JUDGMENT 1. - By this writ petition under Article 226 of the Constitution of India the petitioners have prayed for issuance of a writ, order or direction to suspend the Rajasthan State Electricity Board and to quash the notification constituting the Rajasthan State Electricity Board which consists of Chairman and various members. It is also prayed that the re-appointment order dated 7th August, 1987 of Shri R. C. Dave as Member and Chairman of the said Board be quashed. 2. Briefly stated the facts of the case are that petitioner No. 1 is an association recognised by the Rajasthan State Electricity Board (for short, the respondent Board) of the engineers working in the respondent Board and Shri R.C. Kaushik, petitioner No. 2, is the president of the Rajasthan State Electricity Board Engineers Association The main object of the petitioner Association is to work in the interest of the respondent Board and watch the interest as also to watch the interests of the members in respect of their service conditions and general well being. Section 5 of the Indian Electricity (Supply) Act, 1948 (for short, the Act) provides for constitution and composition of State Electricity Boards. Sub section (1) of Section 5 of the Act provides that the State Government shall after issue of Notification in the State Government shall after issue of Notification in the Official Gazette a State Electricity Board under such name as shall be specified in the Notification Rajasthan State Electricity Board was constituted by the Rajasthan Government vide its Notification No F.11 (OWD)/57 dated 28th January, 1957 Sub-section (2) of section 5 of the Act provides that the respondent Board shall consist of not less than 3 and not more than 7 members appointed by the State Government Sub-section (4) of section 5 of the Act provides that - (a) One member snail be a person who has experience of and has shown capacity in commercial matters and administration; (b) One member shall be an electrical engineer with wide experience; and (c) One member shall be a person who has experience of accounting and financial matters in a Public Utility Undertaking preferably an Electricity Supply Undertaking. 3. Sub-section (4), thus, provides that three members have been mentioned therein, must have qualification and experience as stated in sub-clause referred to above in (a) (b) and (c) The respondent Board is composed of seven members.
3. Sub-section (4), thus, provides that three members have been mentioned therein, must have qualification and experience as stated in sub-clause referred to above in (a) (b) and (c) The respondent Board is composed of seven members. Their names and qualifications are as follows:- 1. Shri R.C. Dave, Chairman as Technical Member. 2. Shri K.S. Das Chowmick, Member Finance and Accounts. 3. Shri S.S. Vyas, Technical Member (Transmission and Distribution). 4. The Energy Secretary, Government of Rajasthan. 5. Finance Secretary, Government of Rajasthan. 6. Industries Secretary, Government of Rajasthan. 7. Shri C.D. Mathur (Appointed on 20/11/1987). 4. In view of the facts, as stated by the petitioners themselves, it is stated by them in the writ petition that out of the three members, two are from the technical services, They are Shri R.C. Dave and Shri S.S. Vyas and, thus, they belong to the category of Sub-clause (b), as mentioned in Subsection (4) of Section 5 of the Act. It is further stated that there is no member who could be said to belong to the category of sub-section (4) (a) of Section 5 of the Act. This category provides that a person who has experience of and has shown capacity in commercial matters and administration shall be one of the members on the Board. The case of the petitioners is that the State Government has not appointed any member of category (a) as provided under sub-section (4) of Sec. It is further the case of the petitioner that the State Government has not appointed any member from the petitioner Association representing the employees as such and has also not appointed by member representing the Users, likewise voluntary organisations. The petitioners have further contended that the nomination of three Secretaries, namely Industries Secretary, Finance Secretary and Energy Secretary as members on the Board is illegal and contrary to the provisions of Sections 5 and 8 of the Act. It is further contended that ex- officio appointments lack personal scrutiny, investigation and check up and thus ex-officio appointments are ultra vires the various provisions of Section 3, 5, 8, 9, 10 and 1l and the rules. Such appointment is mechanical in nature. The ex-officio appointments have been challenged on the ground that frequent changes take place in regard to the persons occupying the offices of various Secretaries, as mentioned above.
