UNION OF INDIA v. Staff Council, Chief Pay & Accounts Organization
2012-02-07
ANIRUDDHA BOSE, MRINAL KANTI SINHA
body2012
DigiLaw.ai
Judgment :- Aniruddha Bose, J. This appeal arises out of a judgment and order passed by a learned Single Judge of this Court on 23rd September, 2011 in W.P. No. 1052 of 2011, issuing a Writ of quo-warranto directing Shri N.P. Pillai, respondent no.7 in the writ petition to relinquish the post to which he was appointed. Said N.P. Pillai has been impleaded as the proforma respondent before us. The appointment, which was challenged before the learned First Court was effected on 29th April, 2011, was as Consultant(Finance). The learned First Court also directed that all acts and deeds done by him shall be rendered void. The order, being Order No.40 was signed by the Pay & Accounts Officer-IV and this order recorded that the Lieutenant Governor, A & N Islands had been pleased to order such engagement. It was also recorded in the order that such engagement was being made initially for a period of six months or till the post of Director (Finance) was filled up on regular basis, whichever was earlier, in public interest. The petitioners before the learned First Court were an association, being the Staff Council, Chief Pay & Accounts Organization, the President and Vice-President of the said Organization and five employees of the accounts departments of different public authorities in Port Blair. It has been pleaded in the writ petition that the petitioner nos.4 and 5 were eligible for the said post to which the proforma respondent had been engaged. The basic complaint of the petitioners is that such appointment was not in terms of Rule 168(1) of the General Financial Rules which deals with appointment of Consultants under the Central Government. We shall henceforth refer to these rules as GFR. Rule 163 of the GFR empowers the Ministries or departments to hire external consultancy firms and consultants for a specific job and Rule 165 stipulates that engagement of such consultant may be deserved to any situation requiring high quality service for which the concerned Ministry/department does not have the requisite expertise. Rule 168(i) stipulates:- “Rule 168. Identification of likely sources.
Rule 163 of the GFR empowers the Ministries or departments to hire external consultancy firms and consultants for a specific job and Rule 165 stipulates that engagement of such consultant may be deserved to any situation requiring high quality service for which the concerned Ministry/department does not have the requisite expertise. Rule 168(i) stipulates:- “Rule 168. Identification of likely sources. - (i) Where the estimated cost of the work or service is upto Rupees twenty-five lakhs, preparation of a long list of potential consultants may be done on the basis of formal or informal enquiries from other Ministries or Departments or Organizations involved in similar activities, Chambers of Commerce & Industry, Association of consultancy firms et.” The proforma respondent had retired from the post of Director of Accounts & Budget of the Administration on 30th April, 2011. He was engaged as a Consultant(Finance) with effect from 1st May, 2011, initially up to 31st October, 2011. Learned First Court found breach of the provisions of the GFR as engagement of the proforma respondent was not in accordance with the provisions of Rule 168. It is admitted position that he was not engaged from any existing list of potential Consultants on the basis of formal or informal inquiries from the various sources specified in the said provision i.e. Rule 168(i). This is the main ground on which his appointment was quashed. The appellants before us are Union of India and the different authorities of Andaman and Nicobar Administration. Mr. Tabraiz, learned counsel for the appellants has urged us to set aside the judgement under appeal on the ground that the petitioners did not have the locus standi to maintain the writ petition. His contention is that temporary appointment of a superannuated officer as a Consultant does not constitute appointment to any public or civil post and Writ of quo warranto does not lie in respect of engagement to the post of Consultant as such engagement is not done on the basis of any statutory rule. So far as GFR is concerned, he submitted that this is a mere administrative or executive guideline, not having any statutory strength and appointment made following such guidelines would not constitute appointment to any statutory post. The second limb of his argument is that such appointment was not made in accordance with Rule 168(1) but under Rule 176, which stipulates:- “Rule 176. Consultancy by nomination.
The second limb of his argument is that such appointment was not made in accordance with Rule 168(1) but under Rule 176, which stipulates:- “Rule 176. Consultancy by nomination. - Under some special circumstances, it may become necessary to select a particular consultant where adequate justification is available for such single-source selection in the context of the overall interest of the Ministry or Department. Full justification for single source selection should be recorded in the file and approval of the competent authority obtained before resorting to such single-source selection.” He also submitted that this was only a temporary appointment to meet the exigencies of situation and the Administration had already approached the Union Public Service Commission for filling up the post of Director(Finance). He also argued that subsequent to his initial appointment, an order extending his engagement has been passed but this order of extension has not been challenged and the original order of his engagement has lost its force and this ground dismissal of the writ petition ought to have been made. Mr. Tabraiz also submitted, on instruction that the authorities are also not likely to extend his engagement after the expiry of the present term and the post of Director (Finance) is likely to be filled up through regular channel either by way of deputation or on contract basis and such engagement shall be done through an open selection process by way of advertisement. His further submission on this count is that in the event a consultant is required to be engaged in the post the proforma respondent is holding, then such post would be advertised. He relied on a note relating to appointment of Shri Pillai to justify the exercise of special power under Rule 176. This note records:- “This is regarding appointment of Consultant (Finance) under A & N Administration. In this regard, it is submitted that, Shri N.P. Pillai, Director(Finance)/Director of Accounts & Budget is retiring on attaining the age of superannuation w.e.f. 30.04.2011 (A/N) after rendering more than 36 years of service under A & N Administration. He is looking after the full duties of the post of Director(Fin.) in addition to his normal duties since 2005 onwards. The Finance department looks after the financial matters of A & N Administration. The proposals which require the financial concurrence are being routed through Director(Finance) to the Principal Secretary(Finance).
He is looking after the full duties of the post of Director(Fin.) in addition to his normal duties since 2005 onwards. The Finance department looks after the financial matters of A & N Administration. The proposals which require the financial concurrence are being routed through Director(Finance) to the Principal Secretary(Finance). Therefore till a suitable person is appointed as Director (Finance) by A & N Administration, the services of Shri N.P. Pillai may be utilized in public interest. In terms of Rule 165 of GFR, 2005 engagement of consultants can be resorted to in situations requiring high quality services for which the concerned ministry does not have requisite expertise. Further as per Rule 167 of GFR, 2005, Ministry or department proposing to engage consultant should estimate reasonable expenditure for the same by ascertaining the prevalent market conditions and consulting other organizations engaged in similar activities. Therefore, it is proposed to engage Shri N.P. Pillai, Director of Accounts & Budget “Consultant(Finance)” against the vacant post of Director(Finance) on a consolidated remuneration of Rs. 28,400/-(Rupees twenty eight thousand four hundred only) (Calculation of remuneration is at Flag ‘A’) subject to the condition that the fee plus pension dearness pension should not exceed the last pay drawn, for a period of six months w.e.f 01/05/2011 to 31/10/2011 or till the post is filled on regular basis whichever is earlier subject to a review after six months in public interest. He will not however be entitled for any other benefits including residential accommodation during the period of engagement. The post of DAB, A & N Administration is to be filled up by promotion in consultation with UPSC, New Delhi. A proposal to take up the case with UPSC is being put up in a separate file and till the post is filled up on regular basis the senior most Senior Accounts Officer if this organisation will be given the charges of DAB in addition to his own duties without any extra remuneration. A proposal in this regard will be put up separately.” He has also questioned the legality of the order to the extent all acts done by the proforma respondent has been directed to be rendered void. Relying on a judgement of this Court in the case of Puranlal Lakhanpal -Vs.- Dr.
A proposal in this regard will be put up separately.” He has also questioned the legality of the order to the extent all acts done by the proforma respondent has been directed to be rendered void. Relying on a judgement of this Court in the case of Puranlal Lakhanpal -Vs.- Dr. P.C. Ghosh and others ( AIR 1970 Cal 118 ), he submitted that invalidation of all acts done by him ought not to have been directed. On behalf of the writ petitioners/respondents, Ms. Anjili Nag argued in support of the judgement. Her case is that the plea of exercise of power under Rule 176 was an afterthought and never taken before the learned First Court. Her further submission on the point of maintainability of an action for quo warranto is that what was sought to be done by the Administration in this case was to engage the proforma respondent in the post of Director(Finance) only. The post of Director (Finance) is a civil post and the entire exercise of engaging a Consultant was to camouflage the appointment of the proforma respondent as Director(Finance) which would not have been permissible under the Fundamental Rules 56. He would have been disentitled to be engaged on his retirement under the said Rules. Her alternative submission on the point of statutory force of GFR is that the original Finance Rules were adopted in the year 1947 and there was modification to such rules in the year 1963 and the present Rules i.e. General Financial Rules, 2005 is also a further modification and hence is protected under Article 313 of the Constitution. On the issue of maintainability of the petition, she submitted that the writ petitioner nos.4 and 5 are otherwise eligible for being engaged in the said post of Consultant. Since the entire engagement process has been undertaken through an opaque tunnel and not by way of public selection process they are aggrieved individually by such appointment. Even if the GFR does not have statutory strength, then this being the norms set down by the authorities themselves, they ought to follow such norms. Different authorities have been cited by the learned counsel appearing for the respective parties in course of hearing. We shall refer to in this judgement only those authorities which we found relevant for adjudication of this appeal.
Different authorities have been cited by the learned counsel appearing for the respective parties in course of hearing. We shall refer to in this judgement only those authorities which we found relevant for adjudication of this appeal. First, we shall deal with the question as to whether a writ in the nature of quo warranto could be maintained against engagement of the proforma respondent. The question of maintainability of an action in which Writ in the nature of quo warranto has been sought had been examined by two Constitution Bench of the Supreme Court in the cases of University of Mysore v. C.D. Govinda Rao reported in AIR(1965) SC 491 and B.N. Nagrajan v. State of Mysore reported in AIR 1966 SC 1942 . In the case of C.D. Govinda Rao(supra) the scope of the writ of quo-warranto was examined and it was held:- “The judgment of the High Court does not indicate that the attention of the High Court was drawn to the technical nature of the writ of quo-warranto which was claimed by the respondent in the present proceedings, and the conditions which had to be satisfied before a writ could issue in such proceedings. As Halsbury has observed: “An information in the nature of a quo warranto took the place of the obsolete writ of quo warranto which lay against a person who claimed or usurped an office, franchise, or liberty, to enquire by what authority he supported his claim, ir order that the right to the office or franchise might be determined.” Broadly stated, the quo warranto proceeding affords a judicial enquiry in which any person holding an independent substantive public office, or franchise, or liberty, is called upon to show by what right he holds the said office, franchise or liberty; if the inquiry leads to the finding that the holder of the office has no valid title to it, the issue of the writ of quo-warranto ousts him from that office. In other words, the procedure of quo-warranto confers jurisdiction and authority on the judiciary to control executive action in the matter of making appointments to public offices against the relevant statutory provisions; it also protects a citizen from being deprived of public office to which he may have a right.
In other words, the procedure of quo-warranto confers jurisdiction and authority on the judiciary to control executive action in the matter of making appointments to public offices against the relevant statutory provisions; it also protects a citizen from being deprived of public office to which he may have a right. It would thus be seen that if these proceedings are adopted subject to the conditions recognized in that behalf, they tend to protect the public from usurpers of public office; in some cases, persons not entitled to public office may be allowed to occupy them and to continue to hold them as a result of the connivance of the executive or with its active help, and in such cases, if the jurisdiction of the courts to issue writ of quo-warranto is properly invoked, the usurper can be ousted and the person entitled to the post allowed to occupy it. It is thus clear that before a citizen can claim a writ of quo-warranto, he must satisfy the court, inter alia, that the office in question is a public office and is held by usurper without legal authority, and that necessarily leads to the enquiry as to whether the appointment of the said alleged usurper has been made in accordance with law or not.” This scope of quo-warranto was further examined by another Constitutional Bench of India in the case of Centre for PIL v. Union of India reported in (2011) 4 SCC 1 . It was held in this judgement:- “The procedure of quo-warranto confers jurisdiction and authority on the judiciary to control executive action in the matter of making appointments to public offices against the relevant statutory provisions. Before a citizen can claim a writ of quo warranto he must satisfy the court inter alia that the office in question is a public office and it is held by a person without legal authority and that leads to the inquiry as to whether the appointment of the said person has been in accordance with law or not. A writ of quo -warranto is issued to prevent a continued exercise of unlawful authority.” The question as to whether appointment made under an administrative guideline could give rise to quo warranto or not was examined by the Supreme Court in the case of Syndicate Bank Vs. Ramachandran Pillai reported in 2011-ILR(Ker).
