A. P. SOMASHEKAR v. KARNATAKA STATE WAREHOUSING CORPORATION
1996-07-12
A.J.SADASHIVA
body1996
DigiLaw.ai
A. J. SADASHIVA, J. ( 1 ) THOUGH this petition is listed for preliminary hearing, the same is taken up for final disposal, on issuing rule, with the consent of the learned Counsel appearing on both the sides, since the question in controversy relates only in respect of the jurisdiction or lack of jurisdiction, of the second respondent to pass an order of suspension against Class II employee of the corporation. ( 2 ) THE petitioner is a Class II officer working in the first respondent-Corporation as a Warehouse Manager-Grade II. By the order dated 1-6-1996, the second respondent kept him under suspension in contemplation of an enquiry in respect of certain acts of misconduct alleged to have been committed by him. The petitioner has filed this petition for quashing the said order on the ground that, the second respondent lacks jurisdiction to make an order of suspension against Class II officer in view of regulation 20 of the Karnataka State Warehousing Corporation (Staff) Regulations, 1959 (hereinafter called the 'regulations' ). ( 3 ) SRI N. B. Bhat, the learned Counsel appearing for the respondents has contended that, in view of sub-section (3) of section 20 of the Warehousing Corporations Act, 1962 (for short 'the Act'), the Board of Directors of the first respondent-Corporation have delegated the power to place any officer under suspension excepting Commercial Manager pending detailed enquiry, to the Managing Director by Board resolution No. 4/bd Mtg. dated November 19, 1983; in view of such delegation of powers by the Board of Directors, Regulation 20 of the regulations becomes irrelevant; where there are more than one source of power, it is open to the authority to choose either of the two and, the Managing Director in exercise of his delegated powers by virtue of the resolution dated November 19, 1983, has passed the order impugned in this petition, and therefore it is valid and enforceable. Per contra, Sri K. R. Bhavani Shankar, the learned Counsel for the petitioner has contended that, the regulations have been made under the rule making powers, with the prior approval of the Government; when such regulations are in force, they cannot be rendered ineffective by a mere resolution of the Board; the resolution, in view of the regulations, has no relevance.
( 4 ) IN view of the aforesaid rival contentions, the only question that arise for my consideration in this petition is, whether the impugned order of the Managing Director made in exercise of his delegated power under sub-section (3) of Section 20 of the Act, is valid and enforceable, in spite of being violative of Regulation 20 of the regulations. ( 5 ) IT is admitted that the regulations are made -by the Corporation in exercise of power under Section 54 of the agricultural Produce (Development and Warehousing) corporations Act, 1956 (hereinafter called 'the 1956 Act'), and they continue to be in operation, by virtue of Section 43 (2) (d) of the Act. Regulation 20 of the regulations, reads as follows:"20. An employee may be placed under suspension, pending an inquiry against him for breach of discipline or where a case against him, in respect of any criminal offence, is under investigation or trial. The power to place an employee of Class III under suspension she i be exercised by the Managing Director and by the Executive Committee in respect of employees in Class I or II". Section 54 of the 1956 Act reads as follows:"54. (1) A Warehousing Corporation may, with the previous sanction of the appropriate Government by notification in the Official Gazette, make regulations not inconsistent with this Act and the rules made thereunder to provide for all matters for which provision is necessary or expedient for the purposes of giving effect to the provisions of this act. (2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for, (a) the conditions of service, of and the remuneration payable to, the officers and other employees of a Ware- housing Corporation; (b) the manner in which and the conditions subject to which, shares of the Central Warehousing Corporation may be transferred; (c) the manner in which meetings of a Warehousing corporation and the Executive Committee thereof shall be convened, the fees for attending such meet- ings, the procedure to be followed thereat; (d) the duties and conduct of officers and employees of a Warehousing Corporation; (e) the duties which may be entrusted or delegated to the Managing Director of a Warehousing Corporation; (f) generally, the efficient conduct of the affairs of a warehousing Corporation.
