Rajasthan High Court - Jodhpur

Dalam Chand And Ors vs State And Ors on 10 July, 2025

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HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
D.B. Civil Writ Petition No. 1268/2003

1. Dalam Chand, aged about 47 years, son of Shri Arjun Lal,
resident of Near Khem Ka Sati Mandir, Ward No.24, Churu.

2. Satya Narain, son of Shri Asha Ram resident of near
Khemka Sati Mandir, Ward No.24, Churu.

3. Chagan Lal Sharma, son of Shri Hari Ram Sharma,
resident of Vadia Bas, Churu.

4. Ghasi Ram, son of Shri Sukha Ram, resident of Primary
Health Centre, Khasoli, District Churu.

5. Peeru Khan, son of Shri Fateh Khan, resident of Ahuna
Mohalla, Ward No.28, Churu.

6. Hari Ram, son of Shri Rameshwar Lal, resident of Kujro Ka
Mohalla, Churu.

7. Bhanwar Lal, son of Shri Durga Dutt, resident of Harijano
Ka Mohalla, Churu.

8. Mustaq Khan, son of Shri Peeru Khan, resident of Railway
Colony, Ratangarh, District Churu.

9. Satya Narain, son of Shri Bhagirath Prasad, resident of
Churu.

10. Omprakash Prajapat, son of Shri Mala Ram, resident of
behind Gayatri Mandir, Churu.

11. Keshar Dev, son of Shri Radhey Shyam, resident of
Nursery Training Centre, Churu.

12. Bal Kishan, son of Shri Lal Sharma, resident of Bhartiya
Hospital, Churu.

13. Mohan Lal, son of Shri Sohan Lal, resident of Om Colony,
Churu.

----Petitioners

Versus

1. The State of Rajasthan, through the Secretary, Medical and
Health Department, Government of Rajasthan, Jaipur.

2. Chief Medical and Health Officer, Ratangarh, District Churu.

----Respondents

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For Petitioner(s) : Mr. M.S. Singhvi, Sr. Advocate
assisted by Mr. Akhilesh Rajpurohit,
Mr. K.S. Chouhan,
Mr. Hardik Vyas and
Mr. Saurabh Rajpurohit, Advocates
For Respondent(s) : Mr. N.S. Rajpurohit, AAG assisted by
Ms. Anita Rajpurohit and
Mr. Sher Singh Rathore, Advocates

HON'BLE MR. JUSTICE SHREE CHANDRASHEKHAR
HON'BLE MR. JUSTICE SANDEEP SHAH

Judgment

Reserved on : 03/07/2025
Pronounced on : 10/07/2025

Per, S. Chandrashekhar, J :-

In this writ petition, thirteen retrenched employees of the

Rajasthan Small Industries Corporation who were appointed in the

Government Department on contract basis are seeking the

benefits of revised pay scales under the Rajasthan Civil Services

(Revised Pay Scales) Rules, 1998 and other service-linked

benefits. For claiming such benefits, they have challenged the

conditions under clause 7 and clause 10 under the Circular dated

24th December 1994 on the ground that such conditions are in

breach of Article 14 of the Constitution of India. The petitioners

have prayed that :-

"i by an appropriate writ, order or direction, the respondents may
be directed to pay increments to the petitioners from the date of
their appointment with all consequential benefits.
ii by an appropriate writ, order or direction, the respondents may be
directed revise the pay scale of the petitioners under the provisions
of Rajasthan Civil Services (Revised Pay Scale) Rules, 1998 with all
consequential benefits.
iii By an appropriate writ, order or direction, the Rule 2(ii)(c) of the
Rajasthan Civil Services (Revised Pay Scales) Rules, 1998 and

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Clause 7 and 10 of the circular dated 24.12.1994 (Annex.1) be
declared illegal and be struck down and it may be declared that
employees appointed on contract basis are entitled to get benefit of
revision of pay scales and other benefits of as are admissible to
regular government employees with all consequential benefits.
iv By an appropriate writ, order or direction, the respondents may
be directed to grant benefit of GPF and State Insurance to the
petitioners.
v by an appropriate writ, order or direction, the undertaking
obtained by the respondents be declared unconscionable as being
opposed to public policy.
vi Any other appropriate writ, order or direction which may be
considered just and proper in the facts and circumstances of the
present case, may kindly be passed in favour of the petitioners.
vii Costs of the writ petition may kindly be awarded to the

petitioner."

2. The petitioners were employed under the Rajasthan Small

Industries Corporation as Machine Operators and posted at the

unit of the Corporation at Churu. They were confirmed in service

on different dates between 05th February 1976 (Dalam Chand

Soni) to 01st April 1983 (Keshar Dev Saini and Bal Kishan

Sharma). Other petitioners were confirmed in service in the year

1977, except Mohan Lal Soni who was confirmed in service with

effect from 29th September 1980. In course of time, the

Corporation's unit at Churu suffered the order of closure of the mill

and the petitioners were retrenched from service on

30th November 1994. Soon thereafter, the guidelines for

engagement of the retrenched employees of Public Sector

Undertakings on contract were issued on 24 th December 1994 by

the Department of Personnel, Government of Rajasthan. Such

guidelines were issued by the Government of Rajasthan pursuant

to the decision of the State Bureau of Public Enterprises

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Department that the retrenched employees of Public Sector

Undertakings may be engaged as far as possible in State

Government Departments on contract basis. In pursuance thereof,

the petitioners were appointed on contract basis under Health

Department in the district of Churu by an Office Order dated

22nd April 1995 issued under the signature of the Chief Medical

and Health Officer at Ratangarh, Churu and were posted at

different places as indicated in the Office Order dated 28 th April

1995. The petitioners have produced a copy of the Office Order

dated 26th May 1995 which reveals that Jagdish Prasad Deora,

Satya Narain Soni, Dalamchand Soni and Chagan Lal Sharma were

granted pay scale of Rs.730-1250/- and the pay of other

petitioners was fixed in the pay scale of Rs.700-865/-. By the

Office Order dated 26th May 1995, petitioners were provided the

following emoluments :-

"Government of Rajasthan
Office of the Chief Medical and Health Officer
Ratangarh, (District Churu)
S.No. RJ/95/1339 Dated-26.05.1995

ORDER

Vide this Office Order No. RJ/Niyu/95/1057 dated 22.04.95 and No.1098 dated 28.04.95 the following persons have been appointed against the post of Class IV employees in this Department, approval is given to withdrawal of their salary from the date of their appointment in the following pay scale:-

S.No. Name of Place of Posting Pay Scale Basic Pay Employees

1. Shri Jagdish Prasad Primary Health 730-1250 880 + other Deora Center Jaitsisar allowances approved by the State Government

2. Shri Satya Narain Primary Health 730-1250 880 + other Soni Center Dadrewa allowances approved by the State Government

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3. Shri Dalamchand Primary Health 730-1250 880 + other Soni CenterJodi allowances approved by the State Government

4. Shri Chagan Lal Primary Health 730-1250 880 + other Center Punrasar allowances approved by the State Government

5. Shri Ghasi Ram Primary Health 700-865 810 + other Sharma Center allowances Gopalpura approved by the State Government

6. Shri Peeru Khan Primary Health 700-865 780 + other Center Baghera allowances approved by the State Government

7. Shri Hari Ram Primary Health 700-865 810 + other Center Sirsala allowances approved by the State Government

8. Shri Lalchand Primary Health 700-865 810 + other Prajapat Center Shimla allowances approved by the State Government

9. Shri Bhanwar Lal Primary Health 700-865 800 + other Soni Center Vinasar allowances approved by the State Government

10. Shri Mustaq Khan Primary Health 700-865 780 + other Center Digga allowances approved by the State Government

11. Shri Satyanarain Primary Health 700-865 800 + other Center Jasrasar allowances approved by the State Government

12. Shri Om Prakash Primary Health 700-865 800 + other Prajapat Center Ghaghu allowances approved by the State Government

13. Shri keshar Dev Primary Health 700-865 790 + other Center Ghanothi allowances Badi approved by the State Government

14. Shri Balkrishna Primary Health 700-865 790 + other Sharma Center Vaay allowances approved by the State Government

15. Shri Mohanlal Soni Primary Health 700-865 700 + other Center Sakhu allowances approved by the State Government

Sd-

Chief Medical & Health Officer, Ratangarh, Churu

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3. However, the order of pay fixation dated 26th May 1995 was

superseded by an Office Order dated 09th September 1996

whereunder the emoluments to be paid to the petitioners included

Basic Pay, fixed amount of Dearness Allowance and Medical

Allowance of Rs.50/- per month. A direction to the effect of

recovery of excess amount paid to the petitioners was also

contained in the Office Order dated 09th September 1996.

Aggrieved by the drastic change in the service conditions and the

proposed recovery of excess amount, the petitioners approached

the writ Court in S.B. Civil Writ Petition No.4364 of 1996 inter alia

seeking the following reliefs :-

"(a) By an appropriate writ, order or direction, the order dated 9.9.1996 [Annexure/6] may kindly be declared illegal and be quashed with all consequential benefits to the petitioners. The respondents may be directed to refund the amount recovered from the petitioners in pursuance of the order dated 9.9.1996.

(b) By an appropriate writ, order or direction, the conditions No.5 and 7 of the order dated 24.12.1994 be declared illegal and struck down and the respondents be directed to treat the petitioners as regular Govt. employees with entitlement to all benefits which are admissible to other Govt. employees and the undertakings obtained from the petitioners to be bound by unreasonable terms pertaining to emoluments and contractual nature of employment be also

declared illegal."

