B. M. LAL, J. This is a reference made by Honble Chief Justice under Chapter VIII, Rule 3 of the Rules of the Court in view of the difference of opinion on the reasonings and conclusions in the Division Bench comprising Honble Mr. Justice P. Basu and Honble Mr. Justice M. C. Agarwal in the aforesaid writ peti tion. 2. The short facts leading to this refer ence are as under: (a) In pursuance of a Public Notice dated 16-1-1995 issued under Chapter VI of U. P. Minor Minerals (Concession) Rules, 1963, petitioner Ram Bishwash and others including respondent No. 3 applied for grant of mining permits in respect of sand/morum. They offered their bids The bid of respondent No. 3 was found highest as such it was accepted and a mining permit was granted to him. It is this grant of permit in the name of respondent No. 3 that has been challenged by means of this petition on the ground that the respondent No. 3 being an employee of U. P. State Mineral Development Corporation (for short the corporation) was legally incapable of entering into any business contract during the*course of his employment. (b) The writ petition was listed before the aforesaid Division Bench of this Court. Having heard learned Counsel for the parties and having given thoughtful considerations to the facts and circumstances of the case one Honble Member of the Division Bench arrived at the opinion that the permit in question deserves to be quashed and the other Honble member opined that there is no cause to quash the per mit in question. Both the Honble Judges recorded their respective opinion separately. (c) Thus, under the order of Honble the Chief Justice of High Court of Judicature at Allahabad referred to above, aforesaid writ peti tion was listed before this Bench. 3. Heard learned Counsel for the par ties, perused the record and opinions recorded by respective Honble Judges forming the Division Bench. The root question involved in this petition is as to whether an employee of the Corporation is capable of entering into any business contract during the course of his employ ment in the Corporation? 4. 3. Heard learned Counsel for the par ties, perused the record and opinions recorded by respective Honble Judges forming the Division Bench. The root question involved in this petition is as to whether an employee of the Corporation is capable of entering into any business contract during the course of his employ ment in the Corporation? 4. Learned Counsel for the petitioner contended that the respondent No. 3 being an employee of the Corporation is dis qualified during the course of this employ ment for entering into any business con tract by virtue of Rule 89 of U. P. State Mineral Development Corporation Ltd. Employee Service Rules, 1978 (for short the Rules) which expressly prohibits the employee of the Corporation from engag ing directly or indirectly in any trade or business or under taking any employment and as such the contract in question is clearly hit by Section 11 of the Indian Contract Act. 5. Learned Counsel further con tended that the Court regards the business contracts entered into by the employees during the course of their employment as immoral and opposed to public policy and, therefore, the contract in question is void ab initio under Section 23 of the Indian Contracts Act. 6. Learned Counsel for the respon dent No. 3 contended that the contract in question may be in violation of Rule 89 of the Rules and for violation of Rule 89, the respondent No. 3 may be held liable for departmental action but it would not render the contract itself null and void. 7. Learned Counsel further con tended that Rule 89 of the Rules having no force of law cannot render the contract illegal or opposed to public policy. 8. In the instant case the position admitted to the parties is that the respon dent No. 3 is an employee of the Corpora tion and he entered into the contract in question during the course of his employ ment. The Corporation is a U. P. Govern ment undertaking and thus is an in strumentality of the State. The Corpora tion has framed its Rules for regulation the service conditions and conduct of its employees. The Corporation is a U. P. Govern ment undertaking and thus is an in strumentality of the State. The Corpora tion has framed its Rules for regulation the service conditions and conduct of its employees. Relevant Rule 89 Reads a$ under: "no employee shall, except with the pre vious sanction of the Corporation, engage directly or indirectly in any trade or business or undertake any employment: Provided that any employee may, without such sanction undertake honorary work of social or charitable nature or occasional work oft a literary artistic or scientific character, subject to the condition that his official duties don not thereby suffer and that he informs his Head of the Department, and when he is himself the Head of the Department, the Corporation, within one month of his undertaking such a work; but he shall not undertake, or shall con tinue such work if so directed by the Corpora tion. " A bare perusal of this provision makes it crystal clear that no employee of the Corporation can engage himself in any trade or business, directly or indirectly, except with previous sanction of the Cor poration, so long he is subject to these Rules or in other words so long he is sub ject to these Rules or in other words so long he is in the employment of the Cor poration. The case of the respondent No. 3 is not that he has obtained previous sanc tion of the Corporation for entering inttt the contract in question. 9. Section 11 of Indian Contract Act which deals about the competency of the parties to a contract reads as under: "11. Who are competent to contract - Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind, and is not disqualified from contracting by any law to which he is subject. " For the purposes of this case the phrase not disqualified from contracting by any law to which he is subject is relevant. Disqualification from contract ing by any law to which a contracting party is subject is one of the incapacities which renders an agreement unenforceable by law. " For the purposes of this case the phrase not disqualified from contracting by any law to which he is subject is relevant. Disqualification from contract ing by any law to which a contracting party is subject is one of the incapacities which renders an agreement unenforceable by law. The point for determination in a case involving this kind of incapacity is whether the particular contracting party is dis qualified by any law to which he is subject from entering into the contract in ques tion. In the instant case the Employees Service Rules is the relevant law to which respondent No. 3 is subject, so long he is in the employment of the Corporation. Rule 89 of the said Rules expressly disqualifies respondent No. 3 from entering into the contract in question. Thus, the irresistible conclusion is that on the date of entering into contract in question, respondent No. 3 being in the employment of the Corpora tion, was not having capacity to enter into the contract in question within the mean ing of Section 11 of the Indian Contract Act, by virtue of Rule 89 which is the relevant law to which he is subject. 