Such appointment is mechanical in nature. The ex-officio appointments have been challenged on the ground that frequent changes take place in regard to the persons occupying the offices of various Secretaries, as mentioned above. Normally, a member is appointed for a period of three years and if ex officio appointments are allowed the very object of appointment of a member will be frustrated. The petitioners have also challenged the appointment of part time members contending that such appointments are ultra vices the provisions of the Act and the Rules. The petitioners have challenged the re-appointment of Shri R.C. Dave on the ground that the State Government has not prescribed any condition when a re-appointment is to be made. The submission of the petitioners is that in the absence of the rules power is likely to be exercised arbitrarily, unreasonably and capriciously. It is, thus submitted that the re-appointment of respondent No. 2, Shri R.C. Dave, as a Technical Member and his re-appointment as Chairman are per se bad and unreasonable. It is also stated that the satisfaction of the Government is not available in any manner whatsoever in so far as the necessity of extension/re-appointment, is concerned. The petitioners have further pleaded that re-appointment and extension of respondent No. 2 as Technical Member and then as Chairman II completely arbitrary and unreasonable when the Board is incurring losses years after year. It has been contended that the Board is incurring heavy losses right from 1981-82 upto 1986-87. The losses in the year 1981-82 were to the tune of Rs. 3,703 lacs and it became to Rs. 6,354 lacs in the year 1986-87. Similar is the position with regard to the outstanding dues against the supply of power. The arrears to be recovered have mounted up in the regime of Shri R.C. Dave. The extension/ re-appointment of Shri R.C. Dave h is further been challenged on the ground that Shri R.C. Dave has been guilty to many mal-practices and acts of misfeasance and mal-feasance and the matters which pertain to the character of not only mis-management of finances and property of the Board but they go to the extent of coming within the purview of misappropriation.
It is further contended by the petitioners that a prima facie case of corruption was made out against Shri R.C. Dave in the matter of purchase of transformers at a high price from Rajasthan Power Equipments and Rajasthan Electrical World The petitioners have also alleged charges of nepotism and favouritism against Shri R.C. Dave. It is further stated by the petitioners that Shri R.C. Dave is disqualified to be a Chairman of the Board, as admittedly he is Director of M/s. Modern Insulators Pvt. Ltd. Section 9 of the Act provides that the members shall not hold any interest in certain concerns Further it is alleged that Industries Secretary is Director of Man Structural Ltd. and Jaipur Udyog which deal in supply of electrical and engineering goods which are needed by the Board for various purposes he is therefore disqualified. 5. The respondents have filed different replies. In the reply filed by respondent No. 1, all the allegations made by the petitioners have been denied. The respondent Board has submitted that the petitioners have not come with clean hands and the writ petition is not bona fide. It is actuated by malice ill- will, vengeance, vindictiveness and personal pique. The allegations against Shri R.C. Dave have been made by trotivated persons wreaking vengeance. Since the office-bearers of petitioner No. 1, viz., President and Secretary, were charge-sheeted for serious acts of misconduct during the tenure of Shri R.C. Dave as Chairman and these charges were not withdrawn. The allegations of corruption against Shri R. C. Dave are nothing but an attempt to sensationalise and to extract publicity mileage, besmirching the untarnished image of a highly respectable officer. Respondent No. 1, Rajasthan State Electricity Board @ has further stated that all the appointments are in order. Respondent No. 1 has also stated that the grievance of the petitioners regarding invalidity of ex officio appointments under Section 5(4) of the Act has already been removed in view of the Notification published on 2nd January, 1988, although, the Board as constituted even prior to 2nd January, 1988, was valid in law. It is further stated that each of the three ex officio members, Finance Secretary, Industries Secretary and Energy Secretary, have experience of and have shown capacity in commercial matters and administration as is required under Section 5(4) (a) of the Act.
It is further stated that each of the three ex officio members, Finance Secretary, Industries Secretary and Energy Secretary, have experience of and have shown capacity in commercial matters and administration as is required under Section 5(4) (a) of the Act. It is further mentioned by respondent No. 1 that the Chairman, Rajasthan State Electricity Board has also the same qualifications as he has experience of and has shown capacity in commercial matters and administration. Respondent No. 1 has also pleaded that the appointing authority has wide and ample discretion in the matter of appointments and the Court would not substitute its command in regard to ability, capacity and experience of the appointees. As regards disqualification under Section 9 of the Act, it is submitted that Shri R.C. Dave was not at all interested in remaining as Director of M/s. Modern Insulator Ltd. and that in fact he has now resigned. Therefore, this ground no more survives. It is further asserted by respondent No. 1 that the spirit of Section 9 is clearly intended to prohibit or regulate the conflict of any private or personal interest with the function of the Government nominee appointed to any firm or company i.e. the interest or benefits must be private and personal in nature further Shri R.C. Dave does not own or control a single share of M/s. Modern Insulators Ltd. and further more he is only a nominated Director of the Company and has been so nominated by RIICO, which is a Government Company under the Companies Act. In the same way, respondent No. 1 has submitted that the submission in respect of validity of appointment of Shri R.C. Dave as Director of M/s. Modern Insulator would apply mutatis mutandis and propriovigore, in respect of Directorships held by the Industries Secretary in M/s. Man Structurals Ltd. and in M/s Jaipur Udyog. As regards the charges of corruption in the matter of supply of transformers, respondent No. 1 submitted that the matter was examined by the then Director, ACD, Dr. Pilania and he was of the opinion that no case is made out against Shri R.C. Dave and it was further confirmed by Shri Dutt Director, ACD and the preliminary enquiry was closed it 23rd August, 1986 by the ACD.
