# MOHD RASHID AHMAD ETC v. STATE OF U.P. & ANR

- **Citation:** [1979] 2 S.C.R. 826
- **Court:** Supreme Court of India
- **Decided:** 1978-12-15
- **Case number:** Civil Appeal Nos. 1724/69 and 1732 of 1971
- **Bench:** R. S. Sarkaria, V. D. TuLZAPURKAR, A. P. Sen
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/mohd-rashid-ahmad-etc-v-state-of-u-p-anr-7643
- **Pages:** 20

## Headnote

lj.P. Nagar Mahapalika Adhiniyam, 1959-Act abolished
all
niunicipal
boards and other local authorities-Empowered State Government to constitute
Centralised Palika Ser1:ices prescribing method of recruitlnent and conditions
o; service of persons appointed to services-Rule 6-Scope of-Rule 6(2)(iv)
provided tlzar if no orders of final absorption passed before a certain date the
officer or seri,.ant concerned deemed to have been finally absorbed-Rule retrospectively amended from time to time on two occasions extending the date
of final absorption to rectify mistakres in dates-State Legislature, if had power
to confer power on State Government to amend rule retrospectively.
&le 6(2) (iii)-lf imposed a duty on State Government to act in a quasiD
iudicial mpnner. Rules of natural iustice-Applicability of.
E
F
G
H
The U.P. Nagar Mahapalika Adhiniyam 1959 as well as the U.P. Municipalities Act, 1916 empowered local bodies in the State to appoint their employees subject to certain regulatory control by the State Government.
Jn
1964 s. 112A was added to the 1959 Adbiniyam empowering the State Government to make rules for the creation of one or more service,s to be known
as Centralised Palika Services common to all the municipal corporations and
municipal boards and prescribe the method for recruitment and conditions of
service of persons appointed to any such service. Section 69B which was added
to the U.P. Municipalities Act, 1916 was in identical terms as s. 112A. Section
577(e) of the Adhiniyam provided for provisional absorption of officers and
servants of the erstwhile municipalities till they were finally absorbed in any
centralised services created under the Act.
By s. 577 ( ee) the Administrators
of Boards etc., were authorised to make temporary appointments of officers
and &ervants till substantive appointments, were made and such officers and
servants were treated as on deputation with the municipal corporations.
In exercise of the powers conferred under s. 112A the State Government
made the U.P. Palika (Centralised) Service Rules,
1966 which came
into
force on July 9, 1966.
Since r. 6 of the Rules was found to be contrary
to the provisions of s. 112A and s. 69B, the U.P. Local Self-Governtnent
(Amendment) Ordinance, 1966 (which later became an Act) was promulgated to
validate the 1966 Rules.1 Section 19 of the Act provided that the amendn1ents
made to the Rules might be given retrospective effect, limited to a
period
of one year from the commencement of the Ordinance. Thereafter the U. P.
Palika (Centralised) Services (Amendment) Rules, 1966 were passed by which
r. 6 was repealed and re-enacted with retrospective effect from July 9, 1966.
Clause (ii) of r. 6(2) empowered the State Government to pass a final order
of absorption in respect of particular officers and servants of the erstwhile
municipal boards if they were found suitable. Clause (iii) provided that such
orders had to be made on or before March 31, 1967.
/
{
•
'
•
• '
-~
•
RASHID AHMAD V. U.P.
827
Since the work of final absorption could not be completed by March 31,
A
1967, r. 6(2) (iii) was amended shifting the date to June 30, 1967.
But this
amendmeat having been made to come into effect from April 1, 1967 the legal
fiction created by cl. (iv) of r. 6 that if no orders of final absorption were
passed till ~1arch 31, 1967 the officer or servant concerned was to be deemed
to have been finally absorbed, came into play. Clause (ill) was,
therefore,
again amended shifting the date of passing the order from March 31, 1967 to
August 31, 1967.
The rule was made with retrospective effect from July 9,
B
1966 .
For the purpose of final absorption of all officers and servants who were
found suitable in the two categories viz., those appointed under s. 577{e)
ands. 577(ee) of the Adhiniyam, the State Government laid down a procedure.
It constituted Divisional Committees for making necessary recommendations to
the Stote Government.
On January 11, 1967 the State Government is

## Text

_Characters 0–39,958 of 53,645. This is a partial read: ask again with offset=39958 for what follows._

A
B
c
826
MOHD RASHID AHMAD ETC.
v.
STATE OF U.P. & ANR.
December 15, 1978
[R. S. SARKARIA, V. D. TuLZAPURKAR AND A. P. SEN, JJ.J
lj.P. Nagar Mahapalika Adhiniyam, 1959-Act abolished
all
niunicipal
boards and other local authorities-Empowered State Government to constitute
Centralised Palika Ser1:ices prescribing method of recruitlnent and conditions
o; service of persons appointed to services-Rule 6-Scope of-Rule 6(2)(iv)
provided tlzar if no orders of final absorption passed before a certain date the
officer or seri,.ant concerned deemed to have been finally absorbed-Rule retrospectively amended from time to time on two occasions extending the date
of final absorption to rectify mistakres in dates-State Legislature, if had power
to confer power on State Government to amend rule retrospectively.