4. Holding that the conditions under the Circular dated

24th December 1994 were consciously accepted by the petitioners

and it would be a case of contractual injury if they felt that they

have suffered any injury, the writ petition was dismissed on

04th December 1996. Against the writ Court's decision to negate

the prayer made by the petitioners to treat them as regular

government employee and upholding the order dated

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09th September 1996, the petitioners along with Jagdish Prasad

Deora filed D.B. Civil Special Appeal No.21 of 1997 under section

18 of the Rajasthan High Court Ordinance, 1949. During pendency

of the Special Appeal, an amendment was carried out in the writ

petition to challenge the order dated 09 th March 2000 by which the

petitioners were intimated that at the end of five years' period

their services would stand terminated. This Special Appeal was

allowed to the extent that the order dated 09 th September 1996

was quashed by the Division Bench. In its judgment dated

14th March 2000, the Division Bench of this Court found

arbitrariness in the action of the respondents in unilaterally

withdrawing the benefits granted to the petitioners in the Office

Order dated 22nd April 1995. This Court further observed that the

State Government as an employer was under obligation to act

fairly and without any trails of arbitrariness and unreasonableness

whether the appointment was offered under the Rules or under

the contract. The order dated 14th March 2000 passed by the

Division Bench to this effect was challenged by the State of

Rajasthan before the Hon'ble Supreme Court in Special Leave to

Appeal (Civil) No.2221 of 2001 and the same has been dismissed

by an order dated 08th October 2001. In the meantime, the

petitioners had laid a proceeding under the Contempt of Courts

Act, 1971 alleging non-compliance of the direction issued by the

Division Bench in D.B. Civil Special Appeal No.21 of 1997. The said

contempt case was disposed of in light of the stand taken by the

respondents that necessary order for payment of arrears of

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allowances was passed by the Deputy Secretary, Department of

Medical and Health. However, a liberty was reserved with the

petitioners to pursue their remedy for redressal of their grievance

that increments were not paid to them and the quantification of

the arrears of allowance was not correct.

5. Mr. M.S. Singhvi, the learned senior counsel for the

petitioners submitted that the Rajasthan Civil Services (Revised

Pay Scales) Rules, 1998 must be held applicable in case of the

petitioners as they were offered appointment in the pay scale of

Class IV employees and the competent authority passed an order

of fixation of pay after they tendered joining and were employed

at different places. The learned senior counsel for the petitioners

further contended that the Rajasthan Service Rules, 1951 are also

applicable and the petitioners are entitled to draw increments and

other allowances at par with other employees of the State

Government, inasmuch as, the applicability of the Rajasthan

Service Rules, 1951 in relation to the retrenched employees who

were offered employment on contract basis was not excluded in

the Circular dated 24th December 1994. The submission of Mr.

M.S. Singhvi, the learned senior counsel for the petitioners is that

the petitioners who were appointed against the post of Class IV

employees and discharged the same and similar duties as

assigned to other Class IV employees and having been granted

various service-linked benefits must be held entitled to seek

revision in the pay scale, General Provident Fund, State Insurance

and increments as admissible to the other government employees.

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The learned senior counsel lastly submitted that the offer of

appointment on contract basis was accepted by the petitioners

under coercion and they had no other option but to fill up the

application form for their employment which contained the

formatted undertaking.

6. Much emphasis was laid by Mr. N.S. Rajpurohit, the learned

Additional Advocate General on the undertakings signed by the

writ petitioners which was framed in the following terms :-

"The undersigned is willing to accept the contractual engagement in State Government subsequent to my retrenchment in pursuance of the agreed terms and conditions given in the Government Circular No.FS (1) DOP/P-11/ 74 dated 24th December 1994 for engagement of retrenched employees of State Public Sector Undertakings/Enterprises in the Government. I hereby agree and undertake to abide by the said terms of contractual engagement for retrenched employees of PSUs. This undertaking from part of the application form for employment of contract engagement which was required to be filled up by the retrenched employees of the State Public Sector Undertakings/Enterprises. At the time when the writ petitioners suffered retrenchment, they had put in 20 years of service except one."

7. The learned Additional Advocate General contended that the

petitioners who accepted the contractual employment without any

protest must be held bound by the conditions of service laid down

under the Circular dated 24th December 1994. The learned

Additional Advocate General raised a serious objection to the

prayer seeking revised pay scale on the ground that a challenge

laid to clauses 5 and 7 in the previous writ proceeding had failed

and no relief in this regard was granted by the Court. It is further

submitted that the process of selection of the regular employees

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and contractual employees like the petitioners is different and

there being logical differentiation in the service conditions of both

category of the employees, the petitioners cannot be granted any

relief in the present proceeding. It is contended that the scope of

judicial review in case of pay parity is very limited and "equal pay

for equal work" is not a fundamental right (refer, "State of Madhya

Pradesh v. R.D. Sharma & Anr."1). In the context of pay parity, the

learned Additional Advocate General further submitted with

reference to the decision in "Dr. K.M. Sharma & Ors. v. State of

Chattisgargh & Ors."2 that the persons appointed under different

Rules cannot claim parity in pay scales, particularly, when they

were appointed under different modes of selection. The

learned Additional Advocate General also referred to

the decision in "Punjab State Cooperative Milk Producers

Federation Ltd. & Anr. v. Balbir Kumar Walia & Ors." 3 and "Rajesh

Pravinchandra Rajyaguru v. Gujarat Water Supply and Sewarage

Board and Ors."4 and submitted that the factors to be considered

for revision in pay scale are missing in the case of the petitioners.

8. The Rajasthan Civil Services (Revised Pay Scales) Rules,

1998 came into force with effect from 1 st day of September 1996

except where otherwise specifically provided. Rule (ii) enumerates

the persons to whom the Revised Pay Scales Rules shall not apply.

There are eight specific class of persons including the persons

employed on contract who are made ineligible to seek benefits

under the Revised Pay Scales Rules. The respondents have taken a 1 (2022) 13 SCC 320 2 (2022) 11 SCC 436 3 (2021) 8 SCC 784 4 (2021) 19 SCC 128

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stand that the petitioners who were employed on contract cannot

seek revision in pay scales in view of specific exclusion under

clause (c) to Rule 2(ii) of the Rajasthan Civil Services (Revised Pay

Scales) Rules, 1998. Besides that the validity of clause (c) is

under challenge in the present proceeding, Mr. M.S. Singhvi, the

learned counsel for the petitioners laid stress on the expression

"except when the contract provides otherwise" and submitted that

the appointment letter dated 22nd April 1995 did not stipulate and

put a condition that the retrenched writ petitioners cannot seek

revision in their pay scales as approved by the Government for the

permanent employees from time to time.

9. Rule 2(ii) of the Rajasthan Civil Services (Revised Pay

Scales) Rules, 1998 reads as under :-

"(ii) These rules shall not apply to-

(a) persons not in whole time employment of the Government;

(b) persons paid out of contingencies;

(c) persons employed on contract except when the contract provides otherwise;

(d) Government servants who after their retirement, whether on attaining the age of superannuation or otherwise, were re-employed by the Government and were in service on 1-9-1996;

(e) Ex-Military personnel re-employed by the Government and who were in service on 1-9-1996;

(f) persons employed on work-changed basis including those who are governed by the Rajasthan Public Works Department (Building & Roads) including Gardens, Irrigation, Water Works and Ayurvedic Department Work Charged Employees Service Rules, 1964;

(g) teachers of Government Colleges drawing pay in a scale prescribed under the Rajasthan Civil Services (Revised Pay Scales for Government College Teachers) Rules, 1988;

(h) person who may be specifically excluded wholly or in part by the Governor from the operation of these rules."

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10. The petitioners were appointed under the Rajasthan Small

Industries Corporation against the allocated posts for Class IV

employees in the office of the Chief Medical and Health Officer at

Ratangarh, Churu. The Office Order dated 22 nd April 1995 by

which the petitioners were appointed refers to the Circular dated

24th December 1994 and a copy thereof was communicated to the

Special Secretary, General Administration (Group-III) Government

of Rajasthan, Secretary, Bureau of Public Enterprises, Director,

Medical and Health Services and five other authorities including

the Departmental Commissioner at Bikaner. What is important to

note in the Office Order dated 22nd April 1995 is that it clearly

mentions that the Class IV employees' posts were allocated for

appointment of the writ petitioners and they were given pay scales

of Rs.750-940/- and Rs.700-865/-. By the Office Order dated

26th May 1995, the pay fixation in respect of the petitioners was

approved and they continued in service till they attained the age

of 60 years after having served for more than 20 years under the

Government Department, except Jagdish Prasad Deora and

Chagan Lal Sharma; Mohan Lal Soni served for more than 27

years and superannuated from service with effect from 20 th July

2000. They were appointed under the Rajasthan Small Scale

Industries Corporation by following the due process and their

appointment pursuant to the policy decision of the government

was also therefore in consonance with Article 14 and Article 16 of

the Constitution of India. They received salary from the Medical

and Health Department and there was a direct employer-employee

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relationship between them and the Government Department.

Though appointed on contract, the petitioners performed the

duties which were integral part of the office of the Chief Medical

and Health Superintendent. Their long standing services and the

direct supervision of the Government Department clearly

demonstrate that it was an exploitative engagement even in terms

of the direction in paragraph no.53 in "Secretary, State of

Karnataka & Ors. v. Umadevi(3) & Ors."5, and were entitled for

similar benefits as given to the permanent employees on the basis

of "equal pay for equal work". The decisions relied upon by the

learned Additional Advocate General are clearly distinguishable on

facts. In "R.D. Sharma", the decision of the Administrative

Tribunal rejecting the claim of the employee for Apex Scale on the

basis of "equal pay for equal work" was set aside by the High

Court. It was in the context of the power of Superintendence

under Article 227 of the Constitution of India that the Supreme

Court held that the High Court could not have interfered with the

decision of the Tribunal because the task of job evaluation which

includes various factors is ordinarily the function of the executive

and not of the judiciary. In "Dr. K.M. Sharma", the employees

appointed as Shiksha Karmis under different Rules and through a

different mode of selection were held not entitled to seek parity in

pay scale with the Municipal Teachers. The decision in "Rajesh

Pravinchandra Rajyaguru" turns on its own peculiar facts

inasmuch as the employees were appointed as daily-rated

employees. In "Gujarat Water Supply and Sewarage Board" which

5 (2006) 4 SCC 1

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was an autonomous body, the Hon'ble Supreme Court held that it

was for the Board to take a conscious decision on the pay scales

to be adopted and benefits to be given to its employees having

regard to the financial implications. The decision in "Punjab State

Co-operative Milk Federation" is concerning the financial

stringency of the industrial undertakings, public sector

corporations and the government employees. Similarly, in "A.K.