Pilania and he was of the opinion that no case is made out against Shri R.C. Dave and it was further confirmed by Shri Dutt Director, ACD and the preliminary enquiry was closed it 23rd August, 1986 by the ACD. As regards the challenge to the extension of term of respondent No. 2 as also his reappointment as Chairman, it is submitted that respondent No 2 was re-appointed as Member Technical/Chairman of the the Board vide notification dated 7th August, 1987 for two years with effect from 11th August, 1987. This was done by the Government after being fully convinced and fully satisfied that the re-appointment of respondent No. 2 was in public interest. 6. Respondent No. 1 has also raised certain preliminary objections. Respondents No. 3 and 5 and 8 to 10 have also submitted their separate written statements. In the written statements, the respondents have mainly contended that no writ petition lies as it is not a case where there is any violation of fundamental rights or violation of basic human rights. They also submitted that it is an abuse of the process of law that such a petition as public interest litigation has been filed. Respondents have stated that Shri R.C. Dave possesses experience as an eminent technical engineer and he has shown his capacity as competent administrator as Chief Engineer and as Member Technical and also as Chairman. He possesses a long experience of and has shown capacity in dealing with commercial matters when he was dealing with transmission and distribution. They have also stated that apart from it, by Notification dated 11th December, 1987, Shri T.C. Ramanan, Shri N.S. Susodia and Shri B.L. Sharma have been appointed as Members of the Board in exercise of powers under Section 5(4) (a) of the Act, which was published in the Extra-ordinary Gazette dated 2nd January, 1988. Thus, there is full compliance in respect of the provisions of Clauses (a), (b) and (c) of Section 5 (4) of the Act. As regards part time members, it is contended by the respondents that part time members are appointed in accordance with the provisions of the Rajasthan State Electricity (Supply) Rules, 1963.
Thus, there is full compliance in respect of the provisions of Clauses (a), (b) and (c) of Section 5 (4) of the Act. As regards part time members, it is contended by the respondents that part time members are appointed in accordance with the provisions of the Rajasthan State Electricity (Supply) Rules, 1963. They have also submitted that Shri R.C. Dave was given re-appointment by orders dated 6th August, 1985 and 7th August, 1987 and he was so appointed when the Government was fully satisfied that his re-appointment is in the interests of the Board and the State. As regards charges of corruption it is contended by the respondents that when the re-appointment was ordered, the preliminary enquiry had already been closed. The Director General was of the opinion that the explanation of Shri R.C. Dave appears to be plausible when there is no definite proof of any mala fides against him Respondent No. 7, Shri S.S. Vyas has also filed a separate reply. Respondent No. 2 has filed reply in the form of affidavit 7. There is no dispute between the parties that vide Notification dated 6th August, 1985, respondent No. 2 was appointed as Technical Member for a further period of two years from 11th August, 1985 to August 10, 1987 and vide Notification dated 6th August, 1985 (Annx. 2) he was re-appointed as Chairman for a period of two years with effect from 11th August, 1985. The period of two years from 11th August, 1995 expired on 10 August, 1987 and vide Notification dated 7th August, 1997, respondent No. 2 was again appointed as Technical Member and Chairman of the Board for two years wish effect from 11th August, 1997, the writ petition was filed in July, 1987. The petitioners, thus approached this Court when barely three weeks or so of Shri A.C. Dave's term under Notification dated 6th August, 1985 were left. It was because of the change in the circumstances that the writ petition was amended by the petitioners. The amended writ petition was filed and subsequently the respondents were allowed to file their amended returns. 8. From the appreciation of the facts as stated above, it would be evident that the petitioners have challenged the appointment of the members of the Board and the appointment of Shri R.C. Dave as Chairman and his reappointment. 9.