&le 6(2) (iii)-lf imposed a duty on State Government to act in a quasiD
iudicial mpnner. Rules of natural iustice-Applicability of.
E
F
G
H
The U.P. Nagar Mahapalika Adhiniyam 1959 as well as the U.P. Municipalities Act, 1916 empowered local bodies in the State to appoint their employees subject to certain regulatory control by the State Government.
Jn
1964 s. 112A was added to the 1959 Adbiniyam empowering the State Government to make rules for the creation of one or more service,s to be known
as Centralised Palika Services common to all the municipal corporations and
municipal boards and prescribe the method for recruitment and conditions of
service of persons appointed to any such service. Section 69B which was added
to the U.P. Municipalities Act, 1916 was in identical terms as s. 112A. Section
577(e) of the Adhiniyam provided for provisional absorption of officers and
servants of the erstwhile municipalities till they were finally absorbed in any
centralised services created under the Act.
By s. 577 ( ee) the Administrators
of Boards etc., were authorised to make temporary appointments of officers
and &ervants till substantive appointments, were made and such officers and
servants were treated as on deputation with the municipal corporations.
In exercise of the powers conferred under s. 112A the State Government
made the U.P. Palika (Centralised) Service Rules,
1966 which came
into
force on July 9, 1966.
Since r. 6 of the Rules was found to be contrary
to the provisions of s. 112A and s. 69B, the U.P. Local Self-Governtnent
(Amendment) Ordinance, 1966 (which later became an Act) was promulgated to
validate the 1966 Rules.1 Section 19 of the Act provided that the amendn1ents
made to the Rules might be given retrospective effect, limited to a
period
of one year from the commencement of the Ordinance. Thereafter the U. P.
Palika (Centralised) Services (Amendment) Rules, 1966 were passed by which
r. 6 was repealed and re-enacted with retrospective effect from July 9, 1966.
Clause (ii) of r. 6(2) empowered the State Government to pass a final order
of absorption in respect of particular officers and servants of the erstwhile
municipal boards if they were found suitable. Clause (iii) provided that such
orders had to be made on or before March 31, 1967.
/
{
•
'
•
• '
-~
•
RASHID AHMAD V. U.P.
827
Since the work of final absorption could not be completed by March 31,
A
1967, r. 6(2) (iii) was amended shifting the date to June 30, 1967.
But this
amendmeat having been made to come into effect from April 1, 1967 the legal
fiction created by cl. (iv) of r. 6 that if no orders of final absorption were
passed till ~1arch 31, 1967 the officer or servant concerned was to be deemed
to have been finally absorbed, came into play. Clause (ill) was,
therefore,
again amended shifting the date of passing the order from March 31, 1967 to
August 31, 1967.
The rule was made with retrospective effect from July 9,
B
1966 .
For the purpose of final absorption of all officers and servants who were
found suitable in the two categories viz., those appointed under s. 577{e)
ands. 577(ee) of the Adhiniyam, the State Government laid down a procedure.
It constituted Divisional Committees for making necessary recommendations to
the Stote Government.
On January 11, 1967 the State Government issued the
C
first Circular stating that all officers and servants whose services were proposed
to b_e determined on the ground of unsuitability might be given an opportunity
of personal interview by the Divisional Committees.
The Government Jivided
the officers and servants into two categories, those getting salary above Rs.
500/- and those getting salary below Rs. 500/- and provided that cases of
each category were to be dealt with at different levels.
By this circu~ar
the
Government re-constituted the composition of the divisional Committees
so
D
far as the five municipal corporations which were created under the 1959
Adhiniyam v.·ere concerned and directed that these Divisional Committees
should make selections for all Centralised Services except those whoSe starting
salary \Vas Rs. 500/- and above.
The selection for this c:;;tegory was to be made
by the State Selection Committee.
With a view to secure a reasonable uniformity in the standards to be applied by the Divisional Committees in making the selection, the third Circular
dated February 23, 1967 provided that the Committees should interview the
official concerned to judge his suitability for absorption
in the
Centrahscd
Services and that if it was proposed to declare an official to be uJ1suitable
for absorption on the basis of adverse entries, the Divisional Com111ittees
should a:ffon;t an opportunity to the official concerned to appear before it and
clear up his position. It was further provided that only those adverse remarks
which were found to have been duly communicated to the official concerned
might be considered against him.
Thus the procedure laid down was this : The recommendations of the Divisional Committees in respect of persons drawing salary less than Rs. 500/ -
would be scrutinised by the State Government in the Local Self-Govennnent
Department and the necessary orders passed thereon while in respect of the
iecond category -officers drawing a salary above Rs. 500/- p.m. the Secretary
to the Government Local Self-Government Department would obtain the orders
of the Minister concerned in passing the final orders.
The appellant RA was a permanent Assistant Engineer in the Development
Board, Kanpur. Before the coming into force of the Adhiniyam he was appointed as officiating Executive Engineer and since then he continued to function
in that capacity on a purely temporary arrangement under s. 577(ee).