A writ of quo -warranto is issued to prevent a continued exercise of unlawful authority.” The question as to whether appointment made under an administrative guideline could give rise to quo warranto or not was examined by the Supreme Court in the case of Syndicate Bank Vs. Ramachandran Pillai reported in 2011-ILR(Ker). It was held in this judgement:- “If any executive instructions are to have the force of statutory rules, it must be shown that they were issued either under the authority conferred on the Central Government or a State Government or other authority by some Statute or the Constitution. Guidelines or executive instructions which are not statutory in character, are not ‘laws’, and compliance thereof can not be enforced through courts. Even if there has been any violation or breach of such non-statutory guidelines, it will not confer any right on any member of the public, to seek a direction in a court of law, for compliance with such guidelines. An order validly made in accordance with a statute (as in this case, the Public Premises Act), cannot be interfered with, even if there has been any transgression of any guidelines, except where it is arbitrary or mala fide or in violation of any statutory provision. These are well settled principles[See: Union of India v. S.L. Abbas 1993(4) S.C.C.357, Chief Commercial Manager, South Central Railway, Secundrabad v. G.Ratnam 2007(8) S.C.C. 212 , and State of U.P. v. GobardhanLal 2004(11) S.C.C. 402 ].” The proposition of law, as it emerges from these authorities is if the post is in question is sought to be filled up on the basis of an administrative guideline or executive instructions, writ of quo warranto would not lie to challenge appointment to such post. That would narrow down the class of persons who could make complaint against such appointment, so far a writ of quo warranto is concerned. To question an appointment to such posts, the petitioners would have to be personally aggrieved. We do not agree with the submissions of the respondents that the source of these rules could be traced back to 1947 to clothe them with the character of statutory rules, in view of the provisions of Article 313 of the Constitution. The title of the rules is General Financial Rules, 2005 and they came into effect from 1st July, 2005.
The title of the rules is General Financial Rules, 2005 and they came into effect from 1st July, 2005. There is no indication in the said Rule that this was being framed in modification of any earlier rule. Ex facie these are rules framed independently. Now the question arises as to whether the post of Consultant was in reality the post of Director(Finance), which in our opinion would be a public post. Submission of Ms. Nag on this point was that to ascertain the nature of post to which the proforma respondent was being appointed, the duties to be discharged by him was to be looked into. In this regard she referred to the decision of the Supreme Court in the case of Mor Modern Cooperative Transport Society Ltd. V. Financial Commissioner & Secretary to Govt. of Haryana and another reported in (2002) 6 SCC 269 . Our attention was drawn to Paragraph 15 of the said judgement in which it was held: “Looking to the scheme of the Act it cannot be disputed that the Regional Transport Authorities exercise powers and perform functions which are conferred upon them by or under Chapter V of the Act. The powers include the power to grant stage carriage permits, attach conditions thereto, to determine the duration of permits and their renewal, to transfer permits, the cancellation and suspension of permits, grant of temporary permits etc. Having regard to the fact that the State undertaking competes with private operators in the business of providing transport service, the legislature advisedly has barred the appointment of any person as a member of the Regional Transport Authority who has any financial interest, whether as proprietor, employee or otherwise in any transport undertaking, which must necessarily include a government undertaking. This is considered necessary with a view to ensure the impartial functioning of the Regional Transport Authority, which is envisaged by the Act.” On the same point, she relied on the judgement of the Supreme Court in the case of Johney D’couto v. State of T.N. reported in (1988) 1 SCC 116 in which it has been observed:- “As has been indicated by this Court, what cannot be permitted directly should not be allowed to be done in an indirect way.” In our opinion, the Administration has made out a case that the posting was temporary in nature.
