TIRATH S. THAKUR, J. ( 1 ) THE challenge in this writ petition is directed against order dated 4th july, 1995 issued by the respondent-corporation whereby it has appointed respondent 3 as chief manager by promotion from the next lower post of deputy chief manager. The facts are few and may be stated first. ( 2 ) THE petitioner is working as deputy chief manager with the respondent-corporation. Promotions in different cadres of corporation are regulated by Karnataka state small industries development corporation (cadre and recruitment) rules. In terms of Rule 13, the managing director is empowered to make promotions on the basis of seniority-cum-merit provided that no employee notwithstanding his seniority is entitled to claim promotion as a matter of right. As per schedule a to the rules aforesaid, the post of chief manager (c and m) can be filled up by deputation or direct recruitment or even by promotion. For appointment by promotion, the schedule to the rules prescribes a minimum of 5 years service in the cadre of deputy chief manager (c and m) and specifically stipulates that selection shall be based on merit and not only by seniority. The schedule further prescribes that the managing director shall be the authority to decide and order promotions of all categories of employees, upto the grade of deputy chief manager. For promotion to the post of chief manager and above the promotions have to be decided by a committee consisting of the managing director and a director of the board. Accordingly, the board of directors in its 24th meeting constituted a selection committee comprising the managing director and Sri n. m. nabi, chairman of the company to consider the question of making promotion against the post of chief manager (c and m) from out of the eligible deputy chief manager (c and m) section. The committee so constituted appears to have met on 3rd of July 1995 and purports to have considered the cases of four deputy chief managers, including the petitioner herein. The committee eventually came to the conclusion that respondent 3 who was the senior most deputy chief manager was eligible for promotion. The recommendation culminated in the issue of the impugned order of promotion appointing the said respondent as chief manager (c and m ). Aggrieved, the petitioner has filed the present petition assailing the said order as already indicated earlier. The recommendation culminated in the issue of the impugned order of promotion appointing the said respondent as chief manager (c and m ). Aggrieved, the petitioner has filed the present petition assailing the said order as already indicated earlier. ( 3 ) APPEARING on behalf of the petitioner Mr. M. r. achar argued that the selection committee appointed by the board was bound to follow the procedure otherwise prescribed by Rule 6 of the rules aforesaid while making any selections for appointment against the post in question. He contended that even though the procedure prescribed by Rule 6 of the rules, primarily applied only to appointments by direct recruitment, yet in the absence of any other procedure prescribed by the rules for regulating appointments by promotion the selection committee had no choice but to follow the procedure prescribed for direct recruitments. This procedure according to the learned counsel ought to include a written or such other test as may have been considered appropriate besides an interview of the eligible candidates. I find no substance in this submission made by the learned counsel. The absence of a specific procedure for evaluation of the merit and suitability of the eligible candidates for purposes of promotions would not ipso facto make the procedure otherwise prescribed for making direct recruitments applicable to such promotions. A written test or interview is not an essential requirement for making a proper selection for purposes of appointment by promotion. Such appointments can be made even on the basis of a fair and objective assessment of the relevant service records of the eligible candidates. This is apparent even from Rule 13 of the rules which deals specifically with promotions and provides that promotions can be made on the basis of annual confidential reports and the financial and administrative performance of the candidates. There is therefore no substance in the submission made by Sri m. r. achar that any selection and consequent appointment by promotion even without subjecting the candidates to a written test, or interview is per se improper or illegal. So long as the candidates have been evaluated on the basis of their service record and so long as the said evaluation is fair and objective based on some intelligible non-discriminatory and rational norms and yardsticks, the mere absence of an interview or a written test, does not vitiate any such evaluation selection or appointment. So long as the candidates have been evaluated on the basis of their service record and so long as the said evaluation is fair and objective based on some intelligible non-discriminatory and rational norms and yardsticks, the mere absence of an interview or a written test, does not vitiate any such evaluation selection or appointment. I have therefore no hesitation in rejecting the first limb of the petitioner's case. ( 4 ) IT was next argued by Sri m. r. achar that sinc edepartmental enquiries were pending against the third respondents he could not have been selected or appointed pending his clearance in the said enquiries. Reliance was in this connection placed upon government circular dated 14th july, 1993 Annexure-F , to the petition according to which departmental promotion committee have been instructed to assess the merit and suitability of officers for promotion without taking into consideration the disciplinary and/or court proceedings pending against them. Any such assessment is directed to be kept in a sealed cover till the conclusion of the disciplinary/court proceedings to be opened only after the said proceedings are concluded and the official exonerated. It was submitted that the procedure prescribed by the circular aforesaid must be deemed to be applicable even to the officers of the respondent-corporation with the result that the consideration and