of posts. The court emphasized that the management's decision was based on financial difficulties and was not penal. The reinstatement orders were set aside, and the appeals were allowed.
Headnote
A) Service Law - Abolition of Posts - Section 18 of Rajasthan Non-Government Educational Institutions Act, 1989 - Termination due to abolition of post does not require prior approval under Section 18 as it is not a penal action - The court held that Section 18 applies only to disciplinary terminations, not to bona fide abolition of posts due to financial constraints (Paras 7-10).
B) Service Law - Reinstatement - Section 19 of Rajasthan Non-Government Educational Institutions Act, 1989 - Tribunal's order of reinstatement set aside as termination was due to abolition of posts and not a disciplinary action - The court held that reinstatement is not warranted when termination is due to abolition of posts (Paras 11-12).
Issue of Consideration
Whether termination of employees due to abolition of posts requires prior approval under Section 18 of the Rajasthan Non-Government Educational Institutions Act, 1989
Final Decision
Appeals allowed; impugned orders of Tribunal and High Court set aside; termination due to abolition of posts upheld
Law Points
- Abolition of posts does not attract Section 18 of the Rajasthan Non-Government Educational Institutions Act
- 1989
- Termination due to abolition of post is not a penal action requiring prior approval
- Management's decision to abolish posts due to financial losses is a bona fide administrative decision
Case Details
Civil Appeal No. 4806 of 2019 (Arising out of SLP (C) No. 11712 of 2017) and connected appeals
Shubhranshu Padhi for appellant, Padhmalakshmi Iyengar for respondent-State, Ramjee Pandey for private respondents
Director College Education, Government of Rajasthan & Ors.
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Nature of Litigation
Appeals against reinstatement orders of employees terminated due to abolition of posts
Remedy Sought
Setting aside of reinstatement orders and upholding termination due to abolition of posts
Filing Reason
Management challenged Tribunal and High Court orders directing reinstatement of employees
Previous Decisions
Tribunal ordered reinstatement; Single Judge dismissed writ petition; Division Bench dismissed appeal
Issues
Whether termination due to abolition of posts requires prior approval under Section 18 of the Act
Whether the management's decision to abolish posts due to financial losses was bona fide
Submissions/Arguments
Appellant: Section 18 not applicable as termination was due to abolition of posts, not disciplinary action; relied on Shri Maheshwari Senior Higher Secondary School v. Bhikha Ram Sharma
Respondents: Prior approval mandatory under Section 18; abolition of posts was not genuine
Ratio Decidendi
Termination of service due to abolition of posts does not attract Section 18 of the Rajasthan Non-Government Educational Institutions Act, 1989, as it is not a penal action requiring prior approval. The management's bona fide decision to abolish posts due to financial constraints is valid.
Judgment Excerpts
Section 18 of the Act would not be attracted as no penal action had been taken against the concerned employees, as the termination took place only as a result of the abolition of posts.
In case of termination of service of an employee due to abolition of post, the question of conducting the enquiry under the Rules does not arise.
Procedural History
Employees terminated on 29.07.2003 due to abolition of posts; they appealed to Tribunal under Section 19 of the Act; Tribunal ordered reinstatement on 07.12.2004; Management filed writ petitions; Single Judge dismissed on 18.07.2005; Division Bench dismissed on 15.12.2016; Management appealed to Supreme Court.
Acts & Sections
- Rajasthan Non-Government Educational Institutions Act, 1989: 18, 19
- Rajasthan Societies Registration Act, 1958:
