Surajit Kumar Panigrahi vs State Of Odisha & Ors

Biraja Prasanna Satapathy, J

Heard Mr. R.P. Kar, learned Senior Counsel for the Petitioner along with Mr. A.N. Ray, learned counsel, Mr. P.K. Sahoo, learned Addl. Standing Counsel appearing for the Opp. Parties and Mr. Ramesh Sahoo, learned counsel appearing for Opp. Party No.3.

The present Writ Petition has been filed inter alia with the following prayer:-

"In the facts and circumstances stated above and in the interest of justice this Hon'ble Court be graciously pleased to issue Rule NISI calling upon the Opp. Parties to show cause as to why the order in Annexure-7 shall not be set aside and in the event the Opp. Parties fail to show sufficient cause or show insufficient cause the said Rule may be made absolute and the order in Annexure- be set aside.

And further be pleased to direct the Opp. Party No.2 to regularize the service of the petitioner as has been done in the case of other similarly situated employees and grant him all consequential service benefits as has been paid to others.

And further be pleased to pass such other order/orders, direction/directions as this Hon'ble Court deems fit and proper in the interest of justice.

And for this act of kindness, the petitioner as in duty bound ever pray."

It is contended that even though Petitioner admittedly was engaged as a DLR Steno vide office order dated 24.06.1993 under Annexure-1 and Petitioner joined on the very same day, but Petitioner's claim for regularization has been rejected vide the impugned order dated 17.09.2025 under Annexure-7 by Opp. Party No.2, inter alia on the ground that since Petitioner's engagement is after the cut-off date so fixed by Finance Department in its resolution dated 15.05.1997, Petitioner is not eligible and entitled to get the benefit of regularization.

3.1. Learned Senior Counsel appearing for the Petitioner contended that with regard to engagement of DLR/NMR in different Urban Local Bodies of the State, the cut-off date was fixed as 19.05.1997 by the Govt. in the Housing & Urban Development Department vide its notification dated 15.12.2000. (Copy of the notification so produced in Court be kept in record).

3.2. Learned Senior Counsel appearing for the Petitioner contended that since the cut-off date with regard to engagement of NMR/DLR in Urban Local Bodies has been fixed as 19.05.1997 vide notification dated 15.12.2000, it cannot be held that Petitioner's engagement is after the cut-off date, so held in the impugned order dated 17.09.2025 under Annexure-7.

3.3. It is also contended that placing reliance on the aforesaid notification, this Court while disposing W.P.(C) No.12548 of 2022 vide judgment dated 28.11.2025, has also held that cut-off date with regard to engagement of NMR/DLR in Urban Local Bodies has to be taken as 19.05.1997.

3.4. It is also contended that since Petitioner is continuing as a DLR, which is not disputed w.e.f. 24.06.1993, in view of the decisions of the Hon'ble Apex Court in the case of Jaggo vs. Union of India & Ors., 2024 SCC OnLine SC 3826; Shripal & Anr. vs. Nagar Nigam, Ghaziabad, 2025 SCC OnLine SC 221 as well as Dharam Singh & Ors. vs. State of U.P. & Anr. (Civil Appeal No(s).8558 of 2018 and lastly in the case of Bhola Nath Vs. State of Jharkhand and Others, 2026 INSC 99, Petitioner is otherwise entitled to get the benefit of regularization.

3.5. View expressed by the Hon'ble Apex Court in the case of Jaggo in Para-22 to 25 and 27 reads as follows:-

"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.

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 Declaration6 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.

The landmark judgement of the United State in the case of Vizcaino v. Microsoft Corporation7 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 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.

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

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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."

3.6. Hon'ble Apex Court in the case of Shripal in Para-14, 15, 17 & 18(IV) has held as follows:-

"14. More importantly, Uma Devi cannot serve as a shield to justify exploitative engagements persisting for years without the Employer undertaking legitimate recruitment.

Indian labour law strongly disfavors perpetual daily- wage or contractual engagements in circumstances where the work is permanent in nature.

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Indeed, bureaucratic limitations cannot trump the legitimate rights of workmen who have served continuously in de facto regular roles for an extended period.

18.(IV) The Respondent Employer is directed to initiate a fair and transparent process for regularizing the Appellant Workmen within six months from the date of reinstatement, duly considering the fact that they have performed perennial municipal duties akin to permanent posts. In assessing regularization, the Employer shall not impose educational or procedural criteria retroactively if such requirements were never applied to the Appellant Workmen or to similarly situated regular employees in the past. To the extent that sanctioned vacancies for such duties exist or are required, the Respondent Employer shall expedite all necessary administrative processes to ensure these longtime employees are not indefinitely retained on daily wages contrary to statutory and equitable norms."

