A) ABSTRACT / HEADNOTE

The judgment addresses a long-standing and complex service law dispute arising from the bifurcation of the erstwhile State of Andhra Pradesh under the Andhra Pradesh Reorganisation Act, 2014. The core controversy pertained to the allocation and distribution of employees of power sector undertakings between the newly formed State of Telangana and the residuary State of Andhra Pradesh. Following the appointed day, 02.06.2014, the respective power utilities failed to reach consensus on modalities for employee distribution as mandated under Section 82 of the Act.

In the absence of agreement, the Telangana power utilities unilaterally relieved 1157 employees based predominantly on the principle of nativity, directing them to join Andhra Pradesh utilities. This action triggered multiple writ petitions before the High Court of Judicature at Hyderabad, which decisively rejected nativity as a valid criterion and quashed the unilateral action. The Supreme Court upheld the High Court’s ruling and, with the consent of parties, constituted a One-Man Committee headed by Justice D.M. Dharmadhikari (Retd.) to effectuate final allocation.

The Committee’s process culminated in a Final Report, Supplementary Report, and a Concluding Report, collectively allocating 655 employees from Telangana to Andhra Pradesh and an equal reciprocal number in the reverse direction, subject to special categories such as spouse, medical, SC/ST, and retirement cases. A series of miscellaneous applications challenged the Committee’s mandate, methodology, reciprocity principle, and finality of allocation.

The Supreme Court rejected all objections, reaffirmed the binding nature of the Committee’s conclusions, and clarified that no employee, utility, or association could challenge the finalized allocation before any forum. The judgment reinforces statutory intent, administrative equity, and finality in post-reorganisation service matters.

Keywords: Service law, State reorganisation, employee allocation, Section 82, power utilities, One-Man Committee, finality of allocation

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The dispute emanates from the structural reorganisation of the erstwhile State of Andhra Pradesh into two successor States under the Andhra Pradesh Reorganisation Act, 2014. While Sections 3 and 4 dealt with territorial bifurcation, Section 82 specifically governed the continuation and distribution of employees of State public sector undertakings. The statute envisaged that employees would continue for one year post-appointed day and that the “corporate body concerned” would determine modalities for personnel distribution.

In practice, the power utilities of Telangana and Andhra Pradesh failed to evolve mutually acceptable modalities. The Telangana utilities, acting unilaterally, relieved 1157 employees based on nativity, compelling them to report to Andhra Pradesh utilities. This administrative action disregarded statutory intent, employee options, and equitable considerations. The High Court decisively invalidated this approach, holding that nativity had no legal sanction under Section 82.

When the matter reached the Supreme Court, the Court upheld the High Court judgment and innovatively appointed a One-Man Committee to conclude the allocation process. This mechanism represented judicial pragmatism, aiming to balance competing administrative claims while respecting statutory boundaries. The Committee was expressly vested with final authority, and its decisions were declared binding on all stakeholders.

Despite this, multiple challenges emerged at various stages of the Committee’s reports. These challenges formed the subject matter of the present batch of miscellaneous applications, necessitating judicial clarification on the scope, authority, and conclusiveness of the Committee’s allocation.

D) FACTS OF THE CASE

The appointed day for reorganisation was 02.06.2014. Prior to bifurcation, the power sector comprised APGENCO, APTRANSCO, and four DISCOMs. Government Orders G.O. Ms. Nos. 24, 25, and 26 dated 29.05.2014 apportioned assets, liabilities, and sanctioned posts between the successor States.

However, no final personnel allocation followed. Telangana utilities unilaterally relieved 1157 employees, while 242 employees voluntarily moved from Andhra Pradesh to Telangana. This mass movement was justified by Telangana utilities solely on nativity, leading to litigation.

The High Court set aside the unilateral action and disapproved nativity as a criterion. The Supreme Court, while affirming this view, constituted a One-Man Committee. The Committee framed fourteen modalities grounded in statutory provisions, Government Orders, seniority, option, social justice categories, and humanitarian considerations.

A Final Report dated 26.12.2019 approved the transfer of 655 employees from Telangana to Andhra Pradesh. Subsequent objections led to a Supplementary Report dated 11.03.2020 and a Concluding Report dated 20.06.2020, completing reciprocal allocation and addressing retirement, medical, spouse, and SC/ST cases.

Despite the finality clause, numerous miscellaneous applications questioned the Committee’s authority, numerical reciprocity, post-report modifications, and alleged deviation from modalities.

E) LEGAL ISSUES RAISED

i. Whether the One-Man Committee exceeded its mandate under the Supreme Court’s order dated 28.11.2018?
ii. Whether the principle of numerical reciprocity in allocation was legally sustainable?
iii. Whether the Concluding Report lacked finality due to post-report adjustments?
iv. Whether employees could challenge the finalized allocation before any forum?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for the petitioners contended that the Committee was restricted to allocating only 1157 employees and that subsequent reciprocal allocation was ultra vires. It was argued that the Committee abandoned its own modalities and introduced extraneous principles such as financial neutrality. The petitioners asserted that Telangana, being a smaller State, was disproportionately burdened. Post-Concluding Report modifications were cited to argue absence of finality and procedural arbitrariness.

G) RESPONDENT’S ARGUMENTS

The counsels for the respondents submitted that Section 82 empowered holistic allocation and that the Committee’s remit was not numerically confined. They emphasized that reciprocity ensured balance and fairness. The respondents argued that post-report adjustments were consequential and flowed directly from agreed directions on retirement and special cases. The binding nature of the Committee’s decision was highlighted.

H) JUDGEMENT 

The Supreme Court dismissed all miscellaneous applications. The Court reaffirmed that the Committee’s authority was consensual, comprehensive, and final. It held that the liberty to seek clarification did not translate into a right of appeal. The Court upheld numerical reciprocity, validated directions excluding retiring employees, and recognized post-report adjustments as logical consequences. The Court categorically ruled that no employee or utility could challenge the finalized allocation before any forum.

a) RATIO DECIDENDI

The allocation of employees under Section 82 must be concluded through consensus or a judicially sanctioned mechanism. Once parties agree to a binding process, its outcome attains finality and is immune from collateral challenge.

b) OBITER DICTA

The Court observed that prolonged allocation disputes undermine administrative stability and employee morale, underscoring the need for timely and equitable resolution.

c) GUIDELINES

i. Allocation decisions by a judicially appointed committee are final.
ii. Nativity cannot be a determinative criterion.
iii. Retirement and humanitarian considerations may justify limited adjustments.
iv. Reciprocal allocation ensures administrative balance.

I) CONCLUSION & COMMENTS

The judgment exemplifies judicial restraint and administrative pragmatism. It reinforces statutory intent, respects consensual dispute resolution, and protects institutional stability. The ruling serves as a definitive precedent on post-reorganisation service allocation, ensuring closure to prolonged litigation.

J) REFERENCES

a) Important Cases Referred

i. Telangana Judges Association v. Union of India, SCC Online SC 1729

b) Important Statutes Referred

i. Andhra Pradesh Reorganisation Act, 2014