State Must Be Impleaded For Relief Against Public Exchequer: Supreme Court

The Supreme Court has held that a writ petition or suit seeking substantive relief against the State is fundamentally defective and not maintainable if the State is not formally impleaded as a party. Mere representation of the State through its officers does not cure the defect, Court said.

A Bench of Justices Dipankar Datta and Sheel Nagu said that where a litigant seeks relief involving the public exchequer or a declaration of rights in respect of State property, the State is a necessary party to the proceedings.

Defective writ petition 

Court made the observation while dealing with an appeal arising from a dispute over the appointment and subsequent termination of a lecturer in Maharashtra. It held that the writ petition filed by the lecturer before the Bombay High Court was fundamentally defective because the State of Maharashtra had never been formally impleaded as a party.

Court also rejected the lecturer’s claim for absorption on the ground that another similarly placed lecturer had allegedly received the benefit. It held that Article 14 of the Constitution (equality before law) does not envisage “negative equality”, meaning a person cannot claim an illegal or irregular benefit merely because it was granted to someone else.

The State of Maharashtra had challenged the Bombay High Court's judgments dated October 7, 2015 and January 12, 2016.

The dispute

The dispute concerned respondent Sudhir’s appointment as a Lecturer in the Commerce Faculty of a college during the 1990-91 academic session. The college had been permitted to operate strictly on a “no grant-in-aid basis”.

Sudhir was terminated from service on August 17, 1999. Around the same time, the University permitted the college management to close down the Commerce Faculty from the 1999-2000 academic session due to lack of students.

Sudhir challenged his termination before the University and College Tribunal, Nagpur. The tribunal dismissed his appeal on April 24, 2000, following which he approached the high court.

The high court set aside the tribunal's order and quashed Sudhir’s termination. It also directed the Joint Director to take steps to include his name in the list of surplus lecturers/teachers and absorb him in another college. The high court further directed the Management to pay him Rs 10 lakh as compensation in lieu of arrears.

The State challenged these directions, arguing that the policy for absorption of surplus lecturers/teachers applied only to grant-in-aid colleges. It contended that the high court had exceeded its jurisdiction by directing Sudhir’s absorption contrary to the applicable policy.

Sudhir, on the other hand, relied on Section 79(4) of the Maharashtra Universities Act, 1994, arguing that the provision required absorption of surplus lecturers/teachers from all affiliated colleges without distinguishing between aided and unaided institutions. He also relied on the absorption of another lecturer, Bhaurao s/o Pundlikrao Kadav, to claim parity.

Court said the first and fundamental problem with Sudhir’s case was that the State of Maharashtra had not been made a party to the writ proceedings.

Court noted that it was only in March 2015, nearly 15 years after the writ petition was filed, that Sudhir sought to implead the “Joint Director” as the sixth respondent. Even then, the State itself was not formally impleaded.

Sudhir argued that the writ petition was nevertheless maintainable because the State was represented through the office of the Joint Director and an Assistant Government Pleader had contested the matter on merits.

Court rejected this argument.

“The contention, however, overlooks the settled position of law that the State, as the necessary party, should have been duly impleaded in the proceedings; mere representation through one of its officers cannot dispense with such impleadment,” the Bench said.

It explained that the State is a juristic entity under Article 300 of the Constitution (suits and proceedings involving the government) and cannot be equated with one of its officers or departments when substantive or financial liability is sought to be imposed on it.

“The impleadment of an officer or a department, without formally arraying the State as a juristic entity under Article 300 of the Constitution, renders the petition fundamentally defective when substantive relief is sought against the public exchequer,” Court held.

The Bench further said that the belated impleadment of the Joint Director did not cure the defect. An officer or department of the State cannot be treated as the State itself for the purpose of fastening sovereign or financial liability.

It therefore held that the high court had erred in directing the State to absorb Sudhir without the State having been formally impleaded as a necessary party.

Court said that even otherwise, Sudhir’s claim for absorption could not be sustained on merits.

It noted that Sudhir's appointment was undisputedly in a “no grant-in-aid” college. This placed him outside the State's surplus absorption policy, as clarified by the corrigendum dated March 21, 1997. Sudhir had not challenged the corrigendum.

Court said that in the absence of a challenge to the corrigendum, reliance on the Maharashtra Universities Act could not assist Sudhir in bypassing the executive policy.

The Bench also rejected his reliance on the case of another lecturer who had allegedly been absorbed.

Despite rejecting Sudhir’s legal claims, Court took note of the circumstances in which he had remained out of employment.

Court noted that Sudhir had “battled the sword of Damocles” over his employment since 1993 and had reached the age of superannuation on November 30, 2025, while the proceedings were still pending.

Because of the stay operating during the proceedings, he could not enjoy the benefit of the reinstatement order passed by the high court. He had also accepted Rs 10 lakh from the Management as lump-sum compensation in lieu of arrears, apparently on the expectation that he would eventually be absorbed as directed by the high court.

Noting that Sudhir had remained out of employment since 1999, Court said, “We are of the view that Sudhir may not be left without any succour at the twilight of his life.”

Invoking its extraordinary powers under Article 142 of the Constitution, Court therefore directed the State of Maharashtra to pay Sudhir a consolidated sum of Rs 10 lakh within eight weeks, in full and final settlement of all his claims.

Court clarified that the Rs 10 lakh compensation already paid by the Management would remain undisturbed.

Case Title: State of Maharashtra Vs Sudhir S/o Motiramji Hiwarkar & Ors

Bench: Justices Dipankar Datta and Sheel Nagu 

Date of Judgment: October 13, 2026