3.7. Placing reliance on the decision in the case of Jaggo and Shripal, Hon'ble Apex Court in the case of Dharam Singh, in Paragraph-13, 14, 15 & 17, 18, 19 & 20 has held as follows:

"13. As we have observed in both Jaggo (Supra) and Shripal (Supra), outsourcing cannot become a convenient shield to perpetuate precariousness and to sidestep fair engagement practices where the work is inherently perennial. The Commission's further contention that the appellants are not "full-time" employees but continue only by virtue of interim orders also does not advance their case. That interim protection was granted precisely because of the long history of engagement and the pendency of the challenge to the State's refusals. It neither creates rights that did not exist nor erases entitlements that may arise upon a proper adjudication of the legality of those refusals.

The learned Single Judge of the High Court also declined relief on the footing that the petitioners had not specifically assailed the subsequent decision dated 25.11.2003. However, that view overlooks that the writ petition squarely challenged the 11.11.1999 refusal as the High Court itself directed a fresh decision during pendency, and the later rejection was placed on record by the respondents. In such circumstances, we believe that the High Court was obliged to examine the legality of the State's stance in refusing sanction, whether in 1999 or upon reconsideration in 2003, rather than dispose of the matter on a mere technicality. The Division Bench of the High Court compounded the error by affirming the dismissal without engaging with the principal challenge or the intervening material. The approach of both the Courts, in reducing the dispute to a mechanical enquiry about "rules" and "vacancy" while ignoring the core question of arbitrariness in the State's refusal to sanction posts despite perennial need and long service, cannot be sustained.

Therefore, in view of the foregoing observations, the impugned order of the High Court cannot be sustained. The State's refusals dated 11.11.1999 and 25.11.2003,in so far as they concern the Commission's proposals for sanction/creation of Class-III/Class-IV posts to address perennial ministerial/attendant work, are held unsustainable and stand quashed.

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Before concluding, we think it necessary to recall that the State (here referring to both the Union and the State governments) is not a mere market participant but a constitutional employer. It cannot balance budgets on the backs of those who perform the most basic and recurring public functions. Where work recurs day after day and year after year, the establishment must reflect that reality in its sanctioned strength and engagement practices. The long-term extraction of regular labour under temporary labels corrodes confidence in public administration and offends the promise of equal protection. Financial stringency certainly has a place in public policy, but it is not a talisman that overrides fairness, reason and the duty to organise work on lawful lines.

Moreover, it must necessarily be noted that "ad-hocism" thrives where administration is opaque. The State Departments must keep and produce accurate establishment registers, muster rolls and outsourcing arrangements, and they must explain, with evidence, why they prefer precarious engagement over sanctioned posts where the work is perennial. If "constraint" is invoked, the record should show what alternatives were considered, why similarly placed workers were treated differently, and how the chosen course aligns with Articles 14, 16 and 21 of the Constitution of India. Sensitivity to the human consequences of prolonged insecurity is not sentimentality. It is an institutional discipline that should inform every decision affecting those who keep public offices running.

Having regard to the long, undisputed service of the appellants, the admitted perennial nature of their duties, and the material indicating vacancies and comparator regularisations, we issue the following directions:

i. Regularization and creation of Supernumerary posts: All appellants shall stand regularized with effect from 24.04.2002, the date on which the High Court directed a fresh recommendation by the Commission and a fresh decision by the State on sanctioning posts for the appellants. For this purpose, the State and the successor establishment (U.P. Education Services Selection Commission) shall create supernumerary posts in the corresponding cadres, Class-III (Driver or equivalent) and Class-IV (Peon/Attendant/Guard or equivalent) without any caveats or preconditions. On regularization, each appellant shall be placed at not less than the minimum of the regular pay-scale for the post, with protection of last-drawn wages if higher and the appellants shall be entitled to the subsequent increments in the pay scale as per the pay grade. For seniority and promotion, service shall count from the date of regularization as given above.

ii. Financial consequences and arrears: Each appellant shall be paid as arrears the full difference between (a) the pay and admissible allowances at the minimum of the regular pay-level for the post from time to time, and (b) the amounts actually paid, for the period from 24.04.2002 until the date of regularization

/retirement/death, as the case may be. Amounts already paid under previous interim directions shall be so adjusted. The net arrears shall be released within three months and if in default, the unpaid amount shall carry compound interest at 6% per annum from the date of default until payment.

