REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO…7116/2010

(arising out of SLP© No…24537/2010 ..@….CC 18056/2009 )

Union of India & Anr. …….Appellants

Vs.

Bhaskarendu Datta Majumdar       …….Respondent

J U D G M E N T

HARJIT SINGH BEDI,J.

1. Delay condoned.

2. Leave granted.

3. This appeal by way of special leave has been filed by the  

Union  of  India  and  the  State  Trading  Corporation  

impugning  the  judgment  of  the  Division  Bench  of  the  

High Court  of  Delhi  dated 18th May 2009 whereby the  

judgment of the Single Judge dated 9th January 2009 has  

been set aside and a direction has been issued that the  

case  of  the  respondent  for  appointment  as  Director  

Marketing  in  the  State  Trading  Corporation  be  re-

considered in the  

manner indicated therein.  The facts of the case are as  

under:

4. The respondent Bhaskarendu Datta Majumdar joined the  

services  of  the  State  Trading  Corporation  (hereinafter  

called “Corporation”) in April 2001 as Executive Secretary  

to  the  Chairman-cum-Managing  Director  of  the  

Corporation  and  was  on  the  relevant  date  working  as  

Chief General Manager.  A post of Director (Marketing)  

having fallen vacant, the respondent applied for the post  

on the 27th December 2005.  Interviews were held on 4th  

March 2006 by the  Public  Enterprises Selection Board  

(PESB for short) and two candidates were shortlisted, the  

respondent being at serial No.1, and one Neeraj Mishra at  

serial  No.2  in  order  of  preference.   Consequent  to  the  

selection, the Central Vigilance Commissioner also issued  

a clearance for the respondent on or around 26th March  

2006,  and  it  is  the  case  of  the  respondent  that  the  

Department of Commerce, being the Ministry concerned,  

forwarded his name to the Appointments Committee of  

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the Cabinet (ACC  

for short) for final approval.  Further, it is the case of the  

respondent  that  his  name  has  been  endorsed  by  the  

Home Minister as the second Member of the ACC, but the  

incumbent Cabinet Secretary who had earlier been the  

Managing  Director  of  the  Corporation,  scuttled  his  

appointment  taking  note  of  some  serious  allegations  

which at one point of time had been levelled against him.  

It  appears  that  in  1994-95  the  respondent  had  been  

dragged  into  various  departmental  enquiries  and  two  

criminal  investigations  by  the  Central  Bureau  of  

Investigation at the instance of the said officer,  but he  

was exonerated of any misdoing and the adverse entries  

of  doubtful  integrity  were  thereby  deleted  from  his  

confidential  roll.   As  a  consequence  of  what  had  

happened,  Neeraj  Misra  who  was  at  serial  No.2  was  

proposed for appointment but finally even his name too  

was dropped and a direction was issued by the ACC to  

undertake a fresh process for filling up the vacancy.  The  

respondent thereupon filed a Writ Petition in the Delhi  

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High Court which  

was dismissed by the learned Single Judge holding that it  

was the exclusive jurisdiction of the ACC to assess the  

suitability  of  a  candidate  and  the  court  could  not  

interfere  in  this  discretion  except  in  a  case  of  proven  

mala fides.  The Letters Patent Appeal that followed has  

been allowed and that judgment is now challenged before  

us.  The primary reason that weighed with the Division  

Bench  was  that  the  ACC  had  given  no  reasons  

whatsoever,  not  even  on  the  file,  as  to  why  the  

recommendation of the PESB was being ignored.

5.    Mr. Malhotra, the learned Additional Solicitor General  

for the appellant Union of India, has submitted that as  

the ACC was the  final  authority  to make the selection  

and  appointment,  it  alone  had  the  jurisdiction  to  

determine  the  suitability  of  an  officer  and  a  decision  

taken by the committee was not open to challenge except  

on grounds of mala fide or for other exceptional reasons.  

He has pointed out that there was no plausible reason for  

the Division Bench to have interfered, more particularly  

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as  there  was  no  

rule which required that reasons be recorded by the ACC  

while differing with the opinion of the PESB.  Reliance for  

this assertion has been placed on Union of India & Anr.  

vs.  Samar Singh  & Ors.  1996 (10)  SCC 555, Chief  

Executive Officer vs. Biswa Bhusan Nandi 2008 (10)  

SCC 161 and Union of India and Ors. vs. Ram Kumar  

Thakur 2009(1) SCC 122.    

