JUDGMENT 1. :- This appeal is directed against the Judgment dated 4-12-1996 passed by the learned single Judge in S. B. Civil Writ Petition No. 4364 of 1996, whereby the writ petition filed by the petitioners-appellants was dismissed. 2. The brief facts leading to this appeal are : that the petitioners-appellants were employees of Rajasthan Small Industries Corporation in its Unit at Churu, which is a public sector undertaking. On account of the closure of the said Company, the petitioners were retrenched from service on 30-11-1994. Thereafter, on 24-12-1994, the State Govt. laid down guidelines for engaging retrenched employees of the Public Sector Undertakings on contract. The Preamble of the said Guidelines (Annexure/1) dated 24-12-1994 reads as under :It has been decided in the State Bureau of Public Enterprises Department that retrenched employees of Public Sector Undertakings may be engaged as far as possible in State Govt. Departments on contract basis. The question of framing guidelines detailing the terms of contractual appointment of such employees has been under consideration of the Govt. and the following Guidelines have been framed which are hereby circulated for the information of all the Departments of the Government :" 3. The above Preamble of the Guidelines (Annexure/1) dated 24-12-1994 goes to show that these guidelines were of general nature concerning offering appointments to employees who were retrenched from different Public Sector Undertakings within the State. 4. In pursuance of these guidelines, the petitioners were appointed as Class IV employees in the pay scale of Rs. 750-940 on contract basis for a period of five years or until completion of 58 years of age, whichever is earlier vide order (Annexure/3) dated 22-4-1995 and they were given postings at different places vide order Annexure/4 dated 28-4-1995. Their pay fixation was made vide order (Annexure/5) dated 26-5-1995. From the perusal of the order (Annexure/5) dated 26-5-1995. it appears that the pay of petitioners Jagdish Prasad Deora, Satya Narain Soni, Dalamchand Soni and Chhaganlal Sharma was fixed in the pay scale of 730-1250 whereas the pay of other petitioners viz., Ghasilal Sharma, Peeru Khan, Hariram Mali, Lai Chand Prajapat, Bhanwarlal Saint, Mustaq Khan, Satyanarain, Om Prakash Prajapat, Keshar Deo Saint, Balkrishna Sharma and Mohanlal Soni was fixed in the pay scale of 700-865. After fixation of their pay, the petitioners were getting their salary Inclusive of their basic pay, Dearness Allowance and other allowances as granted by the State Govt. from time to time. However, after about one year and four months from the date of their fixation of pay, in supersession of previous order Annexure/5 dated 26-5-1995 the petitioners were granted salary inclusive of their Basic pay and the fixed amount of Dearness as mentioned therein and Rs. 50/- per month were also ordered to be paid to the petitioners as Medical Allowance. It was also ordered that no deductions shall be made from the salary of the petitioners and if any amount is paid in excess to above, the same was ordered to be recovered. 5. Against this order (Annexure/6) dated 9-9-1996, the petitioners made representations to the respondents but when nothing was done in the matter, they preferred S. B. Civil Writ Petition No. 4364 of 1996 before this Court inter alia seeking 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 : 6. The writ petition filed by the petitioners came to be dismissed by the learned single Judge vide his Judgment dated 4-12-1996 while holding that the petitioners have consciously taken up the contract on the terms mentioned in Annexure/1, the circular dated 24-12-1994 and the order dated 9-9-1996 is in pursuance of the contract and consequently if there is any injury caused, it is a contractual injury for which remedy is not a writ petition. Being dissatisfied with the impugned Judgment dated 4-12-1996 passed by the learned single Judge, the petitioners have preferred this appeal. 7. Being dissatisfied with the impugned Judgment dated 4-12-1996 passed by the learned single Judge, the petitioners have preferred this appeal. 7. During the course of hearing arguments, an application was moved by the learned counsel for the petitioners-appellants seeking amendment in the writ petition placing on record and order dated 9-3-2000 whereby it has been ordered that since the petitioners were appointed on contract basis for a period of 5 years and that term came to an end on 25-4-2000 or 26-4-2000, as the case may be. their services shall stand terminated. The petitioners have also sought the relief for setting aside this order dated 9-3-2000. 8. We have heard the learned counsel for the appellants as well as the learned counsel for the respondents. We have also gone through the record of the case. 9. It has been contended by the learned counsel for the appellants that the order under appeal does not notice the fact that primarily the petitioners were challenging the order Annexure/6 dated 9-9-1996 passed by respondent Chief Medical & Health Officer, Ratangarh as an officer of the State altering the terms of appointment which was offered to them vide orders Annexures 3 and 5 dated 22-4-1995 and 26-5-1995 without affording any opportunity of hearing to the petitioners affecting their rights adversely. The Impugned order Annexure/6 dated 9-9-1996 not only resulted in reduction in their pay but also effected recoveries from their salaries. According to the learned counsel, once the appointment has been offered by the State Govt. whether under the Rules or under the Contract, it becomes an employer and thus, the State is under an obligation to act fairly and without any trails of arbitrariness and unreasonableness in its action. It is under an obligation to adhere to the principles of natural justice before passing any adverse order against any of its employees. Therefore, the dismissal of the writ petition on the ground that this petition is for enforcement of contractual rights is not maintainable, was not justified. 