The amended writ petition was filed and subsequently the respondents were allowed to file their amended returns. 8. From the appreciation of the facts as stated above, it would be evident that the petitioners have challenged the appointment of the members of the Board and the appointment of Shri R.C. Dave as Chairman and his reappointment. 9. The main grounds of attack in this regard are as follows : 1. That all members of the Board should be whole time members and that no member of the Board can be appointed ex-officio. 2. That there is no member on the Board who fulfills the requirement of Section 5(4) (a) of the Electricity (Supply) Act, 1948 inasmuch as there is no member on the Board who possesses the experience of and has shown capacity in commercial matters and administration. 3. That the members of the Board were disqualified on account of the mandate of Section 9 of the Electricity (Supply) Act, 1948, which provide that no member of the Board shall hold interest in any firm or company carrying on the business of supply of electricity or in fuel for the generation of electricity or of the manufacture sale or hire of machinery, plant equipment, apparatus or fittings for the generation, transmission, distribution or use of electricity or any interest in the managing agency or shares of securities of any such company and as such a member is liable to be suspended or removed under Section 10 of the Act. 4. That charges of corruption have been made against Shri R.C. Dave and when charges of corruption and favouritism have been made against Shri R.C. Dave and when the Board suffered heavy losses during the tenure of Shri R.C. Dave. In August 1987, it was neither reasonable nor proper to re-appoint him and this act of the Government was mala fide and invalid. The reappointment fails to satisfy the test for its validity on the touch-stone of reasonableness and public interest. 10. Learned counsel for the parties elaborately argued on the above-mentioned grounds. They have supported their contentions on the basis of certain authorities. We have carefully considered the submissions made by the learned counsel for the parties. We have also perused the record and have gone through the written submissions also. We will, now, deal with the grounds of challenge in the order, as given above. 11.
They have supported their contentions on the basis of certain authorities. We have carefully considered the submissions made by the learned counsel for the parties. We have also perused the record and have gone through the written submissions also. We will, now, deal with the grounds of challenge in the order, as given above. 11. The first ground of challenge is that a member of the Board should be whole time member. In our opinion, there is no substance or merit in this contention. A careful study of the Rajasthan Electricity (Supply) Rules, 1963 provides that there is not only no prohibition express or implied in the Act, but the said Rules expressly postulate the possibility of members being whole time and members being part time. The rules provide for leave and leave salary. It provides that if the Chairman and the whole time members of the Board are Government Officers, they shall be entitled to such amount of leave, including casual leave as is permissible to them under the provisions of the Rajasthan Service Rules or the Service Rules of the Board, as the case may be, Rule 7(e) expressly predicates the possibility of part time members by providing that part time members shall not he entitled to any leave except that their casual absence from meeting may he executed by the Board. Learned counsel for the Board has placed reliance on (1) Uttar Pradesh State Electricity Board, Lucknow v. Seth Ram Gopal & partners, 1965 ALJ 187 , wherein a similar contention was raised as has been raised by the petitioners in this writ petition, and the said contention was repelled by the Division Bench of the Allahabad High Court. The Allahabad High Court in that case upheld the appointment of Shri B.B. Lal ICS, Secretary, Irrigation Department, U.P. Government as Chairman of the U.P. State Electricity Board. This appointment was part time because Shri B.B. Lal was the Secretary, Irrigation Department at that time. It was assailed, inter alia, on the ground that "the Board is an authority independent of and separate from the Government; that the Government has to exercise financial and administrative control over the Board and that if the same person incharge of the Board is also the departmental head of the Government, then the control cannot be exercised effectively".
It was assailed, inter alia, on the ground that "the Board is an authority independent of and separate from the Government; that the Government has to exercise financial and administrative control over the Board and that if the same person incharge of the Board is also the departmental head of the Government, then the control cannot be exercised effectively". The Division Bench repelled and held that there is no implied prohibition against the appointment of Secretary to the Government as Chairman in the provisions of the Supply Act. 12. The another limb of ground of attack is that no member of the Board can be appointed ex-officio. In our opinion, this ground of attack no more survives in view of the Notification dated 11th December, 1987, published on 2nd January, 1988, whereby three members of the Board have been appointed by name. This has thus removed the grievance of the petitioners in this regard. Even otherwise also, the ex officio appointment of the members is not bad. There are three members. They are Finance Secretary, Industries Secretary and Energy Secretary. Section 15 of the General Clauses Act reads as follows : "15. Power to appoint to include power to appoint ex-officio - Where by any Central Act or Regulation, a power to appoint any person to fill any office or execute any function is conferred then unless it is otherwise expressly provided any such appointment if it is made after the commencement of this Act, may be made either by name or by virtue of office." 13. In view of Section 15 of the General Clauses Act referred to above, it is permissible to appoint-re-appoint members ex officio. It is clear that it is an express provision which applies to all Central Acts and it clinches and concludes the entire matter in issue in this regard. Reference may be made in this connection to the following cases : (2) Choithram Parasaran V. State of Gujarat, ( AIR 1967 SC 1532 ) . (3) Abdul Hussain v. State of Gujarat, ( AIR 1968 SC 432 ) . (4) Emperor v. Savalaram, (AIR 1948 Bom. 156) . 14. In our opinion, in view of the fact that the three members of the Board have been appointed by name by Notification dated 11th December, 1987, published in the gazette on 2nd January, 1988 this ground of attack also becomes infructuous. 15.