6. Before the Division Bench, the primary issue raised on  

behalf of the respondent herein was that his name had  

been  recommended  by  all  the  authorities  and  two  

members of the ACC but in the final analysis the ACC  

had not accepted the recommendation and it was thus  

incumbent on the ACC to offer reasons for differing with  

the  proposal  made  by  the  PESB and  though  the  said  

reasons were  not  required to  be  communicated  to  the  

officer concerned, it was nonetheless open to the Court to  

examine the record to see if any reason had indeed been  

recorded.   Reliance was also placed on the decision of  

this  Court  in  Union  of  India  and  Ors.  vs.  

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N.P.Dhamania  &  

Ors. 1995 Suppl. (1) SCC 1 in which it has been held  

that though the ACC was the appointing authority and  

therefore  entitled  to  differ  with  the  recommendation  of  

the PESB, it was necessary to give reasons for doing so to  

obviate any chance of arbitrariness and for that purpose  

the Court could look into the record to satisfy itself.   

7. We  have  considered  the  arguments  advanced  by  the  

learned  counsel  for  the  parties.   We  find  that  the  

judgment in Samar Singh’s case (supra) is inapplicable.  

In  this  matter  the  name  of  the  officer  had  not  been  

included in the panel prepared by the Special Committee  

with the result that his case was not considered by the  

ACC.  A perusal of the judgment would reveal that the  

primary  issue  raised  before  the  court  was  as  to  the  

exclusion of the officer from the panel prepared by the  

Standing Committee.  We find that the other judgments  

cited by the learned ASG are not relevant to the present  

matter and do not merit any discussion whatsoever.  On  

the  contrary,   N.P.Dhamania  case  (supra)  is  almost  

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identical not only  

on facts but even on the legal issues raised.   It has been  

held as under:  

“19. Notwithstanding the fact that it is open  to  AAC  which  alone  is  the  appointing  authority and not the Minister concerned, as  urged  by  the  respondent  to  differ  from the  recommendations  of  the  DPC,  it  must  give  reasons for so differing to ward off any attack  of arbitrariness. Those reasons will have to be  recorded in the file. It requires to be stated at  this stage that we have perused the file in the  instant case.  We find no reasons have been  recorded  for  differing  from  the  recommendations of the DPC. That is why the  tribunal  also  inter  alia  observes  in  the  impugned judgment as under:

However, the counsel for the respondent felt  helpless in the matter and he failed to provide  us any inkling of what prevailed with the ACC  in dropping the petitioner and four others out  of the select panel of 59 officers.

20.  If  the  file  had  contained  reasons  something  could  be  said  in  favour  of  the  appellant.  But,  that  is  not  the  case  here.  Then  the  question  would  be  whether  the  reasons  recorded  are  required  to  be  communicated to the officer concerned. Our  answer is in the negative.  There is no need to  communicate  those  reasons.  When  challenged it is always open to the authority  concerned to produce the necessary records  before the Court.

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22.  ACC  may  reconsider  these  cases  within  3  months  in  the  light  of  the  observations  at  page 7,10 and above and if  found suitable,  may give promotion with effect from the date,  their immediate junior officer was promoted  with consequential  benefits  of  seniority  and  salary etc.”

8. These observations apply fully to the facts of this case.  

The Division  Bench had also  noticed,  (and it  has not  been  

denied by the Union of India) that after the various enquiries  

and  investigations  had  been completed  and the  respondent  

exonerated on merits he had obtained two promotions, first as  

General  Manager  and  thereafter  as  Chief  General  Manager,  

and the entry with regard to his doubtful integrity which had  

been made on account of the pending matters, had also been  

removed.   The  Division  Bench  had  also  called  for  the  

confidential  record  of  the  respondent  and observed  that  he  

had been assessed as “very good” for the years 2001-02 and  

2002-03, “Excellent” for the year 2003-04 and “Outstanding”  

for the years 2004-05 and 2005-06.  It  goes without saying  

that these were the crucial years in so far as the respondent’s  

case for promotion to Director (Marketing) was concerned.  The  

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Division  Bench  also  

observed, that though requested, the counsel for the Union of  

India  had not  been able  to  show any  record indicating  the  

reasons as to why the ACC had differed with the opinion of the  

PESB,  leading  to  the  only  inference  that  no  reasons  

whatsoever  had  been  recorded.   We  are,  therefore,  of  the  

opinion that there is no merit in this appeal.  It is accordingly  

dismissed with no order as to costs.

      ……………………….…J.     (HARJIT SINGH BEDI)

      ………………….J.           (J.M.PANCHAL)

New Delhi, August 27, 2010

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