The
appe11ant AH was a Sanitary Inspector in the Municipal Board •. Kanpnr and
E
F
G
B
A
B
c
D
E
F
G
H
828
SUPREME COURT REPORTS
(1979] 2 S.C.R,
continued to hold that post.
He \Vas later promoted temporarily as Assistant
Engineer and he stood provisionally absorbed under s. 577(e).
\Vrit Petitions filed by the appellants and others challenging the vires of
the Rules were dismissed by the High Court.
On· appeal to this Court it was contended that the appellants must be
deemed to have been absorbed on March 31, 1967 by virtue· of the fiction contained i!'l cl. (iv) of r. 6(2), as originally enacted, because the a111endment
made to the Rule shifting the date of final absorption first from J\.farch 31,
1967 to June 30, 1967 and subsequently to August 31, 1967 were legally
ineffective and (2) that the impugned orders were vitiated on account of the
failure of the State Government to afford to the appellants an opportunity
of being heard.
HELD : I. (a) The validity of the two amendments made by the State
Governrnent in r. 6(2) cannot be questioned. Although a rule cannot be made
with retrospective effect, the Legislature by enacting s. 19 of the U.P. Local
Self Government (Amendment) Act, 1966 expressly conferred powers on the
State Government to make retrospective rules. [837 DJ.
(b) It is well established that retrospective operation is not to be given
to a statute so as to impain tht existing right or obligation other than as
regards matter o.f procedure. If the enactment is expressed in a language which
is fairly capable of either interpretation, it ought to be construed :is prospective
only.
But where it is expressly stated that an enactment shall be retrospective,
courts will give it such operation.
It is competent for the Legislature by
retrospective legislation to make the provision contained in an earlier enactment ineffective. [838 F-GJ
QIJinn v. Prairiedate [1958] 25 WWR 241; referred to.
( c) In considering the effect of repeal of an enactment followed by reenactment in the light of s. 6 of the General Clauses Act, 1897 the line of
enquiry \vould be not \Vhether the new Act expressly keeps alive old rights
and liabilities, but whether it manifests an intention to destroy them.
Aay
incon1pa1ibility in the provision has to be ascertained from a consideration
of all the relevant provisions of the new law and the mere absence of a
saving clause is by itself not conclusive. [839 B-C]
In the instant case by the introduction of the· new fictional date of absorption as August 31, 1967 there was a clear intention to destroy the earlier
fictional date of March 31, 1967.
It would clearly be incompatible, on consideration of subsequent amendments for both the provisions i.e. the original
clause (iii) fixing March 31, 1967 and the new clause (iii) fixing 1\ugust 31,
1967 to operate simultaneously. The effect of introduction of the nev.· fictional
date was to annihilate the earlier fictional
date.
The appellants, therefore,
di~ not stand automatically absorbed by the failure of the State Government
to pass the necessary orders by March 31, 1967, as its powers stood extended
by the subsequent amendn1ent to August 31, 1967.
Before that date expired
the State Government, in both cases, passed the necessary orders terminating
the services of the appellants as they were
not found
fit
for absorption.
[839 D-F].
.. •
)
•
RASHID AHMAD v. U.P.
829
2.
(a) The entrustment to the State Government of the work of determining
the suitability or otherwise of officers and servants of the erstwhile Municipal
Boards and other local authorities for absorption in the newly created Centralised Services under s. 112A, imposed a corresponding duty or obligation
on the Government to hear the officers and servants concerned.
All such
officers were, therefore, entitled to be heard in the matter of final absorption
irrespective of their salary. [841 A; 843 FJ.
(b) By virtue of the repealing provision contained in s.
581
of the
Adhiniyam, 1959 the various Municipal Boards and
other
local authorities
constituted under the relevant Acts ceased to exist as a result of which
the existing posts held by the officers and servants in these bodies stood
abolished.
Consequent upon the abolition of the posts, all the officers and
servants of the erstwhile local bodies lost their right to hold their posts. The
Adhiniyam, however, provided by s. 577(e) and (ee) for provisional absorp·
tion or ten1porary appointment of these officers and servants till substantive
appointments were made and these officers and servants were treated as on
deputation with the Municipal Corporations. Therefore, in the very nature of
things the officers and servants provisionally absorbed under these sections
could not be auton1atically obsorbed in the ntwly created Centralised Servi.:c:s.
1here had to be screening of all of them for determining their suitability for
final absorption in the Centralised Services. [840 A; B·F]
( c) The very nature of the functions entrusted to . the State ·Governn1ent
under ,r. 6(2) (iii) of the Rules implies a duty to act in a quasi·judicial
manner.
Unless the State Government's orders conformed to the rules of
natural justice, the orders were liable to be struck down as invalid. [840 G 841 B].
(d) It is not correct to say that it is incumbent only on the Divisional
Committees to give an opportunity of personal hearing and that the State
Government was absolved of the duty to hear in respect of officers drawing
Rs. 500/- and above.
The first Circular dated January 11. 1967 was all
pervasive and the Government's policy was made quite clear in it.
The
second Circular dated January 31, 1967 was equally subject to the Government policy.
