Judgment M. Y. Eqbal, J. 1. This appeal under clause 10 of the Letter Patent Appeal of the Patna High Court Rules is directed against the judgment and order dated 10-1-1997 passed by a learned Single judge of this Court in C. W. J. C. No.1455/96 (R ). By the impugned judgment the learned Single Judge after quashing the order passed in departmental proceeding remitted back the matter to the disciplinary authority for proceeding afresh from the stage after serving a copy of the enquiry report to the petitioner. 2. The brief facts of the case are as follow: -The appellant-petitioner was an employee in the Hindusthan Steel Limited which subsequently merged with the Steel authority of India Limited. The respondent no.1, namely Metallurgical Engineering consultants (India) Limited (here in after referred to as MECON)was established and created under the Indian Companies act, 1956, being a subsidiary of Steel authority of India Limited by the Government of India. According to the petitioner appellant, when the unit of Hindusthan steel Limited was merged with the mecon, the petitioner-appellant was offered appointment under respondent No.1 the appellants case is that on 6-6-73 a decision was taken by the competent authority to frame a condition afresh for appointment of employees of Hindusthan steel Limited in new organization, namely mecon, and thereafter an appointment letter was issued to the appellant by the respondent No.1 appointing him under certain terms and conditions. The appellants case was that even after the appointment of the appellant the condition of service provided under the service rules of Hindusthan Steel Limited was made applicable in the case of the appellant. The appellant is said to have accepted the letter of appointment and joined MECON. The petitioner-appellant was promoted from E-4 grade to E-5 grade by respondent No.5 on 2-8-91 with the approval of the Chairman-cum-Manag-mg director of MECON who is the appointing and disciplinary authority of E-5 grade. The appellants further case was that the organizational structure of respondent no 1 MECON was published by the competent authority whereby the appellant was under the direct control and supervision of Director (Technology) since he was working in Iron Making. According to the appellant, he has nothing to do with the Director (Projects) who was neither the appellants immediate controlling authority nor he has to do anything with the iron making Work. According to the appellant, he has nothing to do with the Director (Projects) who was neither the appellants immediate controlling authority nor he has to do anything with the iron making Work. In the year 1995, a departmental proceeding was initiated against the appellant and the appellant was put under suspension. Charges were framed by respondent No.3, Director (Projects), and in response thereto, the appellant filed explanation and further filed a petition before the Director (Projects)demanding various documents for the purpose of giving effective reply. In his reply, the appellant disputed and challenged the authority of the Director (Projects) to issue chargesheet and to initiate departmental proceeding. However, one Mr. S. Chitaranjan, was appointed as an Enquiring Officer before whom the appellant appeared and protested for initiation of departmental proceeding and framing of charges by the Director (Projects ). The appellants case was that after conclusion of the departmental proceeding , no enquiry report was given to the petitioner-appellant and on 11-10-95 with the approval of the Director (Projects)the appellant was reverted to the next lower post i. e. E-5 grade to E4 grade. The petitioner-appellant then moved in departmental appeal which was also rejected. The appellant then challenged the aforesaid orders by filing C. W. J. C. No.1455/96 (R) which was disposed of by the learned Single Judge in terms of the impugned Judgment and order. 3. The learned Single Judge came to a finding that the copy of the enquiry report was not served to the appellant depriving him from making out his defence and thereby serious prejudice was caused to the appellant. On the question of jurisdiction and authority of the Director (Projects), the learned single Judge held that the Directors have been delegated power of disciplinary authority in respect of employees upto E-5 grade and therefore he was the competent authority for all purposes and accordingly, according to the learned Single Judge, the respondent no.3, the Director (Projects) was the competent authority to impose penalty. 4. Being aggrieved by the second part of the impugned judgment and the order of the learned Single Judge, the appellant has come before this Court in Letters Patent Appeal. Mr. Inderjit gupta, the petitioner-appellant, who appeared in person, challenged the impugned order and judgment as being illegal and contrary to the facts and evidence on record. 4. Being aggrieved by the second part of the impugned judgment and the order of the learned Single Judge, the appellant has come before this Court in Letters Patent Appeal. Mr. Inderjit gupta, the petitioner-appellant, who appeared in person, challenged the impugned order and judgment as being illegal and contrary to the facts and evidence on record. The appellant firstly submitted that he was promoted to E-5 grade with the approval of the Chainnan-cum-Managing director who is the competent authority and also the disciplinary authority. It is further submitted that the appellant is under direct control of Director (Technology) and he has nothing to do with the Director (Projects ). According to the appellant, under Discipline and Appeal Rules of the respondent, the Chairman is the competent authority. It is further submitted that the appointing authority cannot delegate its power to the subordinate authority in the matter of diciplinary proceeding. Even Article of association of respondent No.1, mecon, does not empower the Board of Directors of the Company to delegate such power. It is further submitted that in no case disciplinary authority will be lower than the appointing authority. The main thrust of submission of the appellant is that the mecon Service Rules applies to all the employees whether permanent or temporary who are in the whole time employment of MECON unless otherwise provided by the terms of any contract of employment. Since in the appointment letter of the appellant it was clearly stated that he shall be governed by the Discipline and Appeal rules of Hindusthan Steel Limited and not MECON, it is the Chairman only who is the appointing and disciplinary authority and not the Director. The appellant also disputed the contention of the respondent that the power of the diciplinary authority was delegated in the Boards meeting dated 10th October, 1985, and it was never communicated to all the authorities concerned. 5. On the other hand Mr. Ram balak Mahato, learned Counsel appearing for the respondents, firstly submitted that the respondent No.1 mecon was incorporated and registered as Company in the year 1973 as a subsidiary company of the Steel authority of India Limited (SAIL ). This new company MECON took over the business and other activities of part of the business and activities of Central engineering and Design Bureau of hindusthan Steel Limited. This new company MECON took over the business and other activities of part of the business and activities of Central engineering and Design Bureau of hindusthan Steel Limited. Thereafter a general letter dated 6th June, 1973 (Annexure-1)was issued giving offer to all the employees of Central Engineering and Design Bureau unit of Hindusthan steel Limited to join in the new company. The learned Counsel then submitted that the appellant accepted the said offer and an appointment letter was issued by MECON subject to the terms and conditions as may be amended from time to time by respondent No.1, mecon. The learned Counsel further drawn our attention to the Act namely the Public Sector Iron and Steel Com-panies (Restructuring) and Miscellaneous provision Act, 1978, and submitted that the erstwhile company namely the hindusthan Steel Limited stood disolved and thereafter the service rules and service conditions of MECON became applicable to all its employees. Mr. Mahato coming to the facts of the case, submitted that when the chargesheet was issued on 15th June, 1995 (Annexure-6) by the Director (Projects) as disciplinary authority asking the appellant to submit explanation, the appellant did not raise any objection with regard to the authority of the Director, rather the appellant addressed the director as disciplinary authority and request was made for supply of certain documents. However, for the first time, the appellant raised the objection in reply to his chargesheets about the authority of the Director. In reply, respondent No.1, MECON, categorically informed the appellant about the resolution taken by the Board of directors delegating power of ds (1997) 2 blj iciplinary authority to the Directors. Referring to the various documents, particularly, Annexure-- G and H, the learned Counsel submitted that by the resolution the Directors have been delegated with the power of disciplinary authority and therefore it was submitted that the learned Single Judge was right in holding that by virtue of delegation of power the Director is the competent authority to hold the disciplinary proceeding. 6. Before appreciating the rival contention of the parties, it would be useful to look into the brief history of the constitution of MECON and the relevant Act and the Rules in this regard. From the Memorandum of Association and Article of Association of the respondent No.1, it appears that the respondent No.1, Metallurgical and engineering Consultant (India)Limited, was incorporated as company under the Indian Companies Act, 1956 . From the Memorandum of Association and Article of Association of the respondent No.1, it appears that the respondent No.1, Metallurgical and engineering Consultant (India)Limited, was incorporated as company under the Indian Companies Act, 1956 . The company was established with the object inter alia, to acquire and take over the business activities carried on by the Central Engineering Design Bureau, the technological and consultancy unit of Hindusthan Steel Limited, together with all its efforts, liabilities, obligations and current contracts and other activities. The Memorandum of Association, inter alia, provides that the business of the company shall be managed by the Board of Directors. It further provides that the President means the President of India who shall from time to time determine the number of Directors of the company and the president shall appoint Chairman-cum-Managing Director, the Chairman of the Board of Directors and the members of the Board of Directors. The memorandum of Association further provides the power of the Directors, besides the power conferred by the Act. The power of the Directors includes the power to delegate and subdelegate to other authorities. From the perusal of the Establishment Manual of the respondent No.1 containing the service rule, it appears that it is made applicable to its all employees, whether permanent or temporary, who are in the whole time employment of the said company. Under the said rule, it appears that for the purpose of imposing major and minor penalties in respect of employees in the grade of Rs.7500-9900 has been vested with and delegated to the Director of the company. One more aspect is worth to be looked into i. e. the Act namely Public Sector Iron and Steel companies (Restructuring) and Miscellaneous provision Act, 1978. This Act was enacted by the Parliament for the purpose of restructuring of the Iron and Steel companies in the public sector so as to secure better management and greater efficiency in their working and for matters connected therewith or incidental thereto. Sec.4 of the said Act provides that on. the appointed day the companies specified in the first schedule shall stand dissolved and subject to provision of Sec.6 and 7, all the un-dertakings of such companies shall stand transferred to and vest in the integral company. From the schedule of the Act, it appears that erstwhile hindusthan Steel Limited in which the petitioner-appellant was employed also stood dissolved. the appointed day the companies specified in the first schedule shall stand dissolved and subject to provision of Sec.6 and 7, all the un-dertakings of such companies shall stand transferred to and vest in the integral company. From the schedule of the Act, it appears that erstwhile hindusthan Steel Limited in which the petitioner-appellant was employed also stood dissolved. However, Sec.15 of the said Act is worth to be noticed which reads as under:- Provisions relating to officers and employees transferred. . . . . . (sic ).