Bindal & Anr. v. Union of India & Ors." 6 the Hon'ble Supreme

Court held that the employees cannot claim any legal right to

seek revision in the pay scale if the Corporation is sustaining

losses continuously over a period and does not have the financial

capacity to revise or enhance the pay scale. Whereas, the

petitioners were working under the Government Department after

their retrenchment and no plea of financial crunch has been raised

by the respondents.

11. "Jaggo v. Union of India & Ors."7 is the decision on the point

wherein the employees were engaged by the Central Water

Commission on part time and ad-hoc terms as sweeper primarily

responsible for cleaning and maintaining the office premises under

the CWC and were entrusted with the tasks such as gardening,

dusting and other maintenance and house keeping works.

Observing that the employees though labeled as "part-time

workers" performed the essential tasks typically associated with

the sanctioned posts and that too on a daily and continuous basis

over extensive periods ranging over one decade to nearly two

6 (2003) 5 SCC 163 7 (2024) SCC OnLine SC 3826

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decades, the Hon'ble Supreme Court held that the employees

were entitled for regularization of their service. While holding so,

the Hon'ble Supreme Court reflected on the pervasive misuse of

temporary employment contracts in paragraph nos.22-27 of the

reported judgment, thus:-

"22. The pervasive misuse of temporary employment contracts, as exemplified in this case, reflects a broader systemic issue that adversely affects workers' rights and job security. In the private sector, the rise of the gig economy has led to an increase in precarious employment arrangements, often characterized by lack of benefits, job security, and fair treatment. Such practices have been criticized for exploiting workers and undermining labour standards. Government institutions, entrusted with upholding the principles of fairness and justice, bear an even greater responsibility to avoid such exploitative employment practices. When public sector entities engage in misuse of temporary contracts, it not only mirrors the detrimental trends observed in the gig economy but also sets a concerning precedent that can erode public trust in governmental operations.

23. The International Labour Organization (ILO), of which India is a founding member, has consistently advocated for employment stability and the fair treatment of workers. The ILO's Multinational Enterprises Declaration encourages companies to provide stable employment and to observe obligations concerning employment stability and social security. It emphasizes that enterprises should assume a leading role in promoting employment security, particularly in contexts where job discontinuation could exacerbate long-term unemployment.

24. The landmark judgment of the United State in the case of Vizcaino v. Microsoft Corporation serves as a pertinent example from the private sector, illustrating the consequences of misclassifying employees to circumvent providing benefits. In this case, Microsoft classified certain workers as independent contractors, thereby denying them employee benefits. The U.S. Court of Appeals for the Ninth Circuit determined that these workers were, in fact, common-law employees and were entitled to the same benefits as regular employees. The Court noted that large Corporations have increasingly adopted the practice of hiring temporary employees or independent contractors as a means of

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avoiding payment of employee benefits, thereby increasing their profits. This judgment underscores the principle that the nature of the work performed, rather than the label assigned to the worker, should determine employment status and the corresponding rights and benefits. It highlights the judiciary's role in rectifying such misclassifications and ensuring that workers receive fair treatment.

25. It is a disconcerting reality that temporary employees, particularly in government institutions, often face multifaceted forms of exploitation. While the foundational purpose of temporary contracts may have been to address short-term or seasonal needs, they have increasingly become a mechanism to evade long-term obligations owed to employees. These practices manifest in several ways:-

Misuse of "Temporary" Labels: Employees engaged for work that is essential, recurring, and integral to the functioning of an institution are often labeled as "temporary" or "contractual,"

even when their roles mirror those of regular employees. Such misclassification deprives workers of the dignity, security, and benefits that regular employees are performing identical tasks. entitled to, despite performing identical tasks. Arbitrary Termination: Temporary employees are frequently dismissed without cause or notice, as seen in the present case. This practice undermines the principles of natural justice and subjects workers to a state of constant insecurity, regardless of the quality or duration of their service.

Lack of Career Progression: Temporary employees often find themselves excluded from opportunities for skill development, promotions, or incremental pay raises. They remain stagnant in their roles, creating a systemic disparity between them and their regular counterparts, despite their contributions being equally significant.

Using Outsourcing as a Shield: Institutions increasingly resort to outsourcing roles performed by temporary employees, effectively replacing one set of exploited workers with another. This practice not only perpetuates exploitation but also demonstrates a deliberate effort to bypass the obligation to offer regular employment.

Denial of Basic Rights and Benefits: Temporary employees are often denied fundamental benefits such as pension, provident fund, health insurance, and paid leave, even when their tenure spans decades. This lack of social security subjects them and

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their families to undue hardship, especially in cases of illness, retirement, or unforeseen circumstances.

