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CASE NO.: Appeal (civil) 1692  of  2001 Appeal (civil)  1693     of  2001 Appeal (civil)  1694     of  2001

PETITIONER: DR. A. K. DOSHI

       Vs.

RESPONDENT: UNION OF INDIA

DATE OF JUDGMENT:       02/03/2001

BENCH: D.P. Mohapatra & S.N. Variava

JUDGMENT:

S. N. VARIAVA. J.

       Leave granted. L...I...T.......T.......T.......T.......T.......T.......T..J

   These  three  Appeals are directed against the  Judgment dated 20th December, 1999 of the Delhi High Court.  They are being disposed of by this common Judgment.  In this Judgment parties  will  be  referred to in their  capacity  in  Civil Appeal  arising from SLP No.  19580 of 1999.  Briefly stated the facts are as follows:

   In  1997  some  posts of Member, Company Law  Board  had fallen vacant.  A Selection Committee headed by Mr.  Justice S.   C.   Agarwal, a nominee of the Chief Justice of  India, was  constituted to make the selection.  The minutes of  the Selection Committee, dt.  2nd June 1997, read as follows:

   4.  On the basis of the performance of the candidates in the interview and taking into consideration all the relevant factors,  the  Selection  Committee   found  the   following candidates  suitable,  in  order of merit,  and  accordingly recommended  them for appointment as Members of the  Company Law Board :-

   1. Shri S. B. Mathur       - Member (Technical)     2. Shri C. D. Paik         - Member (Judicial)        (ST)

   5.1  The  reserve  panel, to be used for  this  post  of Member,  Technical  in  the  event of  Shri  SB  Mathur  not joining,  shall  be  as  follows in the  order  of  priority indicated below :-

1. Dr. A. K. Doshi 2. Shri R. Vasudevan

5.2 These candidates, if appointed, will rank junior to Shri C. D. Paik.

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6.    The Selection Committee did not find any candidate suitable for the post of Member (Judicial) (SC).

   Thus  the  Selection  Committee  had  selected  the  2nd Respondent.  The reserve panel consisted of the names of the Appellant  and  Shri R.  Vasudevan.  As per  this  selection only  the  name of the 2nd Respondent and Shri C.  D.   Paik could  be  sent to the Appointments Committee.  It  was  not denied  that  in  normal course the  Appointments  Committee would  act on the recommendations of the Selection Committee and  these  two persons would have been appointed.  Shri  C. D.   Paik has been appointed as Member (Judicial).  In these Appeals  the dispute relates only in respect of  appointment to the post of Member (Technical).

   On  10th October 1997 the Secretary to the  Appointments Committee,  whilst forwarding the name of the 2nd Respondent to  the  Appointments Committee, gave the following note  on the relevant file:

"In view of the chequered background of Shri S. B. Mathur, he does not seem to be a fit person of character and unblemished record, for occupying the position of Member, Company Law Board."

   We  were  informed that the Appointments  Committee  was also  informed by the Secretary that a penalty of  reduction of pay by one step in the pay-scale for a period of one year with  restoration  to original stage on the expiry  of  that period  had  been imposed on the 2nd Respondent and that  he had  got  published  a brief analysis on the report  of  the Working  Group on Companies Act through one Bharat Law House Private   Limited,  New  Delhi   and  thereafter   requested permission  to  accept  Rs.10,000/- as honorarium  from  the Publisher.   For  this act he had been issued a warning  for not  obtaining  the prior approval and had been directed  to credit  to  the  Government  that entire  amount.   The  2nd Respondent   had  complied  with   those  directions.    The Appointments  Committee  was also informed that against  the 2nd   Respondent  there  was  a  complaint   pertaining   to publication  of an advertisement for shifting of the  Office of  Regional Director, Kanpur to Ghaziabad or NOIDA on which Rs.   1000/-  was  spent.   On a query from  Court  we  were informed  that the first allegation had been brought to  the notice  of  the  Selection  Committee   but  the  other  two allegations  had  not  been  brought to the  notice  of  the Selection  Committee  even though they related to  a  period prior to the date when the Selection Committee met to select suitable candidates for the post.  We were informed that the other  two allegations were not brought to the notice of the Selection  Committee  as in those cases only a  warning  had been  issued and no entry had been made in the  confidential records.   One  wonders  how such material could  have  been placed  before the Appointments Committee when admittedly it was  not  considered serious enough to be placed before  the Selection Committee.

