In this case, the Himachal Pradesh High Court addressed whether contractual computer operators, initially engaged through a society that was subsequently closed and whose functions and staff were transitioned to the Forest Department/CAMPA, are eligible for regularization under state policy. The State appealed against a single-judge order that directed the regularization of the respondents upon completion of three years of service pursuant to regularisation instructions dated 04.05.2017. The Division Bench dismissed the appeal, upholding the direction for regularization with consequential benefits. The Court held that when the State assumes the responsibilities of a defunct autonomous body and continuously utilizes the services of the same personnel for over two decades against perennial duties, it cannot arbitrarily deny them the benefit of regularization policies by raising technical pleas of separate legal entities or unequal bargaining power.
- Doctrine of Legitimate Expectation: Where contractual employees continue to discharge duties for a considerable length of time, bolstered by repeated extensions of tenure, a legitimate expectation arises that the State will recognize their long and continuous service, serving as a check against arbitrary State action.
- Substance Over Form in Employment: The nature of work performed by the respondents was perennial and fundamental to the functioning of CAMPA. Prolonged, continuous, and unblemished service transforms initial ad-hoc or temporary engagements into a scenario demanding fair regularization, and procedural labels cannot be used to perpetually deny substantive rights.
- Inequality of Bargaining Power: Courts will not enforce unfair or unconscionable clauses in standard contracts where a massive disparity in economic strength exists between the mighty State and vulnerable employees who have no meaningful choice but to sign on the dotted line for their livelihood.
- Status of State CAMPA: Although originally established as an autonomous body, State CAMPA performs governmental functions, consists primarily of government functionaries, and acts effectively as an extension of the government when absorbing the duties of a closed society due to acute staff shortages.
STPL (Web) 2026 HP 455
State of HP and Others v. Bhupinder Singh Mehta & Others (D.O.J. 17.03.2026)
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