All the officers and servants of the erstwhile Muncipal Boards
and other local authorities were, therefore, entitled to be heard in the matter
of final absorption irre·spective of their salary. [843 E, A, D].
In the case of ... A..H on an overall view of the records it cannot be said
that the Divisional Con1mittee was wrong in recommending to the Government
A
B
c
D
E
F
to tern1inate his services. The Government was within its right in passing the
G
impugned ordtr of termination in regard to him. [844 C]
In regard to RA before passing the impugned order of temination of services, the Minister for Local Self·Government did not give him an opportunity
of a hearing. The procedure laid do\vn in the Centralised Services Rules was
not followed.
The State Government could decide on the question of his
absorption only after he was found fit but that has not been done.
The
H
order passed by the State Gove1nment, therefore, suffers from a serious legal
infirmity. [844 D-F].
830
SUPREME COURT REPORTS
(1979] 2 S.C.R.
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 1724/69 and
1732 of 1971.
Appeals by Special Leave from the Judgment and Order dated
12-5-69 of the Allahabad Ifigh Court in Special Appeal Nos.492 and
437 of 1968.
B
Naunlt Lal and Faqir Chand for the Appellant in CA Nos. 1724/
c
69.
G. N. Dikshit, 0. P. Rana for Respondent No.I in C.A. 1724/69
J. P. Goyal, S. M. Jain and S. K. lain for Respondent No.2 in CA
Nos. 1724/69
Miss Meera Bali for the Appellant in C.A. 1732/71
G. N. Dikshit and O.P. Rana for the Respondents in CA 1732/71
The Judgment of the Court was delivered by
SEN J. These two appeals by special leave, directed against the
D
judgment of the Allahabad Ifigh Court dated May 12,
1969 raise
common questions and therefore, are disposed of by this common judgment.
By separate notifications issued under section 3 of the U.P. Mahapalika Adhiniyam, 1959, the State Government constituted Municipal
E
Corporations In five cities in the State, namely Kanpur, Agra, Varanasi,
Allahabad and Lucknow w.e.f. February 1, 1960.
r
G
H
The appellant in the present appeal, Mohd. Rashid Ahmad was a
permanent As~istant Engineer in the Development Board, Kanpur,
constituted under the Cawnpore Urban Area Development Act, 1945.
In 1953, an Administrator was appointed of both the Development
Board and the Municipal Board, Kanpur, constituted under the U.P.
Municipalities Act, 1916, under the U.P. Local Bodies (Appointment of
Administrators) Act, 1953. The two local bodies, however, continued
to have separate legal existence and their officers and servants continued as the employees of the respective bodies.
The appellant Mohd.
Rashid Ahmad was appointed as Offg.
Executive Engineer by the
Administrator of the Municipal Corporation, Kanpur, for a period of
one year on September 12, 1960.
He has since then continued to
function in the same capacity, on a purely temporary
arrangement
under s.577 ( ee), that is, for so long as no substantive appointment
could be made to that post under s.106.
The Uttar Pradesh Public
Service Commission, however,
considered that he was not fit for
appointment for the post of the Executive Engineer, Municipal Corporation, Kanpur.
.. •
•
•
I
RASHID AHMAD v. U.P. (Sen, J.)
831
The appellant irt the connected appeal, Ashfaq Hussain was a permanent Sanitary Inspector in the Municipal Board, Kanpur.
After the
constitution of the Municipal Corporation, Kanpur, he continued to
hold that post under s. 577(e).
On July 24, 1967 he was transferred
in the same capacity to the Municipal Corporation, Allahabad, where
he was promoted temporarily as an Assistant Engineer.
He, therefore,
stood provisionally absorbed under s.577 ( e) .
Both the U.P. Nagar Mahapalika Adhiniyam, 1959, and the U.P.
Municip::lities Act, 1916 empowered these local bodies to appoint their
employees subject to certain regulatory control by the State Government. By s. 12 of the U.P. Nagar Mahapalika (Sanshodhan)
Adhiniyam, 1964, the State Legislature added s. 112A to the U.P. NagarMahapalika Adhiniyam, 1959. Similarly, by s.37 of the U.P. Municipalities (Amendment)· Act,
1964, s.698 was added to the U.P.
Municipalities Act, 1916, which was identical in terms to s.112A.
Section 112A of the Adhiniyam empowered the State Government to
provide by rules for the creation of one or more services to be known
as Centralised Palika Services, as it may deem fit and proper, common
to all the Municipal Corporations and Municipal Boards, and prescribe
the method for
recruitment and conditions of service of persons
appointed to any such service.
A
B
c
D
Section 112A of the U.P. Nagar Mahapalika Adhiniyam, 1959,
E
ena-Cts
"112A. Centralization of services.-(1) Notwithstanding anything contained in section 106 to 110, the State Gov-
. emment may at any time by rules provide for the creation
of one or more services of such officers and servants as the
State Government may deem fit, common to the Mahapalikas
or to the Mahapalikas and Municipal Boards, of the State,
and prescribe .the method of recruitment and conditions of
service of persons appointed to any such service.