   By  placing  on  file the above mentioned  comments  and materials,  which  had not been placed before the  Selection Committee,  the  Secretary  of  the  Appointments  Committee effectively   ensures  that  the   2nd  respondent  was  not appointed.   On  the facts on record it is clear to us  that

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the  name of 2nd respondent was rejected by the Appointments Committee,  on 4th December, 1997 because of the unwarranted interference  by  the  Secretary.  By its  Order  dated  4th December, 1997 the Appointments Committee also directed that a  fresh  proposal  for appointment  of  Member  (Technical) Company Law Board be submitted.

   The  reserve  panel  was  to  be used  in  even  of  2nd respondent  not  joining.   As  the  Appointments  Committee rejected  the  name of the 2nd Respondent steps should  have been  taken to place the names of the candidates included in the  reserved  panel  before   the  Appointments  Committee. However,  on  4th  December, 1997, a charge sheet  had  been issued  against the Appellant for a major penalty under Rule 14  of the C.C.S.  (C.C.A.) Rules, 1965.  This was an  event which  took  place  subsequent  to   the  selection  by  the Selection  Committee.   This  event necessarily  had  to  be brought  to  the notice of the Appointments Committee.   Had this  been  brought  to  the   notice  of  the  Appointments Committee,  there  could be no doubt that  the  Appointments Committee would have rejected the name of the Appellant.  No further  names were forwarded to the Appointments  Committee and  no  step to initiate fresh proposal for appointment  to the posts was initiated.  In the meantime the 2nd Respondent had  also  made  a representation against rejection  of  his name.   That  representation should have been placed  before the  Appointments  Committee.   The representation  was  not placed  before the Appointments Committee.  Nothing was done till  May  1998  when the Appellant got  exonerated  by  the Disciplinary  Authority.  Thereafter almost immediately  the representation  of the 2nd Respondent along with the name of the  Appellant was sent to the Appointments Committee.  Even at  this stage the following noting dated 14th May, 1988 was made by the Secretary of the Appointments Committee:

   "23  Regarding Shri Mathur, it may be stated that the ACC  had  considered him not fit for appointment  as  Member (Technical)  in  view of the chequered background and  other considerations  in December, 1997.  The note that led to the said  decision  is on pp.  7-13/N (L.F.  No.  18 (35)  EO/97 (ACC).   In addition, it has come to light that he had  been warned  twice  for some improprieties committed by  him,  as discussed  in  paras  17.2.   and   17.3.   above.   It  is, therefore,  felt that even on reconsideration Shri  Mathur’s claim  for  the post does not merit acceptance.  As  regards Dr.   Doshi,  after  his having been exonerated of  all  the charges  against him, it appears that his appointment can be approved.   ACC  may like to approve the appointment of  Dr. A.   K.  Doshi as Member (Technical), Company Law Board till the  date  of his superannuation on attaining the age of  60 years."

   Thus  even  at  that  stage it was made  sure  that  the Appointments  Committee  did not consider and/or accept  the name  of  the 2nd Respondent but considers the name  of  the Appellant.   It  is  under   these  circumstances  that  the Appellant  came  to  be  appointed  as  Member  (Technical), Company Law Board.

   The  appointment of the Appellant was challenged by  the 2nd  Respondent before the Central Administrative  Tribunal. The  Central  Administrative Tribunal by an Order dated  3rd February,  1999  quashed the appointment of  the  Appellant. The  Appellant challenged the Order dated 3rd February, 1999 in  a  Writ Petition before the High Court at  Delhi.   This

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Writ  Petition came to be dismissed by the impugned Judgment dated 20th December, 1999.