10. Even on merits of the case, it has been urged by the learned counsel for the appellants that the petitioners-appellants were appointed as Peons against existing regular posts under the respondents and they were also discharging the duties as any other employee appointed under the Rules is to discharge those duties of the post. 10. Even on merits of the case, it has been urged by the learned counsel for the appellants that the petitioners-appellants were appointed as Peons against existing regular posts under the respondents and they were also discharging the duties as any other employee appointed under the Rules is to discharge those duties of the post. In these circumstances, the respondents could not offer lesser emoluments against salary for discharge of the same duties of the very same posts to different persons on the basis of the manner of their appointments. In this case, it is not the question of discharging duties of similar posts carrying similar duties in respect of any comparable posts needing an enquiry under that question. Therefore, offering of emoluments less than regularly appointed persons on the posts, even if appointments of the petitioners can be considered to be a fixed term appointment, is not permissible. It was also pointed out that appointment having been made on contractual basis and salary is fixed in the pay scale in which appointments have been offered, it must be held that on offering five years contractual appointments, the emoluments payable under the contract have been fixed vide order (Annexure/5) dated 26-5-1995 and there was no mistake in that order. What emoluments were to be fixed, has not been prescribed in the guidelines. The Guidelines (Annexure/1) dated 24-12-1994 only prescribes for appointments on contractual basis and with regard to fixation of contractual emoluments, it has been provided that the Govt. shall take into consideration the last pay drawn by the retrenched employee and the contractual emoluments shall not exceed the last pay drawn by such retrenched employee. According to the learned counsel, it is not the case in the order under challenge that by order Annexure/5 dated 26-5-1995, emoluments have been fixed exceeding the last pay drawn by the petitioners-appellants. 11. It was also urged that employment on contract basis for a fixed term of 5 years or till the contracted retrenched employee attains the age of 58 years whichever is earlier, is also contrary to the right of equality in the matters of employments and, therefore, the Guidelines Annexure/ 1 dated 24-12-1994 must be held to be ultra vires. 12. On the other hand, Mr. 12. On the other hand, Mr. S. G. Ojha, the learned counsel for the respondents urged that the impugned order Annexure/6 dated 9-9-1996 is in accordance with the Circular Annexure/1 dated 24-12-1994 and since, it relates to the terms of contract, no relief can be granted to the petitioners. It was also urged that since it was a case of offering employment to the persons, who had already lost their jobs, on certain terms and conditions, it being a matter of policy, cannot be substituted by treating the retrenched employees to be surplus employees. In order to appreciate the controversy involved in the present case, it would be appropriate to reproduce clauses (4), (5), (6), (7), (8), (9) and (15) of the Guidelines Annexure/1 dated 24-12-1994 in extenso : (4) Since this is a contractual appointment, the past services rendered by such retrenched employees under the parent public sector undertaking shall have no relevance or continuing of service benefits with the contract appointment under the Govt. (5) The initial period of contract appointment would be for 5 years or till the retrenched employee attains 58 years of age, whichever is earlier. (6) The contract period may be renewed by the appointing authority, provided during the period of contract the work and the conduct of the employee has been found satisfactory, but not beyond 58 years of age. (7) While fixing the contract emoluments, the Govt. shall take into consideration the last emoluments drawn by the retrenched employee and the contracted emoluments shall not exceed the emoluments last drawn by the employee at the time of retrenchment. (8) The contract can be terminated by giving prior notice of one month from either side. (9) The retrenched employee may be engaged on contract on an equal or lower post held by him before retrenchment. In the event of his being engaged on lower post, his total emoluments will not exceed the maximum of the post. There will be an upper age relaxation for the retrenched employees seeking contract appointment. (15) To compensate for Medical facilities, the employees engaged on contract basis in the Government shall be allowed a Medical Allowance of Rs. 50/- per month." 13. There will be an upper age relaxation for the retrenched employees seeking contract appointment. (15) To compensate for Medical facilities, the employees engaged on contract basis in the Government shall be allowed a Medical Allowance of Rs. 50/- per month." 