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1999 DIGILAW 797 (RAJ)

Surendra Pal Singh TT v. Union of India

1999-07-05

ASHOK PARIHAR

body1999
JUDGMENT 1. - The State Government, vide order dated 25.6.1998, nominated the petitioner to the Board of Directors of Rajasthan State Warehousing Corporation as representative of the agriculture producers. The above nomination was made in place of one Shri Ram Nath Verma, who was in the Board of Directors earlier in the same capacity. By another order dated 26.6.1998, the petitioner was also appointed as Chairman of the Rajasthan State Warehousing Corporation under section 20(2) of Warehousing Corporation Act, 1962 (hereinafter to be referred to as the Act of 1962) read with rule 3(c) of the Rajasthan State Warehousing Corporation Rules, 1975 (hereinafter to be referred to as the Rules of 1975). 2. Subsequently, the State Government issued an order dated 31.12.1998 by which Shri N.R. Bhasin, Principal Secretary, Agriculture Department, Government of Rajasthan was appointed as Director and Chairman of the Corporation in place of the petitioner. Taking it to be the order of removal, the same has been challenged by the petitioner in the present writ petition. 3. While issuing notices to the Advocate General on 8.1.1999, this court ordered that if the petitioner has not relinquished the charge as yet, status quo shall be maintained till the next date. The case was ordered to be fixed on 12.1.1999. It was further made clear that the petitioner shall not pass any order in regard to any policy or otherwise concerning the functioning of the Corporation except the orders which are required in the routine manner. It was also made clear that if the petitioner violates the directions referred to above, serious view will be taken of the same. 4. On 13.1.1999, the interim order passed on 8.1.1999 was further modified to the extent that the petitioner would not attend the office but all facilities which were being granted to him before passing impugned order shall be allowed to be continued to the petitioner. 5. Mr. C.K. Garg, learned counsel for the petitioner, with all vehemence at his command, has contended that the State Warehousing Corporation was established under the provisions of the Act of 1962, the Directors and the Chairman of the Corporation could be nominated/appointed and further removed under the provisions of the Act of 1962 only. 5. Mr. C.K. Garg, learned counsel for the petitioner, with all vehemence at his command, has contended that the State Warehousing Corporation was established under the provisions of the Act of 1962, the Directors and the Chairman of the Corporation could be nominated/appointed and further removed under the provisions of the Act of 1962 only. The submission of Shri Garg is that it is only under section 22, the Board of Directors may remove from office any Director and in case of the Chairman, the State Government may remove him with previous approval of the Central Warehousing Corporation and after giving him a reasonable opportunity of showing cause against the proposed removal. Since the petitioner was nominated/appointed as Director and subsequently as Chairman of the Corporation, the State Government could not have removed him in such an arbitrary manner without either seeking prior approval of the Central Warehousing Corporation or without even affording any opportunity of hearing as provided under section 22 of the Act of 1962. 6. Mr. Garg has further submitted that even if the State Government has powers to rescind or modify the nomination of the Directors (official or non-official) as provided under proviso to rule 4 of the Rules of 1975, the said proviso is bad in law and ultra vires to the Constitution of India because the same is not in consonance with the provisions of the main Act of 1962. 7. Relying on the reply filed on behalf of the respondent-State, while assailing the "doctrine of pleasure" and "removal of appointment/nomination on the political considerations", great emphasis has also been made by learned counsel for the petitioner that while issuing the impugned order dated 31.12.1998, appointing Mr. N.R. Bhasin as Director and Chairman of the Corporation, no prior approval was sought from the Central Warehousing Corporation as provided under section 22 of the Act of 1962. 8. Mr. Garg has also contended that since civil consequences were involved in the present matter, the petitioner should have been given an opportunity of hearing prior to his removal before expiry of 3 years tenure fixed under the order of his initial nomination. 9. Mr. Garg, while citing various judgments of this court, other High Courts and the Apex Court has mainly relied on the judgment of this court in case of Kanta Devi Vs. State of Rajasthan (1957 RLW 69) , Manik Chand Surana Vs. 9. Mr. Garg, while citing various judgments of this court, other High Courts and the Apex Court has mainly relied on the judgment of this court in case of Kanta Devi Vs. State of Rajasthan (1957 RLW 69) , Manik Chand Surana Vs. State of Rajasthan & Ors. ( 1993(1) RLR 105 =1993(2) WLC 49) , Prof BL Verma v. State of Rajasthan & ors in SB Civil Writ Petition No. 1476/1993, decided on 28.6.1993 and also judgment of Apex court in B.B. Rajwanshi v. State of UP and others reported in AIR 1988 SC 1089 , Dr Rashmi Srivastava v. Vikram University and others ( (1995) 3 SCC 653 ) , Mohinder Singh Gill & another v. The Chief Election Commissioner, New Delhi & others ( (1978) 1 SCC 405 ) , SL Kapoor v. Jagmohan & others ( (1980) 4 SCC 379 ) and Kumari Shrilekha Vidyarthi etc. v. State of UP & others ( AIR 1991 SC 537 ) . 