(4) Emperor v. Savalaram, (AIR 1948 Bom. 156) . 14. In our opinion, in view of the fact that the three members of the Board have been appointed by name by Notification dated 11th December, 1987, published in the gazette on 2nd January, 1988 this ground of attack also becomes infructuous. 15. As regards challenge to the validity of the Rules, we may observe that there are no cogent grounds for declaring Rule 7 to be ultra vires. The contention of Sri C.K. Garg is that creation of different categories of members as that of whole-time and part-time is ultra vires the powers vested in the Government. Further submission of Shri Garg is that the part-time members who are directly under the control and subordit alien of the Government is not keeping in view of the principles on which autonomous bodies function as ex-officio members will always act at the instance of and dictates of the Government and may not allow his personal ability and talents and expert knowledge to bear upon the various decisions and resolution which the respondent Board may have to pass. We are not impression with this argument There is no implied prohibition against appointment of the Secretaries to the Government as members of the Board. No such prohibition can be spelled out from the provisions of the Act. Section 15 of the General Clauses Act makes it clear that power to appoint includes power to appoint ex officio, unless it is otherwise expression provided. It is an admitted position that there is no such impediment in the Act, and if the rule prescribes for appointment of whole-time or part-time members it cannot be said that the rule is ultra vires. On the other hand, there are special and particular provision in Chapter II with regard to whole-time members and such provisions are conspicuously absent in Chapter-III, to show that the Act does not mandate that all the members of the Board shall necessarily be whole time members The very juxtaposition of Chapter-II and Chapter III in the Act shown that there is no merit in the contention of the petitioners. The proposition that a Secretary to the Government may be appointed as member or chairman of the Board gets support from UPSC Board v. Seth R. Gopal (1965 ALJ 187) . Than, in our view Rule 7 is valid. 16.
The proposition that a Secretary to the Government may be appointed as member or chairman of the Board gets support from UPSC Board v. Seth R. Gopal (1965 ALJ 187) . Than, in our view Rule 7 is valid. 16. The second ground of attack is that there is no member on the Board who fulfills the requirement of Section 5 (4) (a) of the Electricity (Supply) Act. 1948. In fact, the main ground of challenge of Shri C.K. Garg, learned counsel for the petitioners, was that the object and scheme of the Act postulate that no part time or ex officio member can be appointed. We have already held that it is permissible to appoint ex officio members. If this be the position, then it cannot be disputed that each of the three such appointees fulfills the requirement of Section 5 (4) (a) of the Act. In the returns filed by the State and the Rajasthan state Electricity Board, it has clearly been stated that these three ex officio appointees have experience of and have shown capacity in the commercial matters and administration. In the return filed by the Board, it has been pleaded that apart from primarily of being of category (b) of sub-section (4) of Section 5 of the Act, Shri R.C. Dave fulfills the requirements of experience and capacity under Category (a) of Sub-section (4) of Section 5 also. It may be true, but he was appointed specifically under the category (h) of Section 5 (4) and was never appointed under category (a) of Section 5 (4). However, the three Secretaries, namely Energy Secretary. Finance Secretary and Industries Secretary who are appointed by the Government as Members of the Board vide Notification dated l1th March, 1987 upto 31st December, 1988 have been appointed under Sec, 0.5 (4) of the Act. Shri R. C. Dave in his affidavit has deposed that these members of the Indian Administrative Service on the Board have the qualifications as laid down in Sub-sec. (4) (a) of Section 5 (4) of the Act. Shri R.C. Dave in his affidavit has referred to the names of Shri T.V. Ramanan.