(2) When any such service is created, officers and servants serving on the posts included in the service, as well as
officers and servants performing the duties and functions of
those posts under sub-clause ( 1) of clause ( ee) of section
577 may, if found suitable, be absorbed in the service, pr<>-
visionally or finally, and the services of others shall stand
determined, in the prescribed manner.
( 3) Without prejudice to the generality of the provisions
of sub-sections (1) and (2), such rules may also provide for
F
G
H
A
B
c
D
E
F
G
832
SUPREME COURT REPORTS
[1979] 2 s.c.R.
consnltation with the State Public Service Commission in respect of any of the matters referred to in the said sub-sections."
The State Govermnent in exercise of the powers conferred by section 112A of the U.P. Nagar Mahapalika Adhiniyam, 1959 and s.69B
of the U.P. Municipalities Act, 1916, made the U.P. Palika (Centralised) Services Rules, 1966, which came into force on July 9, 1966.
Rule 3 created 19 Palika (Centralised) Services, covering 76 posts,
common to all the Municipal Corporations and Municipal Boards. The
rules provided for regulating the recruitment and conditions of service
of the persons appointed to these newly created services.
Rule 6
dealt with recruitment to the Centralised Palika Services. Due to
inadvertence r.6 was not drafted in conformity with the requirements
of s.112A and s.69B.
That was because cl.(l) provided for automatic
final absorption of officers and servants provisionally absorbed
under
s.5_77(e), contrary to the provisions of s.112A of the Adhiniyam and
s.69B of the Municipalities Act.
On September 5, 1966, the Governor promulgated the U.P. Local
Self-Government (Amendment) Ordinance,, 1966, which was replaced
by the U.P. Local Self-Government Laws (Amendment) Act J 966.
Section 19 of the Act reads as follows:
"19. Deeming, validation, etc.
The U ttar Pradesh
Palika (Centralised Services Rules, 1966, shall be deemed to
have been made under the provisions of the. Uttar Pradesh
Nagar Mahapalika Adhiniyam, 1959, and the U.P. Municipalities Act, 1916, as if the a!llendments made by this Act to
the said Acts were always in force and be deemed to be and
always to have been valid and shall, subject to any amendments made thereto, continue in force, and notwithstanding
anything contained in the said Acts, the power to make
amendments to the said rules may, during th'e period ending
on September 4, 1967, be exercised retrospectively."
It, in effect, amended section 112A of the Adhiniyam and s.69B
of the Municipalities Act.
Section 4 of the Act provided that the U.P.
Palika (Centralised) Services Rules, 1966 shall be deemed to be valid.
The Act further provided that the amendments made to the rules may
H
be given retrospective effect. The power of making retrospective rules
was, however, limited to a period of one year from the commencement
of the ordinance.
/
• '
•
..
•
\
•
•
}
RASHID AHMAD v. U.P. (Sen, !.)
833
On October 10, 1966, the State Government passed the U.P. Palika
(Centralised) Services (Amendment) Rules, 1966. These rules repealed and re-enacted r.6 with retrospective effect from July 9, 1966.
Under cl. (ii) of r.6(2) the State Government had to pass a final order
of absorption, in respect of particular officers and servants of the erstwhile Municipal Boards, if they were found suitable, in accordance with'
s.112A of the Adhiniyam.
Clause (iii) provided that such orders had
to be made on or before March 31, 1967. By cl.(iv) if no orders
of final absorption were passed till then, the officer or servant concerned
was to be deemed to have been finally absorbed.
The State Government was, however, constrained to make the U.P. Palika (Centralised)
Services (Amendment) Rules, 1967 on March 30, 1967 and amend cl.
(iii) of r.6(2), as the work of final absorption could not be completed
by March 31, 1967. The date of passing the necessary orders in that
behalf was sought to be shifted to June 30, 1967.
A new cl. (iii) was
accordingly substituted by this amendment effected on March, 30,
1967. But, unfortunately the amendment was made to come into effect
from April 1, 1967. This created a serious legal infirmity, as on the
expiry of March, 31 1967, the legal fiction embodied in cl. (iv) was
brought into play.
Thereafter, the State Government made the last amendment to the
U.P. Palika (Centralised) Services (Amendment) Rules, 1967
on
June 26, 1967, in supersession of the U.P. Palika (Centralised) Services (Amendment) Ruies, 1967 made on March 30, 1967.
This
' '\..... amendment introduced a new cl.(iii) to r.6(2), in place of the existing
- cl.(iii) of U.P. Pa!ika (Centralised) Services Rules, 1966, by which
the date of passing the order was shifted from March 31, 1967 to
August 31, 1967, with retrospective effect from July 9, 1966.
Having provided for the creation of Centralised Palika Services, the
State Government had, in the meanwhile, laid down the procedure by
which an office or servant provisionally absorbed under s. 577 ( e) of
temporarily appointed under s.577(ee), were to be finally absorbed, if
found suitable, under s.112A. By its three circulars dated January
11, 1967; January 31, 1967 and February 23, 1967, addressed to the
Divisional Commissioners, it intimated the constitution of Divisional
Committees for making necessary recommendations to the State Government in this behalf.