13. It cannot be gainsaid that these guidelines have been issued for the purpose of giving relief to the employees of different Public Sector Undertakings, who have been retrenched from their respective undertakings and have also lost their job. These guidelines do not contain a scheme for absorption of retrenched employees of different public undertakings as surplus employees to corresponding or equal or equivalent or lower regular posts. This scheme has been framed only with a view to provide rehabilitation relief to those retrenched employees of different Public Sector Undertakings, who lost their job. Thus, offering employment on contract basis for a fixed term cannot be said to be either unreasonable or arbitrary on any count. The term providing employment for a fixed term or till the attainment of age of 58 years also cannot be said to be unreasonable or arbitrary. The petitioners with their open eyes have accepted the offer of appointments on fixed term or till the attainment of age of 58 years and acceptance of offer was not compulsory and, therefore, it cannot be said to be detrimental to the retrenched employees. It is absolutely on the will of the retrenched employees to accept or not to accept the offer of appointment given to them on contract basis for a fixed term of 5 years or till the attainment of age of 58 years, whichever is earlier. We are therefore, unable to accept the contention of the learned counsel for the appellant that the guidelines Annexure/1 dated 24-12-1994 is ultra vires the Constitution of India. 14. However, we find merit in the contention of the learned counsel for the petitioners appellants that it cannot be said to be a case for enforcement of contractual terms. Whether appointment has been offered through regular recruitment process under the rules or it has been offered on contract basis under the Guidelines (Annexure/ 1) dated 24-12-1994, the State does not cease to be an employer or bear different character as an employer so as to shed constitutional duty to act justly and fairly in all its spheres of activity. Once the appointment has been offered by the State Govt. Once the appointment has been offered by the State Govt. whether under the Rules or under the Contract, it becomes an employer and thus, the State is under an obligation to act fairly and without any trails of arbitrariness and unreasonableness in its action. Moreover, in the instant case, the challenge is not with regard to enforcement of any terms of contract agreement but the only action of the State Govt. in withdrawing the emoluments, which were already granted to the petitioners, detrimental to the their interest is under challenge. The emoluments have been withdrawn without any notice or without affording any opportunity of being heard to the petitioners, vide order Annexure/6 dated 9-9-1996. The order Annexure/6 dated 9-9-1996 having been made in breach of principles of natural justice and resulting in recovery of the payments already made with reduction in future emoluments, in our opinion, cannot be upheld. Therefore, the order Annexure/6 dated 9-9-1996 which has been passed in utter disregard and violation of the principles of natural justice, it deserves to be set aside and quashed. 15. 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. 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 employees 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 depend on executive order for its determination. The order Annexure/6 dated 9-9-1996 deserves to be set aside and quashed on this ground also. 16. Now coming to the relief claimed against the notice dated 9-3-2000 regarding termination of services of the petitioners with effect from 25-4-2000/26-4-2000 as the case may be, we are of the opinion that if the clauses (5) and (6) of the Guidelines (Annexure/1) dated 24-12-1994 are read together, the scheme appears to be clear that in the first instance, appointments for a fixed term of 5 years or till the attainment of 58 years of age, whichever is earlier is to be offered and thereafter, the contract period may be renewed by the appointing authority provided during the period of contract the work and conduct of the employee has been found to be satisfactory but not beyond 58 years of age. Therefore, in view of clauses (5) and (6) of the Guidelines (Annexure/ 1) dated 24-12-1994, upon completion of 5 years of term appointment, the State Govt. was/is under an obligation to consider the cases of the appellants for renewal of their contract period on the basis of satisfactory conduct and work of the employees during the contract period. The Guidelines nowhere provide that upon completion of five years term appointment, the services shall stand terminated automatically. In these circumstances, it would be just and proper to direct the State Govt. to consider the cases of the petitioners for renewal of their contract appointments in view of clause (6) of the Guidelines (Annexure/1) dated 24-12-1994. 17. The Guidelines nowhere provide that upon completion of five years term appointment, the services shall stand terminated automatically. In these circumstances, it would be just and proper to direct the State Govt. to consider the cases of the petitioners for renewal of their contract appointments in view of clause (6) of the Guidelines (Annexure/1) dated 24-12-1994. 17. Accordingly, this appeal is allowed and the impugned judgment under appeal dated 4-12-1996 passed by the learned single Judge in S. B. Civil Writ Petition No. 4364 of 1996 is set aside. The orders dated 9-9-1996 and 9-3-2000 are set aside and the respondents are directed to consider renewal of contract appointment of the petitioners in view of clause (6) of the Guidelines Annexure/1 dated 24-12-1994. 18. The parties are left to bear their own costs.Appeal Allowed. *******