- "15. (1)Every officer or other employee holding office immediately before the appointed day in the transferred unit shall, as from the appointed day, continue to be an officer or other employee of the corresponding unit of the transferred company by the same tenure and upon the same terms and conditions of service and with the same rights and privileges as to retirement benefits as would have been admissible to him if the transferred unit in which he was holding office had not been transferred and shall continue to do so unless and until such tenure and terms and conditions are duly altered by the transferee company. (2) Notwithstanding anything contained in sub-section (1) rules relating to the conditions of service and Standing orders applicable to the officers or other employees referred to in sub-section (1), as immediately before the appointed day, shall continue to apply unless and until they are duly altered by the transferee company or other authority, as the case may be". From bare reading of the aforesaid provision, it is manifest that all officers and employees holding office in the said transferred company before the appointed day shall continue to be the officer and employee of the said company on the same terms and conditions of service admissible to them if the transferee unit in which they were holding office had not been transferred unless and until such service conditions are duly altered by the transferee company. 7 In the light of the facts and the laws discussed hereinabove, the only questions arise for determination are -firstly whether the power of disciplinary authority has been delegated to the directors of the company and secondly whether on the date of initiation of departmental proceeding against the petitioner-appellant, the Director was the disciplinary authority. 8. 7 In the light of the facts and the laws discussed hereinabove, the only questions arise for determination are -firstly whether the power of disciplinary authority has been delegated to the directors of the company and secondly whether on the date of initiation of departmental proceeding against the petitioner-appellant, the Director was the disciplinary authority. 8. There is no dispute that the appellant was working in the post of E-5 grade at the time when the departmental proceeding was initiated against him. As noticed above, in the year 1973 the appointment letter was issued to the appellant by MECON appointing him as Design Engineer. Clause 4, 9 and 10 of the appointment letter dated 11th june, 1973, reads as under:- Clause 4:-"you shall be subject to the service rules and regulations including the conduct rules as well as the administrative orders as in force in Hindusthan Steel limited on the date of issue of this offer of appointment or as may be amended by the company from time to time. " clause 9:- "all other terms and conditions of your service including probation, if any, shall be the same as stipulated in the letter of appointment issued by Hindusthan Steel Limited. " clause 10:- "in case of any dispute of interpretation of any terms and conditions of this offer of appointment or the rules governing your service or otherwise, howsoever, reason, the decision of the company thereto shall be final and binding. " as noticed above the erstwhile employer of the company namely hindusthan Steel Limited stood dissolved in 1978 by virtue of the aforesaid Act, 1978, and the service conditions of respondent No.1 MECON was made applicable. Besides, it appears that at the initial stage when the chargesheet was issued by the Director as disciplinary authority calling explanation from the appellant, no objection was raised by him with regard to the authority of the Director to act as disciplinary authority. However, at a subsequent stage when the authority of the Director was questioned, the appellant-petitioner was duly informed about the resolution taken by the Board of Directors delegating power of disciplinary authority to the Directors of the company. In support thereof, the respondent produced documents which have been considered by the learned Single judge. However, at a subsequent stage when the authority of the Director was questioned, the appellant-petitioner was duly informed about the resolution taken by the Board of Directors delegating power of disciplinary authority to the Directors of the company. In support thereof, the respondent produced documents which have been considered by the learned Single judge. 9 From perusal of Annexure-G to the counter-affidavit, it is evident that in its meeting held on 11-2-86, the board of Directors, by resolution, approved the schedule delegating the power to the Directors for taking disciplinary action under the Discipline and appeal Rules of the company. Annexure-3 to the schedule very clearly provides that the Directors have been delegated full powers of disciplinary authority in respect of all employees in the grade of Rs.2250-3250. In the said schedule it further clearly provided that the grade indicated therein are as on 1-8-1982 and would include the corresponding grade, if and when revised. Admittedly in the year 1982, the pay-scale of grade E-5 in the company was rs.2250-3250 which is evident from annexure-18 to the memo of appeal annexed by the appellant. 10. From the facts stated hereinbefore, i am of the opinion that the learned Single Judge has correctly held that the respondent No.3, the Director, was the competent authority to initiate departmental proceeding and impose penalty. From perusal of the office order dated 7th, February, 1986, it further appears that in the matter of appointment and disciplinary action full powers have been delegated to the directors in respect of employees in the grade of Rs.2250-3250 and also in respect of the employees in the grade of rs.2550-3250. 11. Having regard to the facts and circumstances of the case and discussion made above, I do not find any illegality or infirmity in the judgment of the learned Single Judge whereby it held that the Director is competent to take disciplinary action and impose major penalty against the appellant. I do not, therefore, find any merit in this appeal which is accordingly dismissed. No order as to costs. Appeal Dismissed.