26. While the judgment in Uma Devi (supra) sought to curtail the practice of backdoor entries and ensure appointments adhered to constitutional principles, it is regrettable that its principles are often misinterpreted or misapplied to deny legitimate claims of long- serving employees. This judgment aimed to distinguish between "illegal" and "irregular" appointments. It categorically held that employees in Irregular appointments, who were engaged in duly sanctioned posts and had served continuously for more than ten years, should be considered for regularization as a one-time measure. However, the laudable intent of the judgment is being subverted when institutions rely on its dicta to indiscriminately reject the claims of employees, even in cases where their appointments are not illegal, but merely lack adherence to procedural formalities. Government departments often cite the judgment in Uma Devi (supra) to argue that no vested right to regularizatin exists for temporary employees, overlooking the judgment's explicit acknowledgment of cases where regularization is appropriate. Thus selective application distorts the judgment's spirit and purpose, effectively weaponizing it against the judgment's spirit and purpose, effectively weaponizing it against employees who have rendered indispensable services over decades.

27. In light of these considerations, in our opinion, it is imperative for government departments to lead by example in providing fair and stable employment. Engaging workers on a temporary basis for extended periods, especially when their roles are integral to the organization's functioning, not only contravenes international labour standards but also exposes the organization to legal challenges and undermines employee morale. By ensuring fair employment practices, government institutions can reduce the burden of unnecessary litigation, promote job security, and uphold the principles of justice and fairness that they are meant to embody. This approach aligns with International standards and sets a positive precedent for the private sector to follow, thereby contributing to the overall betterment of labour practices in the country."

12. In "Rajkaran Singh & Ors. v. Union of India & Ors."8, which is

another decision referred to by the learned senior counsel for the

8 (2024) SCC OnLine SC 2138

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petitioners, the employees who were appointed to manage the

Compulsory Saving Scheme Deposits Fund which was created

through the personal contribution of the Special Frontier Force

from their salaries claimed the benefits of the replacement scale of

the Revised Pay Rules, 2008 as per the recommendation of 6th Pay

Commission. The objection taken by the Union of India was that

those employees were not government employees and not

appointed by following any Recruitment Rules and, therefore, the

Central Civil Services Pension Rules, 1972 were not applicable to

them. Another objection raised on behalf of the Union of India was

that the services performed by such employees were not statutory

in nature because the SSD fund was a voluntary contribution

made by the SFF employees and the services rendered by them

did not qualify as government service. The Hon'ble Supreme Court

referred to the decision in "Ajay Hasia & Ors. v. Khalid Mujib

Sehravardi & Ors."9, "Pradeep Kumar Vishwas v. Indian Institute

of Chemical Biology & Ors."10 and "R.D. Shetty v. The

International Airport Authority of India"11 and held that their

employment had the characteristic of regular government

employees and the denial of pensionary benefits to them on the

basis of their temporary status was unfair and arbitrary and

violated their fundamental rights under Articles 14 and 16 of the

Constitution of India. In "Rajkaran Singh", the Hon'ble Supreme

Court referred to the decision in "Vinod Kumar & Ors. v. Union of

India & Ors."12, wherein it was held that the essence of

9 (1981) 1 SCC 722 10 (2002) 5 SCC 111 11 (1979) 3 SCC 489 12 (2024) SCC OnLine SC 1533

[2025:RJ-JD:29035-DB] (19 of 26) [CW-1268/2003]

employment and rights of the employees flowing thereof cannot

be determined merely by the initial terms of appointment when

actual course of employment has evolved significantly over time.

In "Vinod Kumar", the Hon'ble Supreme Court observed as under:-

"5. Having heard the arguments of both the sides, this Court believes that the essence of employment and the rights thereof cannot be merely determined by the initial terms of appointment when the actual course of employment has evolved significantly over time. The continuous service of the appellants in the capacities of regular employees, performing duties indistinguishable from those in permanent posts, and their selection through a process that mirrors that of regular recruitment, constitute a substantive departure from the temporary and scheme-specific nature of their initial engagement. Moreover, the appellants' promotion process was conducted and overseen by a Departmental Promotional Committee and their sustained service for more than 25 years without any indication of the temporary nature of their roles being reaffirmed or the duration of such temporary engagement being specified, merits a reconsideration of their employment status.

6. The application of the judgment in Uma Devi (supra) by the High Court does not fit squarely with the facts at hand, given the specific circumstances under which the appellants were employed and have continued their service. The reliance on procedural formalities at the outset cannot be used to perpetually deny substantive rights that have accrued over a considerable period through continuous service. Their promotion was based on a specific notification for vacancies and a subsequent circular, followed by a selection process involving written tests and interviews, which distinguishes their case from the appointments through back door entry as discussed in the case of Uma Devi (supra).