The first circular embodied the Government
policy in these terms:
"Government desire. that all officers and servants, whose
services are proposed to be determined on grounds of unsnitaA
B
c
D
E
F
G
H
83 4
SUPREME COURT REPORTS
[1979] 2 s.c.1.
A
bility may be given an opportunity of personal interview by
the Committee."
8
c
D
E
F
F
After such interviews, the Committees were to finalise their recommenda!!ons and furnish the same to the Government. In view of
the limited time available to the Government, for finalising action in
the matter, it was desired that the first meeting of the Committees
should be held in the last week of January or in the first week of
February, 1967.
The Divisional Commissioner were required to
intimate the date to the Secretary to the Government, Local Self-GG>vemment Department, so that all necessary arrangements could be made
to forward the character rolls and service records of the Centralised
Services officers and servants.
By the second circular, the State Government re-constitnted the
Committees, so far as the five Mnnicipal Corporations were concerned,
and directed that these Divisional Co=ittees were to make selections
for all C";entrali:sed Services except those whose starting salary
was
Rs. 500 /- and above.
Selection for the posts in the latter category
were to be made by the State Selection Committee. Thus, the Government divided the officers J!cnd servants into two categories, and their
cases were to be dealt with at two different levels for purposes of final
absorption under r.6(2)(iii) read with s.112A.
By its third circular, the State Government without disturbing the
earlier categorisation of officers and servants into two classes, laid down
/
certain broad criteria with a view to secure a reasonable uniformity in -
the standards to be applied by the Divisional Committees in making the
selection. It may, however, be observed that the Government reiterated its declared policy that all such officers and servants, whose services
were proposed to be determined on the ground of unsuitability be given
· an opportunity of personal interview by the Committees stating:
" .. the committee should interview the official concerned
to judge his suitability or otherwise for absorption in the
centralised services.
... When it is proposed to declare an official to be unsuitable for absorption on the basis of adverse entries, the divisional co=ittee should afford an oppof!unity to the official
concerned to appear before it and clear up his position."
G
It was also desired that only those adverse remarks may be considered against the official concerned, which were found to have been
duly co=unicated to him.
•
• '
•
..
• •
•
,
•
•
RASHID AHMAD v, U.P. (Sen, J.)
83 5
It must at ouce be stated that though the State Government had by
its circular dated January 31, 1967 eJ!trusted the task of determining
the suitability or otherwise of officers and servants holding Centralised
Services posts drawiDi') less than Rs. 500/-, to Divisional Committees,
and reserved such fnnction in respect of officers and servants drawing
Rs. 500 /- or more, to the State Selection Committee, and by its subsequent circular dated February 23, 1967 maintained the classification
of such officers and servants for purposes of judging their suitability for
absorption in the Centralised Palika Services, the final orders of absorption in each case under s.112A were passed by the State Government.
In the former class, the recommendations of Divisional Committees
were scrutinised by the State Government in the Local Self-Government Department, in the light of the service records of the officials
concerned, and the necessary orders thereon were passed. In respect
of the latter category, the Secretary to the Government, Local SelfGovernment Department prepared a note and put it up for the Minister
for passing the final orders.
It is also worthy of mention that the delay in completing the work
of final absorption by the State Government was mainly due to three
factors, namely; (1) due to shortness of the time available at its disposal, (2) the number of officers and servants holding the Centralised
Services posts under s.577(e) and (ee) was quite large,
and (3)
because of delay on the part of the erstwhile Mnnicipal Boards to forward the character rolls and service records of the officers and servants
concerned.
On account of this, the task of absorpti011 under s.l 12A
could not be completed before March 31, 1967 i.e., the date originally
fixed by cl. (iii) of r.6(2) of the U.P. Palika (Centralised)
Services
Rules 1966. The period was, therefore, subsequently extended from
Mqrch 31, 1967 to !une 30, 1967, and thereafter from March 31,
1967 to August 31, 1967.
Eventually, the State Government in exercise of its powers under
cl.(iii) of r.6(2) of the U.P. Palika
(Centralised) Services Rules,
1966 determined the services of the appellant Mohd. Rashid Ahmad
A
B
c
D
F
on July 18, 1967 and that of Ashfaq Hussain on August 27, 1967, on
G
the ground that they were not found fit for absorption under s.112A of
the Adhiniyam.
The two appellants and several other employees of the erstwhile
Municipal Boards and District Boards challenged the validity of the
various orders passed by the State Government terminating their scrB
vices before the Allahabad High Court on several grounds.
Amongst
others, they challenged the validity of r.6(2) (iii), framed under s. 112A
A
B
c
836
SUPREME COURT REPORTS
(1979] 2 S.C.R
of the Adhiniyam, on the ground that it was ultra vires the State Government as it brings about e,xtinction of the relationship of employer
and employees between them and the erstwhile Municipal Boards. It
was also urged that the impugned orders were violative of Articles 14
and 16 of the Constitution because the classification made by the State
Government by its circular dated January 31, 1967 entrusting the task
of determination of the suitability or otherwise of officers and servants
holding Centralised Services posts drawing less than Rs. 500/- to
Divisional Committees, which were enjoined to give them the right of
a personal hearing to have their say in the matter of final absorption,
and entrusting of such function in respect of officers and servants drawing Rs. 500/- and above to the State Selection Committee without
a
corresponding right of hearing, was without any rational basis.