evaluation of the third respondent's suitability for promotion ought to have been kept in a sealed cover till such time the two proceedings were concluded. Consequently his appointment by promotion pending departmental proceedings, was according to the learned counsel for the petitioner improper and impermissible. There is no merit even in this submission. It is not disputed that the official memorandum relied upon by the petitioner is applicable only to government servants and does not extend to the employees of the corporation. Any such circular would be applicable only in case the corporation specifically adopted the same or issued a circular on similar terms for its own employees. No such adoption or a fresh circular has been brought to my notice or even otherwise claimed. In the circumstances it is difficult to extend the procedure prescribed for government servants in its application to the employees of the corporation merely because the corporation is a wholly government owned organisation. The challenge to the selection proceedings on this ground also must therefore fail. In the circumstances it is difficult to extend the procedure prescribed for government servants in its application to the employees of the corporation merely because the corporation is a wholly government owned organisation. The challenge to the selection proceedings on this ground also must therefore fail. ( 5 ) THAT brings me to the third and the last limb of the submission made by Sri m. r. achar in support of the petition. The submission was three-fold. It was urged that the committee, which is said to have considered the case of the petitioner was not properly constituted, in that, instead of a director, the managing director had the chairman of the company sitting with him for purposes of evaluation of the merit and suitability of the candidates. This it was contended was against the letter and the spirit of rules thereby vitiating the process as also the end result of the selection. ( 6 ) SECONDLY, it was urged that even though the committeea foresaid purports to have considered the case of the petitioner for promotion, yet the consideration accorded was not proper, inasmuch as, the committee had ignored the relevant material which it was bound to take into consideration while making any such promotions. Reliance in this connection was placed upon Rule 13 of the rules in question, to show that financial and administrative performance was as important a material as the a. c. rs. Which ought to have been considered for a valid appointment by promotion. ( 7 ) THIRDLY, it was urged that the appointment of the third respondent based on the recommendation of the committee was contrary to clause 86 of the articles of association of the respondent-corporation, according to which any appointment against a post carrying a maximum pay scale of Rs. 4,550/- or more was compulsorily reserved for the approval of the government. No such approval according to the petitioner had been accorded by the government to the appointment of the third respondent. ( 8 ) ON behalf of the respondents, Sri u. l. narayana rao, senior Advocate and Sri p. r. ramesh, canvassed that the committee envisaged by the service rules was properly constituted in terms of the resolution passed by the board of directors in its 247th board meeting. ( 8 ) ON behalf of the respondents, Sri u. l. narayana rao, senior Advocate and Sri p. r. ramesh, canvassed that the committee envisaged by the service rules was properly constituted in terms of the resolution passed by the board of directors in its 247th board meeting. It was contended that since the chairman of the company, was also a director of the company, having been nominated as such by the government under notification dated 23rd of may, 1995, his inclusion in the committee as a director was neither objectionable nor otherwise impermissible. ( 9 ) AS regards non-consideration of relevant materials, it was urged that the committee had considered the annual confidential reports of all the eligible candidates including the petitioner, which was sufficient to justify the making of the selection. As to the violation of clause 86 (3) of the articles of association, it was urged that the said provision applied only to appointments by direct recruitment and not by way of promotion. Alternatively, it was urged that the violation of the articles of association did not give to the petitioner any cause of action nor could the same be made a basis for invalidation of the action taken by the corporation at the instance of a third party like the petitioner. ( 10 ) I have given my anxious consideration to the submission smade at the bar. ( 11 ) THE cadre and recruitment rules of the corporation envisage the appointment of a committee for purposes of making selections to the post of chief managers and above. The relevant portion of the schedule to the said rules provides thus: "appointing and promoting authority: (a) the managing director shall be the appointing authority in case of all categories of employees of the corporation; (b) the managing director shall be the authority to decide and order for promotion of all categories of employees and upto the grade of deputy chief manager and promotion to the cadre of chief managers and above shall be decided by a committee consisting of managing director and a director of the board shall issue the orders in this regard". (emphasis mine) ( 12 ) A plain reading of the above provision shows that consideration of cases and consequent selection of candidates for appointment by promotion to the cadre of chief managers has to be decided by a committee consisting of the managing director and a director of the board. In the instant case, however, instead of a director of the board comprising the selection committee with the managing director the board of directors had nominated the chairman of the company to function as the other director. The question therefore is as to whether the nomination of the chairman as a member of the committee was legally valid and in accordance with the rules aforesaid. A perusal of the minutes of the 247th board meeting shows that apart from other decisions taken in the said meeting, Sri ranganath kelvadi, who