Shri R. C. Dave in his affidavit has deposed that these members of the Indian Administrative Service on the Board have the qualifications as laid down in Sub-sec. (4) (a) of Section 5 (4) of the Act. Shri R.C. Dave in his affidavit has referred to the names of Shri T.V. Ramanan. Shri B.L. Sharma and Shri N.S. Sushodia and deposed that the said persons are fully competent and qualified to be appointed as members on the Board within the meaning of Section 5 (4) (a) of the Act The State in its reply has also categorically stated that Shri T.V. Ramanan, Shri N.S. Sushodia and Shri B.L. Sharma belong to the category (a) of sub-section (4) of Section 5. Thus, there ample evidence to prove that there are appointees on the Board, who fulfil the qualification under Section 5 (4) (a) of the Act. Now, by virtue of Notification dated 11th December, 1987, there are three appointees by name to satisfy the requirement of Section 5 (4) (a) of the Act. 17. Under the third ground of attack, Shri C.K. Garg, learned counsel for the petitioners, has submitted that Section 9 of the Act has been violated since inter ilia, Shri R.C. Dave was the Director of M/s. Modern Insulator Ltd. In reply to the objection raised by Shri Garg, Dr. L.M. Singhvi, learned counsel for the Board has submitted that a bare reading of the provision of Section 9 would clearly demonstrate that the contentions of the petitioners based upon invalidity of an appointment flowing from Section 9 is untenable and unsupportable. He submits that the purpose of Section 9 is clearly intended to prohibit or regulate the conflict of any private and personal interest with the functions of the Government appointee in any firm or company. He has further submitted that the interest or benefit must be private and personal in nature. He submits that the word "interest" as used in Section 9 should be understood any interest which a member may have for his own benefit. Dr. Singhvi has placed reliance of (5) Public Prosecutor v. Khaitan, (1957) 27 Comp. Cases 77 , which is a Division Bench Judgment of the Madras high Court. In that case, it was held that what is hit by the section is, personal interest of the Director.
Dr. Singhvi has placed reliance of (5) Public Prosecutor v. Khaitan, (1957) 27 Comp. Cases 77 , which is a Division Bench Judgment of the Madras high Court. In that case, it was held that what is hit by the section is, personal interest of the Director. In that case, it was further held that the shares held by a Director on behalf of a Trustee would not constitute personal interest. He has also placed reliance on (6) Needle Industries v. N.I. Newey (India) Holding Ltd. (1981) 51 Comp. Cases 743 . In that case also, similar view was taken by the Supreme Court The proposition of law laid down in that case clearly mandates that the interest or concern cannot be merely sentimental or ideological or even one of close friendliness. In (7) Ramjilal Baisiwala v. Baiton Cables Ltd., (1964) 14, ILR (Raj) 135 , this Court his held that even a relation of a Director with the supplier under a contract with the company of which he is a Director, is not hit by Section 299 of the Companies Act. In the reply submitted by the Board, it has pleaded that Shri R. C. Dave does not own or control a single share of M/s. Modern Insulators and that he is only a nominated Director of the Company. It was also pointed out that on 18th April, 1985, the Secretary of RIICO wrote to the Vice Chairman of M/s. Modern Insulators stating that in exercise of the power vested under the Articles of Association, of RIICO, RIICO was desirous of appointing Shri R.C. Dave as a Member of the Board of M/s Modern Insulators. Thus, the appointment of Shri R.C. Dave was made as a member of M/s. Morden Insulators. It was an ex-officio appointment by virtue of the fact that Shri Dave was chairman of the Raj. State Electricity Board. The appointment was thus as a consequence and by virtue of the office which Shri Dave has held. Similar is the position with regard to the Directorships held by the Industries Secretary in M/s. Man Structurals Ltd. and M/s. Jaipur Udyog. From the various fact: and circumstances and proposition of law laid down, it is clear that these appointments have no relevancy or related to any personal gain or personal benefit.
Similar is the position with regard to the Directorships held by the Industries Secretary in M/s. Man Structurals Ltd. and M/s. Jaipur Udyog. From the various fact: and circumstances and proposition of law laid down, it is clear that these appointments have no relevancy or related to any personal gain or personal benefit. Shri H.C. Rastogi, learned counsel for the Board has informed us through the written submissions that Shri R.C. Dave, Chairman, RSEB, has already sent his resignation from the Directorship of M/s. Modern Insulator, in spite of the fact that the appointment was lawful and valid. In view of the fact that Shri R.C. Dave has tendered his resignation, we are of the opinion that there also remains no substance in the challenge made by the petitioners in this regard. 18. Regarding last point of attack which is with regard to allegations of corruption and favouritism etc. against Shri R. C. Dave, the main contention of Shri C.K. Garg is that on account of the fact that there were charges of corruption against Shri R.C. Dave and Shri Dave had shown favour to some of the Industrial House in the matter of granting concession in the tariff etc. and also because of the fact that the performance of the Board under the Chairmanship of Shri R.C. Dave remained highly poor and pathetic, the Board suffered huge losses inasmuch as that in the year 1986-87. The loss amounts to Rs. 6,354/- lacs. In the circumstances, Shri R. C. Dave incurred disqualification to be appointed as Chairman. Shri Garg submitted that it was not reasonable for the Government to have appointed Shri R.C. Dave as there was no compulsion for appointing him as Chairman.When doubts were raised about his integrity, his competency, then a chairman should have been appointed who should be a person who could give better results in the matter of financial and economic position of the Board. The petitioner Association had made complaints to the State Government and to the Central Government by addressing memoranda to the Chief Minister of the State and the Prime Minister of the country. These memoranda cover reasons by Shri R. C. Dave merited removal and why he should not be appointed or re-appointed.
