Delhi HC upholds end of contractual employee's tenure, says no vested Right To Continue beyond contract period

New Delhi [India], May 27 (ANI): The Delhi High Court has upheld the termination of a contractual employee's tenure with the Delhi Electricity Regulatory Commission (DERC), observing that a contractual engagement automatically comes to an end by "efflux of time" and does not confer any vested right to continue in service beyond the agreed tenure.
A Division Bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tejas Karia dismissed an appeal challenging the cancellation of his extension as Executive Assistant with DERC.

The appeal arose from an order passed by a Single Judge dismissing writ petition against an office order dated April 5, 2024, through which an earlier extension granted to him was superseded and he was relieved from service.
According to the case records, the appellant had initially been appointed on a contractual basis in December 2014 for three years. His tenure was subsequently extended on multiple occasions. In April 2021, he was again appointed for a period of three years ending on April 5, 2024.
Before the expiry of his tenure, the appellant sought a further extension till 2027. An office order dated July 31, 2023, purportedly granted the extension. However, DERC later issued another office order superseding the extension and relieving him from service after completion of his contractual tenure.
Before the Division Bench, appellant argued that the impugned office order was not merely an intimation regarding expiry of his contract, but amounted to an arbitrary withdrawal of a formal extension already granted in his favour. He contended that the withdrawal was made without assigning reasons or granting him an opportunity to hear.
He further argued that repeated extensions since 2014 had created a legitimate expectation of continuation in service and relied upon judgments of the Supreme Court and the Delhi High Court concerning protection available to long-serving contractual employees.
Rejecting the contentions, the Division Bench held that the appellant's engagement was purely contractual and subject to renewal only in accordance with the applicable DERC regulations and performance appraisal requirements.
The Court observed that the extension order relied upon by the appellant had been issued without the approval of the Chairperson and by an authority not competent to grant such an extension. It further noted that no performance appraisal had been undertaken immediately prior to renewal, as required under Regulation 5(a) of the DERC Management & Development of Human Resources Regulations.
The Bench held that since the mandatory requirements under the regulations had not been fulfilled, no enforceable contract ever came into existence for the proposed extended period from April 6, 2024, to April 5, 2027.
"The Appellant cannot assert any vested right to renewal or continuation of a contractual engagement. Mere existence of an earlier contract does not entitle the Appellant, as of right, to insist upon continuation in service," the Court observed.
The Court further held that the office order impugned by the appellant merely communicated the legal consequence of expiry of his contractual tenure and did not amount to termination of a subsisting contract. In such circumstances, neither reasons nor a prior hearing were necessary.
The Division Bench also noted that the post of Executive Assistant was not a duly sanctioned post approved by the Government of NCT of Delhi, and therefore, the judgments cited by the appellant regarding protection of long-serving contractual employees were not applicable to the facts of the case.
Holding that no infirmity existed in the Single Judge's order, the Court dismissed the appeal along with pending applications, without any order as to costs. (ANI)