7. The judgment in the case Uma Devi (supra) also distinguished between "irregular" and "illegal" appointments underscoring the importance of considering certain appointments even if were not made strictly in accordance with the prescribed Rules and Procedure, cannot be said to have been made illegally if they had followed the procedures of regular appointments such as conduct of written examinations or interviews as in the present case. Paragraph 53 of the Uma Devi (supra) case is reproduced hereunder:

[2025:RJ-JD:29035-DB] (20 of 26) [CW-1268/2003]

53. One aspect needs to be clarified. There may be cases where irregular appointments (not illegal appointments) as explained in S.V. Narayanappa [(1967) 1 SCR 128], R.N. Nanjundappa [(1972) 1 SCC 409] and B.N. Nagarajan [(1979) 4 SCC 507] and referred to in para 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 the courts or of tribunals. The question of regularisation 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 regularise 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 the courts or of tribunals and should further ensure that regular recruitment 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 bypassing of the constitutional requirements and regularising or making permanent, those not duly appointed as per the constitutional scheme.

8. In light of the reasons recorded above, this Court finds merit in the appellants' arguments and hold that their service conditions, as evolved over time, warrant a reclassification from temporary to regular status. The failure to recognize the substantive nature of their roles and their continuos service akin to permanent employees runs counter to the principles of equity, fairness, and the intent

behind employment regulations."

13. In summation, we hold that the petitioners' employment

under the Health Department had all the trappings of regular

appointment and mere labeling of their employment "on contract

[2025:RJ-JD:29035-DB] (21 of 26) [CW-1268/2003]

basis" shall not deprive them of the benefits under the Rajasthan

Civil Services (Revised Pay Scales) Rules, 1998.

14. The petitioners have produced a copy of the Last Pay

Certificate and the salary details for the year 1995-96 which

reveal that they were paid Dearness Allowance, Washing

Allowance, House Rent Allowance, etc. and deductions were made

from their salary on account of Provident Fund and State

Insurance. Still, the respondents have pleaded that the Rajasthan

Service Rules, 1951 shall not apply to the petitioners and they are

not entitled for increment and other service-linked benefits. This

plea has been taken by the respondents on the ground that the

letter of appointment to the petitioners did not contain a

stipulation that the Rajasthan Service Rules, 1951 shall apply to

them. However, Rule 2(iii)(a) clearly provides that these Rules

shall apply to all persons appointed on contract basis except to the

category of employees mentioned therein. Even the Office Order

dated 26th May 1995 provided that other allowances as approved

by the State Government shall be paid to the petitioners. This also

needs to be indicated that any service condition in the letter of

appointment which is contrary to the statutory Rules under the

Rajasthan Service Rules, 1951 shall be inapplicable and must be

held inoperative. The Circular dated 24 th December 1994 labeled

as "Guidelines for Engaging the Retrenched Employees of Public

Sector Undertakings on Contract" provided that a revision in the

emoluments paid to such contractual employees may be

considered to the extent of Dearness Allowance paid to the regular

[2025:RJ-JD:29035-DB] (22 of 26) [CW-1268/2003]

government employees while renewing the contract after expiry of

the contract period. However, the guidelines are administrative

instructions issued under the signature of the Secretary to

Government and not statutory in nature and have no force of law

to curtail the rights of the retrenched employees to seek the

benefits which were otherwise admissible to them and were

previously granted to them pursuant to the order of pay fixation.

In fact, the provisions under the Rajasthan Service Rules are

referred in the Circular dated 24th December 1994 and the leave

terms and Appendix-II of the Rajasthan Service Rules (Volume II)

are made applicable to the contractual employees. It is further

provided that TA and DA shall be paid to them as per the

Travelling Allowances Rules of the Government. Even the Medical

Allowance of Rs.50/- per month has also been provided to the

employees engaged on contract basis in the Government.

Furthermore, one of the guidelines provided under the Circular

dated 24th December 1994 was that the retrenched employees

appointed on contract shall be eligible for 12 days' casual leave in

a calendar year. As regards payment of salary and other benefits

to the petitioners, this also needs a mention that in the previous

proceeding this Court held that if the emoluments paid to the

petitioners did not exceed the last pay drawn by them and if the

same emoluments drawn previously by them have been offered to

be paid in the same manner that was not per se contrary to the

guidelines dated 24th December 1994. This Court discussed this

[2025:RJ-JD:29035-DB] (23 of 26) [CW-1268/2003]

issue in the order dated 14 th March 2000 in the following

manner :-

"Now we come to the controversy regarding reduction of pay. In fixing term of appointment under the contract, it had not been provided how the contract emoluments shall be fixed. No rigidly fixed emoluments have been provided. The guidelines provided giving appointments not only to equivalent posts but to lower posts. About fixing of emoluments, matter has been left to be decided subject to limitation that it shall not exceed last drawn emoluments. If the last pay drawn by the retrenched employee were the basic pay + Dearness Allowance as granted by the State Govt. from time to time, the fixation of pay under the contract emoluments by fixing last drawn basic pay + Dearness Allowance as granted by the State Govt. cannot be said to be fixing emoluments exceeding the last pay drawn by the retrenched employee. If the same emoluments were being drawn by the employee have been offered to be paid in same manner it cannot be said to be per se contrary to the guidelines. It has not been shown that on the date of appointment, any one has been fixed with more emoluments than that were being paid to him. Moreover, the guidelines restricts the right of employee to claim more than what has been devised in the scheme, but it does not restrict the State to offer better emoluments. If no better emoluments are offered while giving appointment under the Scheme, perhaps no ground could have been raised by the incumbents to claim more beneficial terms. Question of withdrawal of emoluments once having given is a different question, particularly when pay and allowances are not governed by statutory rules but

depends on executive order for its determination. ............"