(3) The appropriate Government may, by notification in the official Gazette, rescind any regulation which it has sanctioned and thereupon the regulation shall cease to have effect". ( 6 ) SUB-SECTION (3) of Section 20 of the Act deals with powers and duties of the Managing Director and it reads as follows:"20 (3 ). The Managing Director shall, (a) exercise such powers and perform such duties as the board of Directors or the State Warehousing Corporation may entrust or delegate to him; and (b) receive such salary and allowances as the State Warehousing corporation may, in consultation with the Central warehousing Corporation, and with the previous approval of the State Government fix". Section 42 of the Act deals with the power of the Warehousing corporation to make regulations. It reads as follows:"42. (1) A Warehousing Corporation may, with the previous sanction of the appropriate Government, by notification in the Official Gazette, make regulations not inconsistent with this Act and rules made thereunder to provide for all matters for which provision is necessary or expedient for the purposes of giving effect to the provisions of this Act. (2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for, (a) the conditions of service of, and the remuneration payable to, the officers and other employees of a Warehousing Corporation; (b) the manner in which, and the conditions subject to which, shares of the Central warehousing Corporation may be transferred; (c) the manner in which meetings of a Warehousing corporation and the Executive committee thereof shall be convened, the fees for attending such meetings and the procedure to be followed thereat; (d) the duties and conduct of officers and employees of a Warehousing Corporation; (e) the powers and duties which may be entrusted or delegated to the Managing Director of a Warehousing Corporation; (f) generally, the efficient conduct of the affairs of a Warehousing Corporation. (3) The appropriate Government may, by notification in the Official Gazette, rescind any regulation which it has sanctioned and thereupon the regulation shall cease to have effect". ( 7 ) IN view of the aforesaid provisions, it is contended by Sri N. B. Bhat, the learned Counsel appearing for the respondents that, there are two sources of power to make an order of suspension against an employee and it is open to the authority to invoke either of the two sources.
( 7 ) IN view of the aforesaid provisions, it is contended by Sri N. B. Bhat, the learned Counsel appearing for the respondents that, there are two sources of power to make an order of suspension against an employee and it is open to the authority to invoke either of the two sources. It is his further contention that where the Managing Director exercises his power under sub-section (3) of Section 20 of the Act, it is not open to the petitioner to contend that the power of suspension ought to have been exercised only in accordance with the regulation and not otherwise. Sri N. B. Bhat, the learned Counsel for the respondents, further contended that if, the contention of the petitioner that, the power to pass an order of suspension shall be made only in accordance with the regulations, is accepted, sub-section (3) of Section 20 of the Act, would be rendered otiose; and, unless the said provision is declared invalid, it cannot be rendered ineffective just because of the existence of another similar provision. ( 8 ) SRI K. R. Bhavani Shankar, the learned Counsel appearing for the petitioner has contended that the Act provides for making regulations with the prior approval of the Government for the purposes of giving effect to the provisions of the Act, under Section 42 of the Act and, it also empowers the warehousing Corporation to make regulations in respect of certain special purposes such as the conditions of services of and the remuneration payable to, the officers and other employees of the Warehousing Corporation; the duties and conduct of officers and employees of the Warehousing Corporation and; the powers and duties which may be entrusted or delegated to the Managing director of the Warehousing Corporation, etc. It is his further contention that where the Warehousing Corporation has made the regulation with the prior approval of the State Government conferring power of suspension on different authorities in respect of different class of employees; the Board of Directors has no power to nullify such regulation, by a mere resolution, without the approval of the Government. ( 9 ) AT this juncture, I think it is material to note sub-section (3) of Section 30 of the 1956 Act which deals with the power and duties of the Managing Director, as entrusted or delegated and, it reads as follows:"30 (3 ).