The petitioner Association had made complaints to the State Government and to the Central Government by addressing memoranda to the Chief Minister of the State and the Prime Minister of the country. These memoranda cover reasons by Shri R. C. Dave merited removal and why he should not be appointed or re-appointed. Shri Garg has further submitted that when ever there is a public element involved in any activity of the Government, or the State functionary or the agency of the State; even in the matter of appointment, the Act should be done on the touch stone of reasonableness and public interest. Shri Garg has placed reliance on (8) Maneka Gandhi v. Union of India. AIR 1978 SC 597 , (9) M/s. Kasturi Lal v. State of J. & K, AIR 1980 SC 1972 and (10) Mohinder Singh Gill v. Chief Election Commissioner, AIR 1978, SC 851 . He has also referred to certain quotations form Wades hook on 'Administrative Law'. In short, his submission is that when discretionary power is conferred upon public; authorities, such discretionary powers are not absolute, but are subject to general legal limitations These limitations are that discretion must be exercised reasonably and in good faith and relevant consideration only must be taken into account. Shri Garg has pointed out that the report of Shri K.N. Gupta, Director, Anti corruption Department, Government of Rajasthan, Jaipur dated 27th February, 1984 is very clear. By this report, the Director has clearly found a prima facie case against Shri R.C. Dave and others tinder Prevention of Corruption Act. It related to the matter of purchase of transformers at a higher price from M/s. Rajasthan Power Equipment and Rajasthan Electrical Works. Shri Garg has also pointed out that there were acts of nepotism, favouritism in regard to concession given in the tariff to certain industries On the other hand. Dr. L.M. Singhvi, learned counsel Board submitted that the petitioners' allegation in the writ petition against Shri R.C. Dave in imputing his integrity are wholly of irresponsible nature apart from being false, frivolous and fictitious. He submitted that these allegations have been made by motivated persons wreaking vengeance since the office bearers of petitioner No. 1 Viz. the President and Secretary were charge-sheeted for serious misconducts during the tenure of Shri R. C. Dave and these charges were not withdrawn. Dr.
He submitted that these allegations have been made by motivated persons wreaking vengeance since the office bearers of petitioner No. 1 Viz. the President and Secretary were charge-sheeted for serious misconducts during the tenure of Shri R. C. Dave and these charges were not withdrawn. Dr. L.M. Singhvi has submitted that an appointment of an officer cannot be challenged in a writ petition under Article 226 of the Constitution on the ground which is essentially a matter of police investigation and enquiry under the provisions of the Criminal Procedure Code, as this Court cannot go into the accuracy, truthfulness or otherwise of the allegations. He has further submitted that this Court should not convert itself into a criminal Court of first instance or a fact finding commission of enquiry. The appointing authority has wide discretion to appoint members to Electricity Board and Chairman of the Board and the view of the appointing authority that a person has shown experience and capacity in commercial matters, and administration or that he is an Electrical Engineer having wide experience or that he has experience in accounting and financial matters will normally be conclusive. He has further submitted that while appointing Shri R.C. Dave as Chairman on 7th August, 1987. the Government appointed him after appropriate and over-all examination of the issue in the balancing and decision making matrix. On facts, he pointed out that on 27th February, 1984. Shri K.N. Gupta, the then Director, Anti-Corruption Department Government of Rajasthan wrote a letter to the Secretary to the Chief Minister enclosing therewith a brief not regarding purchase of transformers by the RSEB. The letter asked for the note to be brought to the attention of the Chief Minister and sought further guidance in the matter. On 12th August, 1985, Shri R. C Dave wrote to the Secretary to the Chief Minister stating that a press item had been brought to his notice published in daily Rastradoot dated 22nd July, 1985 to the effect that a communication was sent by the ACD regarding the alleged misconduct against him. In the letter, Sri Dave categorically stated that ACD had at no time whatsoever sought any explanation or clarification from him regarding the transaction involving purchase of transformers.