was appointed as managing director by the government was also appointed as chairman/member of the board sub-committees/selection committees in place of s. l. gangadharappa. The relevant portion of the resolution passed in this regard reads thus: "government of Karnataka by their notification No. Ci 36 ccl 95, dated 13-6-1995 have appointed Sri ranganath kelvadi as director and also as managing director of the company in place of Sri s. l. gangadharappa. The notification of appointment was noted. The other directors welcomed Sri ranganath kelvadi to the board and expressed confidence that under his leadership, the company will be able to keep up the tempo of progress as already set in. Sri ranganath kelvadi was also appointed chair nan/member of the board sub-committees/selection committees in place of Sri s. l. gangadharappa". ( 13 ) IT is therefore apparent that the selection committeeen visaged by the recruitment rules was to be chaired by the managing director of the corporation. If that be so, it is difficult to appreciate how in place of another director, the chairman of the company, who holds a position one step higher than the managing director could be nominated to serve in the capacity of a member of a committee, of which the chairman was one of his subordinates. A joint reading of the rules and the resolution quoted above, clearly shows that the scheme of the rules envisages the selection committee to be comprising of the managing director and a director only and not the managing director and the chairman of the company. A joint reading of the rules and the resolution quoted above, clearly shows that the scheme of the rules envisages the selection committee to be comprising of the managing director and a director only and not the managing director and the chairman of the company. This is so for more than one reasons. Firstly, because the language employed in the Rule is very clear, in that, it contemplates of only a director as a members of the committee and not the chairman of the corporation. Secondly, because, if the selection committee was chaired by the managing director a person holding a position higher than him could never be meant or reasonably expected to serve in a capacity subordinate to that he otherwise held, and thirdly because, if the intention of the rules was to make it possible for the chairman of the company also to be a member of the selection committee, there was no reason why the rules could not specifically say so. It follows that the Constitution of the selection committee was not proper and in accordance with the requirements of the rules. The argument that Sri n. m. nabi the chairman of the corporation was also a director of the board does not impress me. For an appointment as chairman of the corporation, it is necessary that the appointee is a member of the board of directors urged Sri p. r. ramesh but the two capacities according to him were distinct and could be retained simultaneously. In other words one could be the chairman and a director both and act alternatively in those capacities. The argument has an obvious fallacy in it. If being a director of the corporation is an essential condition as urged by Sri p. r. ramesh, for appointment as its chairman, then upon any such appointment, the person appointed would combine in himself the two capacities and on the principle of the lesser getting sunk or drowned in the bigger, his capacity as a director would sink in his capacity as a chairman, so long as he retains the later position. Any other interpretation would lead to anomalous results, for instance the chairman has a casting vote in terms of clause 77 of the articles of association; and if the interpretation placed by Sri p. r. ramesh was to be accepted it would mean that the chairman would have the right to cast his vote twice once as director of the corporation and again as its chairman. This was and could never be the true intention behind giving the chairman a casting vote. What follows is that once a director is appointed as a chairman, his capacity or position as director gets submerged in his higher position of chairman so that he cannot during the continuance of his chairmanship claim to be or otherwise function as a director. ( 14 ) I find considerable merit even in the second facet of Sri m. r. achar's argument. That the petitioner was eligible for promotion as per the rules is not disputed, nor can it be disputed that the selection committee purported to have considered his case alongwith those of three others including respondent 3 herein. The question however is whether the consideration accorded was fair and proper. As per Rule 13 of the rules suitability for promotion has to be decided upon a consideration of the annual confidential reports and the financial and administrative performance of the eligible candidates. Rule 13 may at this stage be extracted. "the managing director is empowered to make promotions on the basis of seniority-cum-merit (i. e. , annual confidential reports and also the financial and administrative performance) and no employee, notwithstanding his seniority, can claim promotion to any post as a matter of right". ( 15 ) A plain reading of the Rule shows that the consideration of the cases of the candidates has to be on the basis of not only the a. c. rs. But also upon their financial and administrative performance. The Rule clearly makes a distinction between the reports earned by the officers and their financial and administrative performance; making it unnecessary for me to go into the question whether the confidential reports of the officers did or did not in a smaller or greater measure reflect their financial and administrative performance as well. The Rule clearly makes a distinction between the reports earned by the officers and their financial and administrative performance; making it unnecessary for me to go into the question whether the confidential reports of the officers did or did not in a smaller or greater measure reflect their financial and administrative performance as well. I will remain content with the observations that if the Rule itself makes a distinction between the two it must follow without anything, further that there is a qualitative