It was
also urged that the impugned orders were vitiated being in breach of
the rules of natural justice.
A Division Bench of the Allahabad High
Court, however, rejected all these contentions.
D
In view of the language of Entry 5, List II of the Seventh Schedule,
E
F
G
H
the objection regarding the validity of r.6(2)(iii) was rightly not pressed before us.
On the view that we take of the various circulars issued
l!Jy the State Government laying down the procedure for dealing with
the question of suitability or otherwise of officers and servants of
the
erstwhile Municipal Boards for absorption in the Centralised Services
under r.6(2) (iii) the contention based on Articles 14 and 16 of the
Constitution also does not arise.
Learned counsel appearing for the appellants assailed the impugned
orders of the State Government on two grounds, namely:
1. By reason of the legal fiction contained in cl.(iii) of
r.6(2), the services of the appellants stood finally absorbed in
the U.P. PaHka Centralised Services on March 31, 1967 due
to the failure of the State Government to pass the necessary
orders in that behalf before that date.
Under the legal
fiction contained in
cl. (Iv) thereof, and the
subsequent
amendment made by the U.P. Palika (Centralised) Services
(Amendment) Rules, 1967 which came into force on April 1,,
1967, the vested rights acquired by them to hold their respective posts could not be affected to their detriment; and
2. The orders of termination of services passed by the
State Government were vitiated due to it's failure to give to
the. appellants an opportunity of hearing.
• '
•
...
/;
•.
•
.
•
Ill •
' I
•
iii
...
I
..,
• '
•
,
•
-.\
>-
'
RASHID AHMAD v. U.P. (Sen, !.)
83 7
With respect to the first contention i! is urged that the appellants
stood provisionally absorbed under s. 577{e) read with cl(i) of r.6(2).
It is said that they would be deemed to have been finally absorbed on
March 31, 1967, if no orders contemplated by cl.(ii) thereof were
made with respect to them on or before that date.
Tue argnment
is
that the two subsequent amendments made on March 30, 1967 and
June 26, 1967, by which the State Government purported to shift the
date first from March 31, 1967 to June 30, 1967 and then from March
31, 1967 to August 31, 1967, were legally ineffective, as the first
amendment made to cl.(iii) of r.6(2) came into force on April
1,
1967 by which date the appellants already stood finally absorbed.
There was, therefore, no power i!! the State Government to re-open
the question of final absorption under s. 112A(2) of the Adhiniyam.
There is a fallacy in the argument.
The validity of the two amendments made by the State Government in r.6(2) from time to time
cannot be questioned.
While it is true that a rule cannot be made
with retrospective effect, the legislature by enacting s.19 of the U.P.
Local Self-Government (Amendment) Act, 1966, expressly conferred
powers on the State Government to make retrospective rules.
Indeed, the validity of the amendments was not questioned before us.
Even if the first amendment of March 30, 1967 was ineffective
because it was brought into force from April 1, 1967, the second
\'- amendment of June 26, 1967, which introduced a new clause (iii) to
r.6(2) with retrospective effect from July 9, 1966, was fully effective.
It shifted the date for passing of the order of final absorption from
March 31, 1967 to August 31, 1967.
Till the expiry of the date now
fixed, i.e. Angus! 31, 1967, the legal fiction contained in cl. (iv) of
r.6(2) would not be brought into play.
That is the inevitable legal
consequence of the subsequent amendment made on June 26, 1967 .
It would be clear .that cl. (iii) of r. 6(2), as amended on October 10,
1966, gave power to the State Government to pass an order of absorption under s. 112A of the Adhiniyam, of an officer or servant of the
Municipal Corporations provisionally absorbed under s. 577 ( e) if fonnd
suitable, on or before March 31, 1967.
If there was a failure on the
part of the State Government to pass such an order in respect of a particular officer or servant by that date, it would, unless there was a provision to the contrary, bring into play the legal fiction contained therein,
and he would, by its force, be deemed to be finally absorbed in the post
held by him.
I 5-40SCI /79
A
B
c
D
E
G
ff
' '
A
B
838
SUPREME COURT REPORTS
[19791 2 s.c.K.
The State Government in their return have candidly stated that due
to inadvertence, the subsequent amendment effected on March
30.
1967, wa·s made to take effect on April 1, 1967, by which date the legal
fiction under cl. (iv) had already taken effect.
It, therefore, became
necessary to correct the serious legal infirmity.
It was for that reason
that the subsequent amendment was made on June 26, 1967 by which
a new cl. (iii) was substituted in place of the existing cl. (iii) to r.6(2).
The amendment substituted new cl. (iii) tor. 6(2) with effect from July
9, 1966 i.e., from the very inception.
It was legitimately within the powers of the State Government to
c
give to the amended rule a retrospective effect.
As a re'sult of
the
amendment, the original cl. (iii) was substituted by a new cl. (iii) by
which the date for passing an order of absorption by the State Government was shifted to August 31, 1967, which again introduced another
legal fiction.