iii. Retired appellants: Any appellant who has already retired shall be granted regularization with effect from 24.04.2002 until the date of superannuation for pay fixation, arrears under clause (ii), and recalculation of pension, gratuity and other terminal dues. The revised pension and terminal dues shall be paid within three months of this Judgment.

iv. Deceased appellants: In the case of Appellant No. 5 and any other appellant who has died during pendency, his/her legal representatives on record shall be paid the arrears under clause (ii) up to the date of death, together with all terminal/retiral dues recalculated consistently with clause (i), within three months of this Judgement.

v. Compliance affidavit: The Principal Secretary, Higher Education Department, Government of Uttar Pradesh, or the Secretary of the U.P. Education Services Selection Commission or the prevalent competent authority, shall file an affidavit of compliance before this Court within four months of this Judgement.

We have framed these directions comprehensively because, case after case, orders of this Court in such matters have been met with fresh technicalities, rolling "reconsiderations," and administrative drift which further prolongs the insecurity for those who have already laboured for years on daily wages. Therefore, we have learned that Justice in such cases cannot rest on simpliciter directions, but it demands imposition of clear duties, fixed timelines, and verifiable compliance .As a constitutional employer, the State is held to a higher standard and therefore it must organise its perennial workers on a sanctioned footing, create a budget for lawful engagement, and implement judicial directions in letter and spirit. Delay to follow these obligations is not mere negligence but rather it is a conscious method of denial that erodes livelihoods and dignity for these workers. The operative scheme we have set here comprising of creation of supernumerary posts, full regularization, subsequent financial benefits, and a sworn affidavit of compliance, is therefore a pathway designed to convert rights into outcomes and to reaffirm that fairness in engagement and transparency in administration are not matters of grace, but obligations under Articles 14, 16 and 21 of the Constitution of India."

3.8. It is contended that in the recent decision of the Hon'ble Apex Court in the case of Bhola Nath so cited (supra), Hon'ble Apex Court in Para- 13.5 to 14 of the judgment has held as follows:-

"13.5. Such a decision must necessarily be a conscious and reasoned one. An employee who has satisfactorily discharged his duties over several years and has been granted repeated extensions cannot, overnight, be treated as surplus or undesirable. We are unable to accept the justification advanced by the respondents as the obligation of the State, as a model employer, extends to fair treatment of its employees irrespective of whether their engagement is contractual or regular.

13.6. This Court has, on several occasions, deprecated the practice adopted by States of engaging employees under the nominal labels of "part-time", "contractual" or "temporary" in perpetuity and thereby exploiting them by not regularizing their positions. In Jaggo v. Union of India, this Court underscored that government departments must lead by example in ensuring fair and stable employment, and evolved the test of examining whether the duties performed by such temporary employees are integral to the day-to-day functioning of the organization.

13.7. In Shripal v. Nagar Nigam, and Vinod Kumar v. Union of India, this Court cautioned against a mechanical and blind reliance on Umadevi (supra) to deny regularization to temporary employees in the absence of statutory rules. It was held that Umadevi (supra) cannot be employed as a shield to legitimise exploitative engagements continued for years without undertaking regular recruitment. The Court further clarified that Umadevi itself draws a distinction between appointments that are "illegal" and those that are merely "irregular", the latter being amenable to regularization upon fulfilment of the prescribed conditions.

13.8. In Dharam Singh v. State of U.P., this Court strongly deprecated the culture of "ad-hocism" adopted by States in their capacity as employers. The Court criticised the practice of outsourcing or informalizing recruitment as a means to evade regular employment obligations, observing that such measures perpetuate precarious working conditions while circumventing fair and lawful engagement practices.

13.9. The State must remain conscious that part-time employees, such as the appellants, constitute an integral part of the edifice upon which the machinery of the State continues to function. They are not merely ancillary to the system, but form essential components thereof. The equality mandate of our Constitution, therefore, requires that their service be reciprocated in a manner free from arbitrariness, ensuring that decisions of the State affecting the careers and livelihood of such part-time and contractual employees are guided by fairness and reason.

13.10. In the aforesaid backdrop, we are unable to persuade ourselves to accept the respondent-State's contention that the mere contractual nomenclature of the appellants' engagement denudes them of constitutional protection. The State, having availed of the appellants' services on sanctioned posts for over a decade pursuant to a due process of selection and having consistently acknowledged their satisfactory performance, cannot, in the absence of cogent reasons or a speaking decision, abruptly discontinue such engagement by taking refuge behind formal contractual clauses. Such action is manifestly arbitrary, inconsistent with the obligation of the State to act as a model employer, and fails to withstand scrutiny under Article 14 of the Constitution.