10. Mr. S.M. Mehta, learned Advocate General appearing on behalf of the State, while referring to the relevant provisions of the Rules of 1975, has submitted that the nomination of the petitioner itself was purely on political considerations, as such, under proviso to rule 4 of the Rules of 1975 the State Government could any time rescind or modify the nomination of any Director. The impugned order has been passed strictly as per provisions of the Rules 1975. It has further been contended that since it was purely a political appointment, no stigma is attached to the removal of the petitioner and even no opportunity of hearing was required to be made in the present matter. He has relied on the judgment of the Apex Court in case of Om Narain Agarwal & others v. Nagar Palika, Shahjahanpur and others reported in ( 1993(2) SCC 242 ) . 11. Mr. Mehta has also contended that since tenure for Directors and Managing Director has not been fixed under the Act of 1962, the same could be provided only under the appropriate Rules to be framed by the State Government under section 41 of the Act of 1962. In the present case, the tenure has been fixed as three years in the rules of 1975, the provisions in regard to manner of terminating the tenure could also be provided in the same. 12. Mr. In the present case, the tenure has been fixed as three years in the rules of 1975, the provisions in regard to manner of terminating the tenure could also be provided in the same. 12. Mr. Mehta has also referred to the Central Warehousing Corporation Rules, 1963, framed under section 41 of the Act of 1962 in which the tenure of two non-official Directors has been fixed as two years from the date of nomination and it has further been provided that they shall hold the office during the pleasure of the Central Government. 13. After having considered the submissions made by learned counsel for the parties, I have carefully gone through the judgments cited by learned counsel for both the sides, material on record and also the original file of the appointment of the petitioner as Director and Chairman of the Corporation, as submitted by learned Advocate General for perusal of the Court. 14. Before dealing with the facts and merits of the case I would like to refer the relevant provisions of the Act of 1962 and the Rules of 1975. 15. Section 20 of the Act of 1962 deals with the general superintendence and management of the affairs of a State Warehousing Corporation. The relevant portion is reproduced herein as under: "20. (1) The general superintendence and management of the affairs of a State Warehousing Corporation shall vest in a board of directors which shall consist of the following, namely: (a) five directors nominated by the Central Warehousing Corporation of whom one shall be nominated in consultation with the State Bank and one at least shall be a non-official; (b) five directors nominated by the State Government; and (c) a managing director, appointed by the State Government in consultation with the directors referred to in clauses (a) and (b) and with the previous approval of the Central Warehousing Corporation. (2) The Chairman of the Board of directors shall be appointed by the State Government from amongst the directors of the State Warehousing Corporation with the previous approval of the Central Warehousing Corporation." 16. Section 21 deals with the disqualification for office of Director of the State Warehousing Corporation, which is being reproduced herein as under: "21. (2) The Chairman of the Board of directors shall be appointed by the State Government from amongst the directors of the State Warehousing Corporation with the previous approval of the Central Warehousing Corporation." 16. Section 21 deals with the disqualification for office of Director of the State Warehousing Corporation, which is being reproduced herein as under: "21. A person shall be disqualified for being chosen as, and for being, a director of a State Warehousing Corporation:- (i) if he is found to be a lunatic or becomes of unsound mind; and (ii) if he is, or at any time has been, adjudicated insolvent or has suspended payment of his debts or has compounded with his creditors; or (iii) if he is or has been convicted of any offence involving moral turpitude and sentenced in respect thereof to imprisonment for not less than six months, unless a period of five years has elapsed from the date of expiry of the sentence; or (iv) if he has been removed or dismissed from service of Government or a corporation owned and controlled by the Government, or (v) except in the case of the managing director, if he is a salaried official of the Central Warehousing Corporation or a State Warehousing Corporation; or (vi) if he is personally interested in a subsisting contract made with, or in any work being done for, the State Warehousing Corporation except as a shareholder (other than a director) in any public company as defined in the Companies Act, 1956: Provided that where any such person is a shareholder, he shall disclose to the Warehousing Corporation the nature and extent of the shares held by him in such company." 