It provided that if there was a failure on the part of the
State Government to pass an order of absorp•ion by August 31, 1967,
D
the officer or servant concerned shall be deemed to be finally absorbed.
This legal fiction was brought into force with effect from July 9, 1966.
It is needless for us to stress that both the legal fictions, onu created
by the original cl. (iii) fixing the fictional date of absorption as March 31,
1967 and the subsequent legal fiction providing for the fictional date of
E
absorption as August 31, 1967, could not co-exist.
With the subsequent amendment effected on June 26, 1967, the earlier legal fiction ,,r
was never brought into play, a's by reason of the amendment, the State ·
Government had the power to pass the necessary orders till August 31,
F
G
H
1967.
The introduction of the second fictional date i.e., August 31,
i
1967, was to "eclipse" the earlier fictional date of absorption.
Perhaps no rule of construction is more firmly e.stablished
than
this-that retrospective operation is not to be given to a statute so as to
impair an existing right or obligation other than as regards the matter
of procedure, unless that effect cannot be avoided without doing violence
to the language of the enac•ment.
If the enactment is expressed in a
language which is fairly capable of either interpretation, it ought to be
construed as prospective only.
But where, as here, it is
expressly
stated that an enactment shall be retrospective, the courts will give
it
such an operation.
It is obviously competent for the legislature, in its
wisdom, to make the provisions of an Act of Parliament retrospective ..
That is precisely the case here.
In Quinn v. Prairiedale(') where a
subsequent enactment provided that the relevant section 'should be
(I) [1958] 25 W.L.R. 241.
•
i
•'
'·· ,,
I
l
I
•
•
I
•
•
RASHID AHMAD v. U.P. (Sen, I.)
839
deemed never to have been contained in the earlier statute, it was held
A
to be sufficient to rebut the presumption against retrospectivity. (')
In State of Punjab v. Mohar Singh(') and in lnder Sohan Lal v.
Custodian of Evacuee Property Delhi & Ors.(') this Court had to
consider the effect of repeal of an enactment followed by re-enactment in
the light of s. 6 of the General Clauses Act, 1897. The line of enquiry,
B
as observed in Mohar Singh's case, would be not whether the new
Act expressly keeps alive old rights and liabilities, but whether it
'manifests an intention to destroy them'.
It was held that s. 6 of the
General Clauses Act was not entirely ruled out when there was a repeal
of the enactment followed by a fresh legislation un:ess the new legislation manifested an intention to the contrary. Such incompatibiUy tad
C
to be ascertained from a consid:eration of all the relevant provisions of
the new law and the mere absence of a saving clause was, by itself, not
conclusive.
In the present case, however,, there can be no doubt that by the introduction of the new fictional date of absorption as August 31, 1967,
there was a clear intention to destroy the earlier fictional date of March
31, 1967. Itwould clearly be incompatible, on consideration of subsequent amendment, for both the provi'sions, i.e., the original cl.
(iii)
fixing March 31, 1967 and the new cl. (iii) fixing August 31, 1967 to be
the fictional date, to operate simultaneously.
The effect of introduction of the new fictional date was to annihilate the earlier fictional date.
The appellants, therefore, did not stand automatically absorbed by the
failure of the State Government to pass the necessary orders by March
31, 1967, as its powers stood extended by the subsequent amendment
to August 31, 1967.
Before that date expired, the State Government
in both these cases, passed the necessary orders terminating the services
of the appellants as they were not found fit for absorption under s. l 12A
( 2) of the Act.
The first contention, therefore, fails.
That takes -us to the second contention, namely, whether the impugned orders are vitiated on account of the failure of the State Government to afford to the appellants an opportunity of a hearing.
With the establishment of Municipal Corporations in five cities in
the State, namely, Kanpur, Agra,, Varanasi, Allahabad and
Lucknow,
w.e.f. February 1,_ 1960, the Municipal Boards, Improvement Trusts,
Development Boards etc. in these cities,
ceased to exist with the
(1) Craie!I on Statute Law, 6th Ed., p. 390, and Maxwell on the Interpretation of
Statutes, 12th Ed., p. 216.
(2) [1955) 1 S.C.R. 893
[1955) 2 S.C.R. 1117
()
E
F
G
H
...
A
B
c
D
840
SUPREME COURT REPORTS
[1979] 2 s.c.R.
repeal, by s.581 of the U.P. Nagar Mahapalika Adhiniyam, 1959, of
the U.P. Municipalities Act, 1916, the U.P. Town Improvement Act,
1919, the U.P. District Boards Act, 1922, the Cawnpore Urban Area
Development Act 1945, the U.P. Local Bodies (iAppointment of Administral!or) Act 1953, with effect from that date, in relation to these
cities.
In consequence thereof, the existing posts held by the .officers
and servants of these bodies stood abolished.
Consequent upon the
abolition of the posts, all officers and servants of the erstwhile local
bodies lost their right to hold their posts.
The Adhiniyam, however, provided by s.577(e), notwithstanding
anything contained in ss.106 and 107, for the provisional ~bsorption
of these officers and servants in the Municipal Corporations, till they
were finally absorbed in any Centralised Services created by rules made
under s.