FINAL CONCLUSION:

In light of our discussion, in the foregoing paragraphs, we summarize our conclusions as follows:

I. The respondent-State was not justified in continuing the appellants on sanctioned vacant posts for over a decade under the nomenclature of contractual engagement and thereafter denying them consideration for regularization.

II. Abrupt discontinuance of such long-standing engagement solely on the basis of contractual nomenclature, without either recording cogent reasons or passing a speaking order, is manifestly arbitrary and violative of Article 14 of the Constitution.

III. Contractual stipulations purporting to bar claims for regularization cannot override constitutional guarantees. Acceptance of contractual terms does not amount to waiver of fundamental rights, and contractual stipulations cannot immunize arbitrary State action from constitutional scrutiny.

IV. The State, as a model employer, cannot rely on contractual labels or mechanical application of Umadevi (supra) to justify prolonged ad-hocism or to discard long-serving employees in a manner inconsistent with fairness, dignity and constitutional governance.

V. In view of the foregoing discussion, we direct the respondent-State to forthwith regularize the services of all the appellants against the sanctioned posts to which they were initially appointed. The appellants shall be entitled to all consequential service benefits accruing from the date of this judgment."

3.9. It is also contended that persons engaged subsequent to the Petitioner in the meantime had got the benefit of regularization vide order issued under Annexure-8 dated 24.05.2017. Since Petitioner has been discriminated vis-à-vis similarly situated DLR and DLRs engaged subsequent to the Petitioner, Petitioner's claim so rejected vide the impugned order requires interference of this Court.

3.10. Making all these submissions, learned Senior Counsel contended that since Petitioner which is not disputed is continuing as a DLR with effect from 24.06.1993 in terms of the order issued under Annexure-1, the grounds on which Petitioner's claim was rejected vide the impugned order is not sustainable in the eye of law.

Mr. Ramesh Sahoo, learned counsel appearing for the Opp. Party No.3 is also fairly contended that Petitioner in terms of order dated 24.06.1993, is continuing in the establishment of Opp. Party No.3 till date and details of the engagement of the Petitioner showing his continuance, is reflected in the communication issued by the Opp. Party No.3 in his letter dated 08.09.2025 under Annexure-A/2.

Even though Writ Petition has been filed challenging order dated 17.09.2025 so passed by Opp. Party No.2 and this Court vide order dated 09.02.2026 directed the State Counsel to obtain instruction, but no counter affidavit has been filed by the State as yet. However, Mr. P.K. Sahoo, learned Addl. Standing Counsel contended that since Petitioner's engagement is after the cut-off date so fixed by the Finance Department in its Resolution dated 15.05.1997, no illegality or irregularity can be found with the impugned rejection.

Having heard learned counsel for the Parties and considering the submission made, it is found that Petitioner was engaged as a DLR Steno in the office of Opp. Party No.3 w.e.f.24.06.1993 vide order under Annexure-1. It is not disputed by Opp. Party No. 3 that Petitioner since 24.06.1993 is continuing as a DLR Steno as on date. Placing reliance on the circular issued by the Govt.-Opp. Party No.1 on 15.12.2000, it is found that such cut-off date for such engagement of NMR/DLR in Urban local bodies has been fixed as 19.05.1997. In view of such fixation of the cut-off date, so far as the engagement of NMR/DLR in Urban local bodies is concerned, it is the view of this Court that the ground on which Petitioner's claim has been rejected vide the impugned order dated 17.09.2025 under Annexure-7 is not sustainable in the eye of law.

6.1. Therefore, this Court while quashing the said order, directs Opp. Party No.2 to take a fresh decision on the Petitioner's claim to get the benefit of regularization, taking into account the stipulation contained in the circular dated 15.12.2000, and the decision of this Court in W.P.(C) No.12548 of 2022.

6.2. This Court directs Opp. Party No.2 to take a fresh decision as directed within a period of two (2) months from the date of receipt of this order. Petitioner is permitted to provide a copy of this order along with the circular dated 15.12.2000 and judgment passed by this Court in W.P.(C) No. 12548 of 2022 as well as decisions in the case of Jaggo, Shripal, Dharam Singh as well as Bhola Nath as cited (supra) before Opp. Party No.2, for compliance.

6.3. While taking a decision so directed, relevancy and effect of the order available under Annexure-8 be also taken into consideration as it is contended that persons engaged after the Petitioner have already been regularized in the meantime.

Accordingly, the Writ Petition stands disposed of.