Full Judgment Text
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PETITIONER:
GENERAL OFFICER COMMANDING-IN-CHIEF & ANR.
Vs.
RESPONDENT:
SUBHASH CHANDRA YADAV & ANR.
DATE OF JUDGMENT25/02/1988
BENCH:
DUTT, M.M. (J)
BENCH:
DUTT, M.M. (J)
MISRA RANGNATH
CITATION:
1988 AIR 876 1988 SCR (3) 62
1988 SCC (2) 351 JT 1988 (1) 458
1988 SCALE (1)414
ACT:
Cantonments Act, 1924: Section 280(2)(c)-Rule making
power-Cantonment Funds Servants Rules 1937, Rule 5C-Held
void being in excess of rule making power.
Cantonment Funds Servants Rules 1937: Rule 5C-Services
of employees of Cantonment Boards-Transfer of-From one post
in one Board to another post in another Board-Whether valid-
Rule SC held void-Excess of rule making power under section
280(2)(c) of Cantonments Act, 1924.
HEADNOTE:
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The first respondent was appointed a Sub-Charge,
Cantonment General Hospital, Lucknow by the Cantonment Board
by an appointment letter dated 23.4.1969, and was confirmed
in that post on 1.12.1969. The conditions of service of the
employees of the Cantonment Board, a statutory board, were
governed by the provisions of the Cantonment Funds Servants
Rules, 1937. At the time of appointment, the services of the
respondent were not transferable as per the provisions of
the Rules as then prevailing. His appointment letter also
did not include any condition for transfer from one Board to
another.
By a notification dated 16.12.1972, the Rules were
amended and a new rule, being rule 5-C was added to provide
for the transfer of the services of the employees of the
Cantonment Boards from one post in one Board to another post
in another Board within the same State.
The G.O.C.-in-Chief, Central Command by his order dated
October 27, 1986 transferred the first respondent from the
Cantonment General Hospital, Lucknow, to the Cantonment
General Hospital, Varanasi, and the incumbent at Varanasi in
turn being transferred to the Cantonment General Hospital,
Bareilly.
Being aggrieved by the order of transfer passed under
rule 5-C of the Rules, the first respondent filed a writ
petition in the High Court challenging the validity of the
order of transfer on the ground that rule 5-C was ultra
vires the provisions of the Cantonments Act and as such,
void.
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The High Court struck down rule 5-C as being ultra
vires the provisions of the Cantonments Act, 1924 and held
that the services of the employees of the Cantonment Board
are neither centralised nor is there a common State level
service and that rule 5-C having provided for the transfer
of the employees of one Board to another Board by the GOC-
in-Chief, Central Command is beyond the rule making power of
the Central Government as contained in clause (c) of sub-
section (2) of section 280 of the Cantonments Act as it
stood before it was amended. It accordingly quashed the
order of transfer dated October 27, 1988 passed by the GOC-
in-Chief, Central Command.
In the appeal to this Court it was contended on behalf
of the appellants: (1) that after the amendment of clause
(c) of sub-section (2) of Section 280 of the Cantonments Act
conferring on the Central Government the power to lay down
the conditions of service of the employees of the Boards,
which include the power to make rules for transfer, rule 5-C
is valid being in conformity with the provisions of the rule
making power under section 7.80(2)(c) of the Act, and (2)
that the respondent would not be in the least prejudiced by
the transfer inasmuch as full safeguard has been provided
for in rule 5-C.
On behalf of the respondent it was contended that: (1)
service under the Cantonment Board is not a centralised
service or a service at the State level, and (2) the
transfer of an employee from one Cantonment Board to another
would mean the termination of the appointment of the
employees in the Cantonment Board from which he is
transferred and a fresh appointment in the Board where he is
so transferred.