15. Besides that, this is not in dispute that the petitioners after

fixation of their pay received their salary which included Basic Pay,

Dearness Allowance and other allowances as granted by the State

Government from time to time. Now by virtue of order dated 08 th

October 2001 passed by the Hon'ble Supreme Court whereby the

Special Leave Petition preferred by the State of Rajasthan and its

Officers came to be dismissed and the order dated 14 th March

[2025:RJ-JD:29035-DB] (24 of 26) [CW-1268/2003]

2000 passed in D.B. Special Leave to Appeal No.2221 of 2001 was

affirmed, the Office Order 26th May 1995 has been restored and

the petitioners have become entitled to claim the benefits which

were initially granted to them under the said Office Order. The

respondents have also not pleaded in their counter affidavit that

the pay scale and other benefits previously granted to the

petitioners were more than the emoluments paid to them while

they were working under the Corporation. In view thereof, clause

7 under the Circular dated 24th December 1994 which provided

that the emoluments paid to the retrenched employees who were

appointed on contract basis shall not exceed to the emoluments

last drawn by them has become irrelevant in this case. Even so,

we must indicate that after the decision in "Central Inland Water

Transport Corporation Ltd. v. Brojo Nath Ganguly & Anr." 13 this is

a settled position in law that where a term of contract or

agreement entered into between the parties is completely one-

sided, unfair and unreasonable and where the other party had no

or less bargaining power but to accept such term by force of

circumstances, the Court shall not enforce such condition of

service and strike down the same as unfair and unreasonable

contract. In "Central Inland Water Transport Corporation", the

Hon'ble Supreme Court held as under :-

"89.The Constitution was enacted to secure to all the citizens of this country social and economic justice. Article 14 of the Constitution guarantees to all persons equality before the law and the equal protection of the laws. The principle deducible from the above discussions on this part of the case is in consonance with right and reason, intended to secure social and economic justice and

13 (1986) 3 SCC 156

[2025:RJ-JD:29035-DB] (25 of 26) [CW-1268/2003]

conforms to the mandate of the great equality clause in Article 14. This principle is that the courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between parties who are not equal in bargaining power. It is difficult to give an exhaustive list of all bargains of this type. No court can visualise the different situations which can arise in the affairs of men. One can only attempt to give some illustrations. For instance, the above principle will apply where the inequality of bargaining power is the result of the great disparity in the economic strength of the contracting parties. It will apply where the inequality is the result of circumstances, whether of the creation of the parties or not. It will apply to situations in which the weaker party is in a position in which he can obtain goods or services or means of livelihood only upon the terms imposed by the stronger party or go without them. It will also apply where a man has no choice, or rather no meaningful choice, but to give his assent to a contract or to sign on the dotted line in a prescribed or standard form or to accept a set of rules as part of the contract, however unfair, unreasonable and unconscionable a clause in that contract or form or rules may be. This principle, however, will not apply where the bargaining power of the contracting parties is equal or almost equal. This principle may not apply where both parties are businessmen and the contract is a commercial transaction. In today's complex world of giant corporations with their vast infrastructural organisations and with the State through its instrumentalities and agencies entering into almost every branch of industry and commerce, there can be myriad situations which result in unfair and unreasonable bargains between parties possessing wholly disproportionate and unequal bargaining power. These cases can neither be enumerated nor fully illustrated. The court must judge

each case on its own facts and circumstances."

16. Having found so, we hold that the petitioners are entitled for

revision in the pay scales on the same lines as was granted to

other Class-IV regular employees under the Medical and Health

Department. They are also held entitled for increments and the

benefits of General Provident Fund and State Insurance as

reflected in the Last Pay Certificate and provided to them before

[2025:RJ-JD:29035-DB] (26 of 26) [CW-1268/2003]

the Office Order dated 09th September 1996 came to be passed.

As the contributions on account of General Provident Fund and

State Insurance were not deducted from their salary by the

respondent-Authority even though the Office Order dated

09th September 1996 was quashed, the petitioners are held not

liable to pay any interest over the balance amount of contributory

deposit. For availing the benefits of General Provident Fund and

State Insurance, the petitioners shall deposit within eight weeks

the total amount of their contribution as per the Rules and if, they

do so, the General Provident Fund and State Insurance shall be

paid to them within next eight weeks.

17. D.B. Civil Writ Petition No. 1268 of 2003 is allowed in terms

of the aforesaid directions.

                                   (SANDEEP SHAH),J                            (SHREE CHANDRASHEKHAR),J


                                    138-Arjun/-

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