Even if the proforma respondent was being engaged to discharge the duties of Director(Finance), it was an ad hoc arrangement. Administration has to be given certain latitude in managing its own affairs and if they could not appoint any person immediately on the post of Director(Finance) falling vacant, appointment of the proforma respondent as a Consultant and permitting him to discharge the duties of Director (Finance) as a stop gap measure per se would not constitute his appointment in the said post as an extension, which is prohibited beyond certain age under Fundamental Rule 56. Thus, in our opinion, a Writ in the nature of quo warranto would not lie in seeking invalidation of engagement of the proforma respondent. But this would not restrict our jurisdiction to examine if such engagement otherwise was in accordance with Rules or not. Mr. Tabraiz has argued that the GFR being an executive or administrative instruction, the authorities are not bound by its provisions. We however do not think the authorities have such carte blanche power. In the event the administration has framed its own guideline, if there is irrational departure from it, the same would be unconstitutional and persons aggrieved by such act would be entitled to approach the Writ Court for appropriate relief. So far as the original writ petitioner nos.4 and 5 are concerned, as they could have had competed for the post in question, in our opinion, the writ petition at least should be maintainable at their behest. In the case of T.G.S ltd. V. State of Karnataka reported in AIR 2006 SC 661 , the Supreme Court has observed that the locus standi to maintain a writ application is to be liberally interpreted. Same view had been expressed earlier by the Supreme Court in the case of Air India Statutory Corporation v. United Labour Union reported in (1997) 9 SCC 377 . We shall accordingly examine now as to whether the appointment of the proforma respondent was in accordance with Rules or not. The learned Single Judge primarily relied on Rule 168 for quashing his engagement. The case of the Administration before us is that such engagement was made under Rule 176 which permits them to select a particular consultant where adequate justification is available for such single source selection in the context of the overall interest of the Ministry or department.
The learned Single Judge primarily relied on Rule 168 for quashing his engagement. The case of the Administration before us is that such engagement was made under Rule 176 which permits them to select a particular consultant where adequate justification is available for such single source selection in the context of the overall interest of the Ministry or department. So far as the present case is concerned, the order of his engagement does not specify under which provision of the said Rule he was being engaged. But it is not an absolute necessity that each administrative order should specify the Rule under which the same was being passed. If the source of power can be found to be otherwise legitimate, even wrong reference to a particular provision of law in an order would not invalidate such order. In this case, the reason for such appointment has been indicated in the note to which we have referred to earlier. On the face of it, there is sufficient justification for exercise of such special power. The order of the engagement of the proforma respondent however does not specify that special circumstances exist for such single source selection. Ordinarily, when certain steps are being taken in exercise of emergency situation, the order ought to reflect that the same was being issued to meet such emergency situation. But, in the present case, the order is not directed against any person in particular, like suspension or dismissal of an employee in exercise of emergency power without following the regular stipulated course. Here, the administration has taken the decision to meet a situation which the administration found required immediate steps were to be taken. The note issued reflects the anxiety of the administration and consideration of factors which required them to exercise special power. Thus we do not think the impugned order ought to be vitiated for that reason alone. In the circumstances, particularly having considered the fact that the Administration is seeking to fill up the post through open selection process and engagement of the proforma respondent in the same manner is not going to be effected after his present term expires, we do not think the impugned judgement can be sustained. We find engagement of the proforma respondent to be valid.
We find engagement of the proforma respondent to be valid. As we have found that the engagement of the proforma respondent was temporary arrangement, we are not addressing the other issues raised by the respondents/writ petitioners. The appeal is allowed and engagement of the proforma respondent to the said post is sustained. The judgement under appeal is set aside. There shall be no order as to costs. I agree.