Dismissing the Appeal,
^
HELD: 1. The High Court was justified in striking down
rule 5-C of the Rules and in quashing the order of transfer
of the respondent. [172G]
2. Rules framed under the provisions of a statute form
part of the statute. Rules have statutory force. But before
a rule can have the effect of a statutory provision two
conditions must be fulfilled, namely, (1) it must conform to
the provisions of the statute under which it is framed; and
(2) it must also come within the scope and purview of the
rule making power of the authority framing the rule. If
either of these two conditions is not fulfilled the rule so
framed would be void. [69F-G]
3. When Rule 5-C was inserted in the Rules, it was void
as being
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contrary to and in excess of the rule making power of the
Central Government as contained in the unamended clause (c)
of sub-section (2) of Section 280 of the Act. It does not
become valid merely because of the amendment of clause (c),
conferring power on the Central Government to frame rules
relating to conditions of service.[69C]
4. The position remains the same even though sub-
section (2) of Section 281 of the Act has specifically
provided that after the rules are framed and published they
shall have effect as if enacted in the Act. In spite of the
provision of sub-section (2) of Section 281, any rule framed
under the Cantonments Act has to fulfil the aforementioned
two conditions regarding their validity. [69G-H]
Jestamani v. Scindia Steam Navigation Company, [1961] 2
SCR 811, distinguished.
5. The Cantonment Board are statutory and autonomous
bodies controlled entirely by the Cantonments Act. Each
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Cantonment Board is an independent body functioning within
its limited jurisdiction. The Board is the appointing
authority of its employees. The services under the
Cantonment Board is not a centralised service nor is it a
service at the State level. [70C]
6. One autonomous body cannot transfer its employee to
another autonomous body even within the same State, unless
the services of the employees of these two bodies are under
a centralised or State-level service. [70E-F]
In the instant case, the GOC-in-Chief, Central Command
is not the appointing authority of the respondent or the
employees of the Cantonment Board, and so transfer of the
respondent by the GOC-in-Chief is not permissible. [70E]
Om Prakash Rana v. Swarup Singh Tomar, [1986] 3 SCC
118, referred to.
7. Even in spite of substituted clause (c) of sub-
section (2) of Section 280 the Central Government will not
be entitled to frame rules for transfer of an employee from
one Cantonment Board to another within the State for the
reasons: (t) the Cantonment Boards are autonomous bodies;
(2) the service under the Cantonment Board is neither a
centralised service nor is it a service at the State-level
and (3) any such transfer of an employee will mean
termination of service of the
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employee in the Cantonment Board from where he is
transferred and a fresh appointment by the Cantonment Board
which he joins on such transfer. [72B-C]
8. The Central Government, however, has power to frame
rules about transfer of servants of the Board in exercise of
its powers under clause (c) of subsection (2) of Section 280
of the Act within the region in respect of which it has
jurisdiction. For example, the respondent in the instant
case, could be transferred from one hospital of the
Cantonment Board, Lucknow, to another hospital under the
same Board. [72E-F]
9. The Central Government had better consider the
question of making the Cantonment Board Service a
centralised service so 85 to enable one Cantonment Board to
transfer its employees to another Cantonment Board. [72D],,
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 754 of
1988.
From the Judgment and order dated 31.8.1987 of the
Allahabad High Court in W.P. No. 7899 of 1986
Raja Ram Aggarwal, V.K. Pandita, E.C. Aggarwala and
Atul Sharma for the Appellants.
S.C. Misra and P.K. Chakraborty for the Respondents.
Manoj Swarup and Ms. Lalita Kohli for the Interveners.
The Judgment of the Court was delivered by
DUTT, J. As elaborate submissions have been made by
both the parties at the preliminary hearing of the special
leave petition, we proceed to dispose of the points involved
in the case on merits after granting special leave.
The appeal is directed against the judgment of the
Allahabad High Court striking down rule 5-C of the
Cantonment Funds Servants Rules, 1937, hereinafter referred
to as ’the Rules’, as ultra vires the provisions of the
Cantonment A rt, 1924 and also quashing the impugned order
of transfer dated October 27, 1986 passed by the GOC-in-
Chief, Central Command.
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The respondent, Dr. Subhas Chandra Yadav, was appointed
a Sub-Charge, Cantonment General Hospital, Lucknow, by the
Cantonment Board by the appointment letter dated 23.4.1969.