difference in the two insofar as their relevance as material constituting the basis of consideration is concerned. What follows is that it is not open to the respondents to argue that consideration based on only one of the two could not also suffice; either because one reflected the other or that the consideration of one made the consideration of the other unnecessary. ( 16 ) LET us then see whether the committee considered the cases of the candidates by reference to and on the basis of both the types of material made relevant by Rule 13 supra. The answer is provided by the proceedings of the selection committee dated 3-7-1995 held in the chamber of the chairman of the corporation. The proceedings record that the a. c. rs. Of the candidates were reviewed and their qualifications and places of postings noticed. The committee then records its conclusion in the following three paragraphs of the proceedings a copy where of was produced by Sri p. r. ramesh. "as regards the confidential reports, it is seen that the confidential report of all the officers for the year 1994-95 which are available has no adverse remarks entered therein. But as regards previous years confidential reports, though they are available, they are not for a continuous period ending with 1994-95. The available c. rs. In respect of the candidates were perused by the committee. The committee noted that wherever the c. rs. Are not available for the reasons that they are not written, it should be presumed that they are not adverse. As regards the seniority position, the committee perused the seniority list drawn up by the corporation and it indicates that Sri kb. Nagendra, is the senior most and thereafter Sri s. g. kembhavi, Sri n. c. chikkanna gouder and Sri s. p. raghunath figure in the list. As regards the seniority position, the committee perused the seniority list drawn up by the corporation and it indicates that Sri kb. Nagendra, is the senior most and thereafter Sri s. g. kembhavi, Sri n. c. chikkanna gouder and Sri s. p. raghunath figure in the list. Having considered all the aspects of the matter, the committee has come to the conclusion that Sri kb. Nagendra, the senior most deputy chief manager (c and m) is eligible for promotion". ( 17 ) ). Two significant features can be noted from the above. First and the foremost being the total non-consideration of the "financial and administrative performance" of the candidates. The report of the committee does not even refer to any such performance let alone demonstrate a fair and proper consideration of the same. To that extent therefore the committee ignored from its consideration material that was admissible not only by reason of its general relevance to the question being considered but even because of the sanction given to the same by Rule 13. A consideration based on such a truncated material would not satisfy the requirements of Rule 13 of the rules or those of articles 14 and 16 of the constitution, for it is well-settled that consideration of irrelevant material or non-consideration of what is relevant would both vitiate the end result. ( 18 ) THE other and equally important feature is the angle from which the committee considered the whole issue. What is significant to note is that the committee has, based on its examination of the a. c. rs. Come to the conclusion that respondent 3 was "eligible for promotion". Now it is nobody's case that there was any dispute or doubt about the eligibility of respondent 3 for promotion. What was required to be examined and recorded by the committee was as to who out of the eligible candidates was in the light of the relevant service record, the best suited person for promotion, keeping in view the fact that seniority alone was not enough. The crucial question in any such consideration was the merit of the candidates seniority playing a decisive role only when the merit of all the eligible candidates was equal. There is however nothing in the proceedings of the committee to show that the committee appreciated this angle or attempted an answer by reference to the same. The crucial question in any such consideration was the merit of the candidates seniority playing a decisive role only when the merit of all the eligible candidates was equal. There is however nothing in the proceedings of the committee to show that the committee appreciated this angle or attempted an answer by reference to the same. If the committee's report is an indication of the working of its mind, it can be easily said that seniority and seniority alone constituted the basis of its recommendation for promotion; merit of the candidates taking a back seat or going out of the screen totally. ( 19 ) SRI u. l. narayana rao however argued on the authority of the decision of the Supreme Court in National Institute of Mental Health and Neuro Sciences v Dr. K. Kalyana Raman and others, that the job of a selection committee is only administrative and that it is under no obligation to record reasons for its decision unless specifically required by any provision law or the rules. There is and can be no dispute about this proposition of law. But then the question is not of recording reasons for a conclusion, arrived at by the committee, the question is whether or not while arriving at any such conclusion, the committee considered the material that was relevant and whether it did so by approaching the matter from the correct angle. A failure on either one of the two counts would have the effect of vitiating the result, as it would do in the present case. ( 20 ) IN the light of the view I have taken on the first two aspects of the petitioner's case. I consider it unnecessary to examine in detail the third aspect argued by Sri m. r. achar on the basis of clause 86 (2) of the articles of association of the respondent-corporation. I would therefore leave the same open. ( 21 ) IN the result, this petition succeeds and is here by allowed. The impugned order of promotion of the third respondent as chief manager is hereby quashed reserving liberty for the corporation to make a fresh order in accordance with law and keeping in view the observations made herein above. The parties are however left to bear their own costs. --- *** --- .