17. Section 22 deals with removal of Directors from office and the same is reproduced herein as under: "22 (1) The State Government may, at any time, with the previous approval of the Central Warehousing Corporation, remove the Managing Director from office after giving him a reasonable opportunity of showing cause against the proposed removal. Section 22 deals with removal of Directors from office and the same is reproduced herein as under: "22 (1) The State Government may, at any time, with the previous approval of the Central Warehousing Corporation, remove the Managing Director from office after giving him a reasonable opportunity of showing cause against the proposed removal. (2) The Board of Directors may remove from office any Director who:- (a) is or has become subject to any of the disqualifications mentioned in section 21; or (b) is absent without leave of the Board of Directors for more than three consecutive meetings of the board without sufficient cause, in the opinion of the Board, to exonerate his absence." Section 41 is in regard to framing of Rules. The relevant portions are quoted herein below: "41(1) The appropriate Government may, by notification in the Official Gazette, make rules to carry out the purpose of this Act. (2) Without prejudice to the generality of the foregoing power, such rules may provide for (a) ..... (b) the manner of nomination and election of the directors of the Central Warehousing Corporation and the period within which such directors shall be nominated or elected; (c) the term of office of, and the manner of filling casual vacancies among, and the remuneration payable to, the directors of a Warehousing Corporation. (d) to (i) ....... (j) any other matter which has to be or may be prescribed." Rule 3 of the Rules of 1975 provides for nomination of Directors. The same is reproduced herein below: "3. Nomination of Directors: (a) Five Directors shall be nominated by the Central Warehousing Corporation out of whom one shall be in consultation with the State Bank and one at least shall be a non-official. (b) Five Directors shall be nominated by the State Government from amongst the following:- (i) The Secretary to Government of Rajasthan, Agriculture Department; (ii) A representative of Finance Department, Government of Rajasthan, at least of the status of Deputy Secretary; (iii) The Registrar or Additional Registrar, Co-operative Societies, Rajasthan; (iv) a representative of Food Department, Government of Rajasthan; (v) The Director of Agriculture; (vi) The Chairman, Rajasthan State Co-operative Bank; (vii) a representative of the Traders; (viii) a representative of the producers. (c) The Chairman of the Board of Directors shall be appointed by the State Government from amongst Directors of the State Warehousing Corporation with the previous approval of the Central Warehousing Corporation. (d) The Managing Director shall be appointed by the Government in consultation with the Directors deferred to in Sub-rules (a) and (b) and with the previous approval of the Central Warehousing Corporation. 18. Rule 4 provides for terms of office and filling up of casual vacancies from the members of the Board of Directors of the State Warehousing Corporation, which is reproduced here in below: "4. Term of office and filling up of casual vacancies among the members of the Board of Directors of the State Warehousing Corporation: (i) The term of office of every director nominated under Sub-section (a) and (b) of Section 20(1) of the Act shall, in the case of an official director, be for the period for which he continues to hold office, and shall in other cases, be 3 years from the date of his appointment: Provided that it shall be open to the authority competent to nominate the Directors (Official and non-Official) to rescind or modify the nomination any time or renominate a director for a further period of 3 years or till a successor is nominated in his place, whichever is later; (ii) vacancies of the office of director shall be filled up by nomination by the authority competent to nominate; (iii) a non-official member on the Board or the Executive Committee may resign his office as such member by writing under his hand addressed to the Chairman of the Corporation and such resignation shall be effective from the date on which it is accepted by the Board." 19. Rule 3 of the Central Warehousing Corporation Rules, 1963 provides for nomination of directors and the same is reproduced herein below: "3. Rule 3 of the Central Warehousing Corporation Rules, 1963 provides for nomination of directors and the same is reproduced herein below: "3. Nomination of directors: The Central Government, shall nominate the following persons as directors under clause (a) of sub-section (1) of section 7, namely:- (i) a representative of the Ministry of Food & Civil Supplies (Department of Food), Government of India, (ii) a representative of the Ministry of Finance (Department of Expenditure) Government of India, or the Financial Advisor of the Department of Food, (iii) a representative of the Central Board of Excise and Customs, Ministry of Finance (Department of Revenue), (iv) the Managing Director of Food Corporation of India, and (v) two non-officials, preferably representing farmers or exports in marketing, management of administration." 