   Civil  Appeal  arising out of SLP No.  19580 of 1999  is filed  by the Appellant.  The Appellant is aggrieved by  his appointment  being  set aside by the Central  Administrative Tribunal  and  the  confirmation of that Order by  the  High Court.   Civil Appeal arising out of SLP(C) No CC 4869  of 2000  is filed by the 2nd Respondent.  2nd Respondent  seeks to  challenge that portion of the High Court Judgment  where it  is held that he had not challenged his rejection by  the Appointments Committee.  Civil Appeal arising out of SLP No. 6435  of 2000 is by the 1st Respondent.  The 1st  Respondent is aggrieved by the strictures passed against them for their conduct  in showing favouritism and the fact that they  have been  directed  to  initiate process of selection  of  fresh candidates by the Selection Committee.

   On behalf of the Appellant Mr.  Goburdhan submitted that the  2nd Respondent had no locus standi to file the Petition before   the  Central  Administrative   Tribunal.   It   was submitted  that  the  Appointments   Committee  had  already rejected  the name of the 2nd Respondent and that  rejection had  not been challenged by him.  It was submitted that once the  2nd Respondent had not challenged his rejection, he had no  locus  standi  to  challenge   the  appointment  of  the Appellant.  On behalf of the 2nd Respondent it was submitted that  he had challenged both the selection of the  Appellant as well the rejection of his name.

   In  our  view, on the facts of this case the  contention raised  on  behalf of the Appellant that the 2nd  respondent could  not  challenge the Appellant’s appointment  since  he (2nd  respondent)  had not challenged the rejection  of  his name by the Appointment Committee, cannot be accepted.  Even assuming  that the 2nd Respondent could have challenged  the rejection  of his name by the Appointment Committee he would have  a cause of action to challenge the appointment of  the Appellant who was undisputedly placed below him in the panel drawn up by the Selection Committee.

   The  next  submission was that once the name of the  2nd Respondent  was  rejected then the  Appellant  automatically became  entitled  to be appointed as his name was second  in the Select List.  In support of this submission reliance was placed  on the case of A.  P.  Aggarwal vs Govt.  of NCT  of Delhi  and  Another, reported in 2000 (1) S.C.C.  Pg.   600. In  this case the Appellant (therein) and another  candidate were  the  only two included in the panel prepared  for  the post  of  Member, Sales Tax Appellate Tribunal.   The  other candidate  joined  but  left soon  thereafter.   Instead  of appointing  the  Appellant the Government initiated  process for  fresh selection.  This was challenged by the  Appellant and his challenge was upheld by this Court.  It must however be noted that, in that case the selected candidate had left. The  Appellant’s contention was also upheld on basis of a OM dt.   14th May 1975, issued by the Central Government  which provided  that  vacancy could be filled in from the  reserve panel.   Further  this  Court  directed  the  Government  to appoint  that  Appellant as there was nothing  against  him. Based  on this case it was submitted that the 1st Respondent was bound to appoint the Appellant (herein) once the name of the 2nd Respondent had been rejected.

   We  are unable to accept this argument.  The  Government

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of  India  has  framed Company  Law  Board  (Qualifications, Experience  and  Other  Conditions of  Service  of  Members) Rules,  1993  (hereinafter  called the said  Rules).   These Rules  were  notified on 28th April, 1993.  Rule 4  provides for  the method of recruitment of Members.  It provides that the  selection of Members shall be made by the Government of India in consultation with the Chief Justice of India or his nominee.   Thus the appointment can only be in  consultation with  the Chief Justice of India or his nominee.  It is  for that  reason that a Selection Committee headed by a  nominee of  the  Chief  Justice  of India  is  constituted  for  the purposes  of  selecting a Member.  All materials, which  are relevant,  are to be placed before the Selection  Committee. It  is the Selection Committee which makes the selection  on the  basis  of  relevant  materials.   After  the  Selection Committee  completes the exercise and recommends one or more names  for  appointment  the recommendation along  with  the materials  considered  by the Selection Committee should  be placed before the Appointments Committee without any further addition  or  alteration.   If in an  exceptional  case  the Appointments Committee feels that certain material which was not  available  to be considered by the Selection  Committee has come into existence in the meantime, and the material is relevant  for  the purpose of appointment, then, the  matter should  be placed before the Appointments Committee with the additional  material for its consideration.  Such a  course, in  our  view, will be in accordance with the scheme of  the Rules and the purpose of making appointment to the important public  office.   We  are constrained to  observe  that  the notings  made by the Secretary of the Appointments Committee in  the file, as noted earlier, was an attempt to  interfere with the process of selection, which was neither permissible under  the  Rules nor desirable otherwise.  By indulging  in such  unhealthy process the sanctity of the selection by the Selection Committee was attempted to be set at naught.  Such conduct  on the part of a senior and experienced  Government officer  does  not commend us.  It must be ensured  that  in future  such  a practice is not repeated.  In this case  the facts  indicate  that, even though the  Selection  Committee made a recommendation, the appointment of that candidate was got rejected/stalled.  Thereafter even though directed to do so by the Appointments Committee, process of fresh selection was  not initiated.  The file was kept pending till name  of the  Appellant could be sent to the Appointments  Committee. The  facts  lead to the only conclusion that there was  rank favouritism  and  a  blatant attempt to  get  the  Appellant appointed  as  Member  (Technical), Company Law  Board.   On these facts the ratio in Aggarwal’s case has no application. Also  in  the  present case there is  no  office  memorandum requiring selection from the reserve panel.