( 9 ) AT this juncture, I think it is material to note sub-section (3) of Section 30 of the 1956 Act which deals with the power and duties of the Managing Director, as entrusted or delegated and, it reads as follows:"30 (3 ). The Managing Director shall, (a) be a whole-time officer of the State Warehousing Corporation; (b) perform such duties as the State Warehousing Corporation may, by regulations made under this Act, entrust or delegate to him; and (c) receive such salary and allowances as the State warehousing Corporation may, in consultation with the Central Warehousing Corporation, and with the previous approval of the State Government fix". ( 10 ) FROM the provisions of the Act, it is clear that sub-section (3) of Section 20 of the Act states that, the Managing Director shall exercise powers and perform duties as the Board of directors or the State Warehousing Corporation may entrust or delegate to him. Section 42 of the Act empowers the warehousing Corporation to make regulation for the purpose of giving effect to the provisions of the Act generally and particularly with reference to the service conditions of the employees and the powers and duties that may be delegated to the Managing Director. The 1956 Act specifically prescribes that the Managing Director shall "perform such duties as the State warehousing Corporation may, by regulations made under this act, entrust or delegate to him". The said process of delegation or entrustment is absent in the Act. But, while considering the regulation made with the prior approval of the Government in respect of the service conditions of the employees as well as the powers and duties of the Managing Director that may be entrusted or delegated, the question that arises for consideration is whether the entrustment or delegation made by a mere resolution of the Board of Directors is a sufficient compliance of entrustment or delegation, in view of regulation to be made with the prior approval of the Government and particularly in view of such regulation being in force. It is also material to note that, regulation 20 of the regulations are made under Section 54 of the 1956 Act, which also empower the Corporation to frame the regulations regarding the powers and duties which may be entrusted or delegated to the Managing Director of a warehousing Corporation.
It is also material to note that, regulation 20 of the regulations are made under Section 54 of the 1956 Act, which also empower the Corporation to frame the regulations regarding the powers and duties which may be entrusted or delegated to the Managing Director of a warehousing Corporation. Regulation 20 specifically distributes the power to place any officer under suspension both upon the managing Director and the Executive Committee. Section 42 of the Act also contains a similar clause. The regulations are continued to be in operation by virtue of Section 43 (2) (d) of the act. In those circumstances, it cannot be said that, the Board can nullify the regulation made by the Warehousing Corporation with the prior approval of the Government, by a mere resolution without the prior approval of the Government. Sub-section (3) of section 20 of the Act, may empower the Board to delegate its power by a mere resolution if no regulations are in operation. ( 11 ) THE Supreme Court in The Life Insurance Corporation of India v D. J. Bahadur and Others, considering the scope and ambit of Section 11 (2) of the Life Insurance Corporation Act, 1956 has held as follows:"it is true that the words "employees or any class of them" in the second limb are not prefaced by the qualifying word "transferred" or "such". But that was hardly necessary when regard is had to the mosaic of sections in which the provision is located. Admittedly, the first limb of sub-section (2) relates to transferred employees only, and it must be held that so does the second limb. Both provisions are intended to constitute a composite process for rationalising the scales of remuneration and other terms and conditions of service of transferred employees with a view not only to effecting a standardisation between the transferred employees but also to revising their scales of remuneration, and terms and conditions of service to a pattern which will enable the newly established Corporation to become a viable and commercially successful enterprise".
The Supreme Court in Shri Balaganesan Metals v M. N. Shanmugham Chetty and Others, while interpreting the definition of "building" as stated in the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, has stated as follows: "it is a well-settled rule of interpretation of statutes that the provisions of an Act should be interpreted in such a manner as not to render any of its provisions otiose unless there are compelling reasons for the Court to resort to that extreme contingency". ( 12 ) IN the facts and circumstances of this case, if it is held that the order of suspension should have been in accordance with the provisions of the regulations, as the Board has no power to nullify the regulations by delegating certain powers by means of a resolution, I do not think that it would render sub-section (3) of Section 20 of the Act otiose. Such interpretation would clarify or explain as to the mode of entrustment or delegation in view of section 42 of the Act. In view of the regulations being made under Section 54 of the 1956 Act, the said regulations in my considered view could not be nullified by a mere resolution of the board. Where there are two provisions, one providing for the mode of entrustment or delegation and the other providing for mere entrustment and delegation, both must be read together and must be given a harmonious construction, i. e. , by adopting the one, the other should not be rendered otiose. ( 13 ) IN this view of the matter, I am of the considered view that the delegation or entrustment shall be in accordance with section 42 of the Act and not by a mere resolution, if the corporation had already framed regulation touching the very subject, and, as the power of suspending Class II officers is delegated to the Managing Director by a resolution, the impugned order is unsustainable in law. In the result this petition is allowed. Rule made absolute. The impugned order dated 1/3-6-1996 produced at Annexure-A is hereby quashed. However, it is open to the respondents to take action against the petitioner in such other manner as allowed in law. In the circumstances of the case, there is no order as to costs. --- *** --- .