10. The matter can be viewed from other angle also. The service of the Cor poration is itself a contract entered into by the respondent No. 3 with the Corpora tion. One of the terms and conditions of this contract (vide Rule 89) is that the respondent No. 3 shall not enter into any other trade business or employment, ex cept with the previous sanction of the Cor poration. Thus, the subsequent contract i. e. the contract in question is clearly viola-tive of the previous contract i. e. the con tract of service with the Corporation and therefore, the contract in question is in valid. 11. Now it is to be examined as to whether the contract in question is in con formity with the provisions of Section 23 of Indian Contract Act which reads as under: "23. 11. Now it is to be examined as to whether the contract in question is in con formity with the provisions of Section 23 of Indian Contract Act which reads as under: "23. What considerations and objects are lawful and what not - The consideration or ob ject of an agreement is lawful, unless – it is forbidden by law; or is of such nature that, if permitted, it would defeat the provisions of any law; or is fraudulent; or involves or implies injury to the person or property of another; or the court regards it as immoral, or op posed to public policy. " The principle of public policy is this. Exdolomanonon oritur action i. e. no Court will lend its aid to a man who founds his cause of action upon an immoral or an illegal Act. No doubt, there cannot be any comprehensive formula or classification of work relating to public policy. Rules of public policy have verily to be molded to suit new conditions of changing world and the use of judicial precedence is very help ful in this regard. Public policy does not remain static in any given community. It may vary from generation to generation and even in the same generation. Public policy would be almost useless it it were to remain in fixed moulds for all time. The difficulty of discovering what public policy is at any given moment certainly does not absolve the Judges from the duty of doing so. In conducting an enquiry, Judges are not hide-bound by precedent. The Judges must look beyond the narrow field of past precedents, though this still leaves opt-n the question, in which direction they must cast their gaze. (See Associated Cement Companies Ltd, v. State of Rajasthan, AIR 1981 Raj 133 at p. 137) In this era of transparency and ac countability, the State, its instrumentality and their employees have to be held ac countable to the law to which they are subject. From no point of view they can be allowed to flout the law, statutory or non-statutory, to which they are subject. From no point of view they can be allowed to flout the law, statutory or non-statutory, to which they are subject. In case the employees of States or its instrumen tality or corporations are allowed to enter into other trades or businesses violating the Rules and Regulations to which they are subject during their such employment, it would amount to permit them to flout the law to which they are subject during their employment. In that event it would be a sort of encouragement for the employees to commit misconducts of course at the risk of disciplinary actions, but the accountability of the employees to the law to which they are subject shall become meaningless. After giving my thoughtful considerations to the facts and circumstances of the instant case and the law on the subject I am of the firm opinion that accountability to law is the best public policy so as to ensure the rule of law in the country. 12. Therefore, if the Rules or law, statutory or non-statutory, to which the employee is subject, does not permit an employee to enter into any trade or busi ness during such employment and despite that he enters into any contract of trade or business violating those Rules or laws, such contracts would be immoral and op posed to public policy. In case such employees are interested in getting such business contracts, for any reason what soever, it is always open for them to enter into such contracts but for that they will have to first get rid of those service Rules or laws to which they are subjected by virtue of being in such employment. Thus, they may enter into such contracts only after relinquishing such employments and not during the the course of such employ ments. 13. In Lala Han Kishun Das v. Chaudhri Mohammed Safi Jain, AIR 1924 Oudh 438, considering the provisions of Contract Act in respect of disqualified per sons, their Lordships have also rule that the contracts by disqualified persons are null and void. Similar view has also been taken in (Lai) Chandradwaj Deo v. (Lai) Artran Deo, AIR 1936nagpur 15. 14. 13. In Lala Han Kishun Das v. Chaudhri Mohammed Safi Jain, AIR 1924 Oudh 438, considering the provisions of Contract Act in respect of disqualified per sons, their Lordships have also rule that the contracts by disqualified persons are null and void. Similar view has also been taken in (Lai) Chandradwaj Deo v. (Lai) Artran Deo, AIR 1936nagpur 15. 14. Here it would not be out of con text to mention that the impact of dis qualification for the contract cannot be brushed aside inasmuch as if a disqualified person has received any advantage under the contract for which he is disqualified, such disqualified person is bound to re store it under Section 65 of the Contract Act. Thus, on the facts and circumstances of instant case if it is found that the respon dent No. 3 has received any advantage under the contract in question for which he is disqualified as discussed above, it would be open for the authorities concerned to get the same restored. Where the benefit is derived by a disqualified person under contract the doctrine of restitution inter regnum comes into play which means that whatever benefit is derived by the dis qualified person it has to be restored. 15. In view of the discussions made above I am of the considered opinion that the contract in question is null and void being hit by Sections 11 and 23 of the Contract Act and therefore, the permit granted to respondent No. 3 during the course of his employment with the Cor poration, is liable to be quashed. 16. I have not referred various decided cases on the point as almost all cases relevant on the point have been referred and discussed suitably for and against by both the Honble Judges in their respective opinions and therefore, the repetition of the same would unnecessari ly make the judgment bulky. 17. Since the reference is made to this Bench under Chapter VIII, Rule 3 of the Rules of the Court hence the matter be laid along with my opinion before the Division Bench consisting of Honble Mr. Justice Palok Basu and Honble Mr. Justice M. C. Agarwal for final disposal of the writ peti tion accordingly. Office is directed to list this case before the Division Bench con cerned at the earliest. Reference answered. .