20. Rule 4 of the above Rules of 1963 further provides for term of office of directors and filling of casual vacancies among directors. The relevant portion is reproduced herein below: "4. Term of Office of directors and filling of casual vacancies among directors: In Rule 4 of the said rules, for sub-rule (1), the following sub-rule shall be substituted, namely: (1) The terms of office of the non-official Directors nominated under clause (v) of rule 3 shall be two years from the date of the nomination of such Directors and they shall hold office during the pleasure of the Central Government." 21. The Rules of 1975 have been framed in exercise of the powers conferred by section 41 of the Act of 1962. The Board of Directors consists of five Directors to be nominated by the Central Warehousing Corporation and five Directors to be nominated by the State Government from amongst the 8 categories mentioned above. The last two categories i.e. representative of the traders and the representative of the producers can safely be termed as non-official member of the Board. 22. As it transpires from the original file of the State Government in regard to appointment of the Directors and the Chairman of the State Warehousing Corporation, earlier, Mr. Ram Nath Verma and Mr. Mahesh Periwal were nominated as Directors in the capacity of representative of producers and representative of traders respectively vide order dated 16.5.1994 for three years. The tenure of both the above persons was further extended for another three years as Director in the same capacity vide order dated 22.10.1997. 23. Ram Nath Verma and Mr. Mahesh Periwal were nominated as Directors in the capacity of representative of producers and representative of traders respectively vide order dated 16.5.1994 for three years. The tenure of both the above persons was further extended for another three years as Director in the same capacity vide order dated 22.10.1997. 23. Thereafter, a note was sent by the Secretary to the Chief Minister to the Secretary, Agriculture on 25.6.1998 that the Chief Minister has desired that the petitioner may be nominated as non-official Director in the Rajasthan State Warehousing Corporation and also appointed as Chairman of the Corporation having the status of Minister of State. Bio-data of the petitioner was also sent along with the note. 24. It further transpires from the nothings of the file that the petitioner could be nominated in place of Shri Ram Nath Verma as Director, being representative of the producers, under proviso to rule 4 of the Rules of 1975. However, for appointment of the petitioner as Chairman of the Board of Directors in the State Warehousing Corporation, the previous approval of Central Warehousing Corporation was required to be sought. In view of a note given by the Chief Secretary, the approval was sought to waive the above requirement in making appointment of the Chairman and it was proposed that ex post facto approval can be sought since the petitioner was also to be given the rank of Minister of State. The note given by the Chief Secretary, as referred to above, is reproduced herein as under : "Looking to the sensitivity involved in the Central State relations these days, they are bound to be problems in getting prior approval. It is infra dig for a Government to obtain prior approval of Central Warehousing Corporation for making senior appointment of Chairman and Managing Director." 25. Subsequently, the petitioner was first nominated as Director in the capacity of representative of agriculture producer in place of Shri Ram Nath Verma vide order dated 25.6.1998 and thereafter was also appointed as Chairman of the State Warehousing Corporation vide order dated 26.6.1998. The rank of Minister of State was also bestowed on the petitioner while working as Chairman of the State Warehousing Corporation vide order dated 27.6.1998. 26. The rank of Minister of State was also bestowed on the petitioner while working as Chairman of the State Warehousing Corporation vide order dated 27.6.1998. 26. The letter of ex post facto approval to the appointment of the petitioner as Chairman was sent to the Managing Director, Central Warehousing Corporation only on 24.7.1998 and even the post facto approval so far as the petitioner is concerned has not been received from the Central Warehousing Corporation till date. 27. From the facts as narrated above, it can well be gathered that the appointment of the petitioner as Director and the Chairman of the State Warehousing Corporation was nothing but a political appointment taking recourse to the proviso to rule 4 of the Rules of 1975. The bio data as available on file clearly shows that the petitioner was an active member of the political party then in power. It does not lie in the cheeks of the petitioner now to challenge the validity of the same proviso and contend that his nomination as Director cannot be withdrawn on political considerations. The tenure of Shri Ram Nath Verma had also not expired at the time of nomination of the petitioner as Director in his place. 