In the letter, Sri Dave categorically stated that ACD had at no time whatsoever sought any explanation or clarification from him regarding the transaction involving purchase of transformers. In the said letter, Shri Dave expressed his grievance that there had been complete non-observance of the basic norms and principles of natural justice and fair play, and that an opportunity must have been given to him to explain and clarify his position. Shri Dave also attached a detailed factual note with the said letter repudiating and placing in core, it perspective the allegations contained in the press news. The matter was thereafter referred by the Secretary to the Chief Minister to Dr. G.P. Pilania, the then Director, ACD. Dr. Pilania by his letter dated 20th March, 1986, stated inter alia that, "There is no definite proof of any mala fide against him (i.e. Shri Dave). It may also be pertinent to mention that as for as my information goes, Shri Dave is known for his transparent integrity." Shri Dutta. the then Director. ACD also confirmed that the preliminary enquiry was closed on 23rd August, 1986 by the ACD. We do not want to go into the details of allegations of charges levelled against Shri Dave. We are satisfied that the preliminary enquiry was closed by the State and the matter was got examined by the Government and the Government had with it the report of Dr. G.P. Pilania, Director ACD before re-appointment was made on 7th August, 1987. The sequence of events shows that much prior to 7th August, 1987, the issue regarding allegations of corruption against Shri R.C. Dave had already been closed. The writ petition was filed in July 1987 and re-appointment was made on 7th August, 1987 and the enquiry was closed on 23rd August, 1986. In the circumstances, we cannot convert this Court into a fact finding commission for adjudicating legality or correctness or veracity of the allegations. The original files were placed before us by the State. We have gone through them and we are satisfied that the enquiry was closed much prior to the filing of the writ petition. The appointing authority had full knowledge about the aforesaid happening. The appointing authority applied its mind and perhaps did not find any other equal or more suitable alternative to Shri R.C. Dave for re-appointment as Chairman.
We have gone through them and we are satisfied that the enquiry was closed much prior to the filing of the writ petition. The appointing authority had full knowledge about the aforesaid happening. The appointing authority applied its mind and perhaps did not find any other equal or more suitable alternative to Shri R.C. Dave for re-appointment as Chairman. A note was submitted to the Chief Minister by the Chief Secretary for re-appointment of Shri Dave. It was stated on 1st July, 1985. that Shri Dave has been discharging his duties very conscientiously and devotedly. It was on this that the Chief Minister noted, "Considering the experience and performance of Shri R.C. Dave, it would be appropriate to appoint him as Chairman of the Rajasthan State Electricity Board for a further period of two years". The re-appointment of Shri R.C. Dave in 1987 was recommended by the Emergy Minister and approved by the Chief Minister. We are not discussing the proposition of law canvassed by Shri C.K. Garg, learned counsel for the petitioners as we feel that there is no dispute about the same. We are satisfied that there is no material available on record to prove that in the re-appointment of Shri R.C. Dave, the Government acted either mala fidely or guided by any corrupt or collateral consideration. Thus, there is no merit in this contention also. 19. As regards various allegations of favouritism etc. as alleged by the petitioners in the memoranda, Annx. 3 to Annx. 5, we are of the opinion that this Court under Article 226 of the Constitution of India would not go into them as they involve determination of complicated questions of fact and further the decision in the matter of recovery of arrears or energy charges or purchase of transformer or revision of tariff are corporae decisions of the Board and not the individual decision of respondent No. 2. Such corporate decisions were taken by the Board in bona fide discharge of its functions, duties and obligations and we may say that the challenge to these decisions falls outside the ambit of Article 216 of the Constitution of India for determination of the questions regarding appointment or re-appointment of the members of the Board. Further the allegation that the Board was put to a loss has hardly any relevance for the determination of the questions raised in this writ petition.
Further the allegation that the Board was put to a loss has hardly any relevance for the determination of the questions raised in this writ petition. It is not disputed and cannot be disputed that the Board has to sell the power under State Policy to the agricultural consumers and other consumers at subsidised rates. Under the State Policy, the Board is under an obligation to supply electricity to agricultural sector even much less than the operational cost per unit. The State Government is fully competent to appoint/re-appoint a person as a member or Chairman of the Board, as the case may be, within the para-meteres of Section 5 of the Act read with Rule 4 of the Rules. 20. In the premises aforesaid, there is no merit in this writ petition and the same is dismissed with no order as to costs.Petition Dismissed. *******