   In view of the facts set out herein above, we are of the opinion  that the Central Administrative Tribunal as well as the  High Court were right in setting aside the  appointment of  the  Appellant.  The Appellant had been unduly  favoured and  the  candidate selected by the Selection Committee  and placed on the merit list had been deprived of appointment.

   It  was  also submitted that the Central  Administrative Tribunal  had  no jurisdiction to entertain the Petition  of the 2nd Respondent.  It was submitted that the Appellant had already  become  a Member of the Company Law Board.  It  was submitted  that  by  virtue  of Section 14  of  the  Central Administrative    Tribunal   Act,     1985,   the    Central Administrative  Tribunal  could only exercise  jurisdiction,

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powers  and authority in respect of an All India Service  or to  any Civil service of the Union or a Civil post under the Union  or to a post connected with defence or in the defence services,  being  a  post  filled by  a  civilian.   It  was submitted  that the post of a Member (Technical) Company Law Board  was neither an All India Service nor a Civil  Service of the Union nor a Civil post under the Union.  Reliance was placed  upon  the authority in the case of Canara  Bank  v/s Nuclear  Power Corporation of India Ltd.  and Ors.  reported in  1995  Supp.  (3) S.C.C.  Pg.  81.  In this case  it  was held  that the Company Law Board was a Court.  Based on this authority  it was submitted that since the Company Law Board is  a  Court, its Members could not be holding  civil  posts under  the  Union.  It was submitted that both  the  Central Administrative  Tribunal and the High Court erred in holding that  the  post of a Member, Company Law Board was  a  civil post.

   Both  the  Central Administrative Tribunal and the  High Court have relied upon various Rules, notably Rules 6, 7, 10 and  13  of  the said Rules and concluded that  these  Rules indicated  control  by the Government.  It was held that  as the  Government had control, thus the post was a civil post. It  must be mentioned that we have reservation in  accepting this  view.   However for all these years the post has  lain vacant.   Even if we were to hold in favour of the Appellant no useful purpose would be served.  The 2nd Respondent would have  to  be given time to challenge in a proper forum.   On facts  set out hereinabove the end result would be the same. The selection of the Appellant would be set aside.  The post would  then lie vacant for the period it takes to dispose of that  matter.   The  only sufferer would be  the  litigating public.  As in this case the facts are very gross, we see no reason  to  interfere.   We leave this question open  to  be decided in an appropriate matter.

   We  have held that the appointment of the Appellant  was correctly  set  aside his civil Appeal should be  dismissed. However,  as the post of the Member (Technical), Company Law Board  has remained vacant for a long time, it is absolutely necessary  that  this post be filled up as expeditiously  as possible.   In  our view it is not at all necessary to  send the  matter  to  another Selection Committee  for  selecting afresh.   In our view interest of justice would be served if the  three  names selected by the Selection Committee  along with  the  materials placed before it are placed before  the Appointments  Committee without any nothings or comments  by anybody.  Only the Report of the Selection Committee and the materials  placed  before  it  must  be  placed  before  the Appointments   Committee   for   its   consideration.    The Appointments  Committee  must now select from amongst  these names.

   With these directions all the Civil Appeals are disposed of.  There will be no Order as to costs.