28. The contention of learned counsel for the petitioner that the petitioner could be removed only under the provisions of section 22 of the Act of 1962 by the Board of Directors also does not hold good because the Board of Directors have only been given the additional powers to remove any Director from the office in certain contingencies referred in the section itself. However, in the present case, in view of the proviso to rule 4, the authority competent to nominate the Director (official or non-official) has also been empowered to rescind or modify the nomination any time. Since it is only a case of nomination on Board of Directors, I find nothing wrong in the above provision and the same in no way can be called as arbitrary or ultra vires to the Constitution. Even the Central Warehousing Corporation Rules have a similar provision of pleasure of the Central Government. 29. Since it is only a case of nomination on Board of Directors, I find nothing wrong in the above provision and the same in no way can be called as arbitrary or ultra vires to the Constitution. Even the Central Warehousing Corporation Rules have a similar provision of pleasure of the Central Government. 29. Furthermore, at the time of his nomination as Chairman of the Corporation, the petitioner was aware of the above provisions in the Rules of 1975 and, as a matter of fact, the petitioner himself was nominated/appointed under the same provision, he now cannot be allowed to challenge the validity of the same provision in the present writ petition. 30. In (10) R.L. Gosain v. Yashpal Dhir ( AIR 1993 SC 352 ) the Hon'ble Supreme Court has observed as under: "Law does not permit a person to both approbate and reprobate. This principle is based on the doctrine of election which postulates that no party can accept and reject the same instrument and that a person cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on the footing of its validity, and then turn round and say it is void for the purpose of securing some other advantage." 31. The Apex Court in the case of Om Narain Agrawal (supra) has dearly observed that the right to seek an election or to be elected or nominated to a statutory body, depends and arises under a statute. If such appointments made initially by nomination are based on political considerations, there can be no violation of any provision of the Constitution in case the Legislature authorised the State Government to terminate such appointment at its pleasure and to nominate new members in their place. The Apex Court has further observed that any such provisions neither offends any Article of the Constitution nor the same is against any public policy or democratic norms enshrined in the Constitution. The Court also observed that there is no question of any violation of principles of natural justice in not affording any opportunity to the nominated members before their removal nor the removal under the pleasure doctrine nor such matters puts any stigma on the performance or character of the nominated member. 32. The Court also observed that there is no question of any violation of principles of natural justice in not affording any opportunity to the nominated members before their removal nor the removal under the pleasure doctrine nor such matters puts any stigma on the performance or character of the nominated member. 32. In the present case, since there is a special provision under the relevant rules in regard to rescind or modifying the nomination any time, in view of the observations made by the Apex Court in case of Om Narain Agrawal (supra) I need not discuss the judgments of this court in case of Kanta Devi (supra) and Manik Chand Surana (supra). Even in a subsequent judgment of this court in case of Prof. B.L. Verma (supra), this court has observed that in view of the judgment of the Supreme Court in the case of Om Narain Agarwal (supra) the judgments of this court in the case of Kanta Devi and Manik Chand Surana (supra) require reconsideration. 33. The judgments cited by learned counsel for the petitioner in regard to violation of principles of natural justice and giving opportunity of hearing also do not require any further consideration in view of the discussion made above. 34. The great statesman Lincoln once said that "you can make fool out of some people for all the time, you can make fool out of all the people some of the time but you cannot make fool out of all the people all the time". In the facts and circumstances of the present case, I find no ground for any interference of this court under its writ jurisdiction. 35. A huge amount has been spent from the State exchequer on the petitioner after his removal without any work or responsibility been assigned to him. I would have ordered for recovery of whole of the amount from the petitioner, however, since the petitioner enjoyed all the facilities and perks including salary as per the interim order passed by this court as earlier referred to above, I would not like to pass any order in this regard. 36. Mr. I would have ordered for recovery of whole of the amount from the petitioner, however, since the petitioner enjoyed all the facilities and perks including salary as per the interim order passed by this court as earlier referred to above, I would not like to pass any order in this regard. 36. Mr. Garg, learned counsel for the petitioner also referred to some application filed by the petitioner during the course of hearing in regard to non-compliance of the interim order passed by this court, however, since the writ petition itself is being decided finally, no separate orders are required to be passed on the application. 37. Accordingly, I find no merit in the writ petition and the same is dismissed with costs of Rs. 10,000/- (Rupees ten thousand only).Petition Dismissed with costs. *******