He was confirmed in that post on 1.12.1969 by an order
issued by the Cantonment Board. The conditions of service of
the employees of the Cantonment Board, which is a statutory
body, are governed by the provisions of the Rules. At the
time of the appointment of the respondent, his services were
not transferable as per the provisions of the Rules then
prevailing. His appointment letter also did not include any
condition for transfer from one Board to another.
By a notification dated 16.12.1972, the Rules were
amended and a new rule, being rule 5-C was added to the
Rules. Rule S-C reads as follows:
"R.5-C. (1) The service of a servant shall be
transferable from one post in one Board to another
post in another Board.
Provided that:
(a) The transferor and transferee Boards are
situated within the same State; and
(b) The posts in both the Boards are similar
and carry the same scales of pay.
(2) Subject to such general directions as the
Central Government may issue from time to time,
the officer Commanding-in-Chief, the Command, or
such other authority as may be authorised by the
Central Government in this behalf, shall be the
competent authority to transfer a servant under
this rule.
(3) A servant on transfer under sub-rule (I)
from one Board to another may, for the purpose of
determination of seniority and eligibility for
promotion opt:
(i) to be governed by the conditions
applicable in this behalf to the servants of
the Board from which he has been transferred
(hereinafter referred to as the transferor
Board); or
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(ii) to be governed by the conditions
applicable in this behalf to the servants of
the Board to which he has been transferred
(hereinafter referred to as the transferee
Board):
Provided that where a servant does not opt
under this rule within thirty days from the date
of assumption of charge in the transferee Board,
he shall, for purposes of promotion and seniority,
be governed by the conditions application in this
behalf to the servants of the transferor Board .
(4) Save as provided in sub-rule (3), the
terms and conditions of service of a servant
transferred under this rule shall be deemed to be
these applicable to the servants of the transferee
Board.
(5) Where the servant opts under clause (ii)
of subrule (3), the service put in by him under
the transferor Board before his transfer shall be
deemed to be service under the transferee Board."
For the first time, rule 5-C provided for the transfer
of the services of the employees of the Cantonment Boards
from one post in one Board to another post in another Board
within the same State. The GOC-in-Chief, Central Command, by
his order dated October 27, 1986 transferred the respondent
from the Cantonment General Hospital, Lucknow, to the
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Cantonment General Hospital, Varanasi, in place of one Dr.
Bansal, who was also transferred by the same order to the
Cantonment General Hospital, Bareilly.
Being aggrieved by the said order of transfer passed
under rule 5-C of the Rules, the respondent filed a writ
petition in the Allahabad High Court challenging the
validity of the order of transfer on the ground that rule 5-
C was ultra vires the provisions of the Cantonment Act and,
as such, void.
As has been stated already, the High Court has struck
down rule 5-C holding, inter alia, that the services of the
employees of the Cantonment Board are neither centralised
nor is there a common State-level service and that the
impugned rule 5-C, having provided for the transfer of the
employees of one Board to another Board by the GOC-in-Chief,
Central Command, is beyond the rule making power
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of the Central Government as contained in clause (c) of sub-
section (2) of section 280 of the Cantonment Act as it stood
before it was amended. Hence this appeal.
Section 280 of the Cantonment Act confers power on the
Central Government to make rules. The relevant portion of
section 280 of the Cantonment Act is as follows:
"S. 280. POWER To MAKE RULES: The Central
Government may after previous publication, make
rules to carry out the purposes and objects of
this Act.
(2) In particular, and without prejudice to
the generality of the foregoing power, such rules
may provide for all or any of the following
matters, namely:
(a).........................................
(b)..........................................
(bb)........................................
(c) the tenure of office, salaries and
allowances, provident funds, pensions,
gratuities, leave of absence and other
conditions of service of servants of Boards;"
Clause (c) of sub-section (2) of section 280 was
substituted by the amendment of the Cantonment Act by Act XV
of 1983. Before such amendment in 1983, clause (c) was as
follows:
"(c). the appointment, control supervision,
suspension, removal, dismissal and punishment of
servants of Boards;"
It is apparent that before the amendment, clause (c)
did not confer on the Central Government power to frame
rules regarding conditions of service which necessarily
include transfer of the employees of the Boards. Rule 5-C,
which was inserted in the Rules by a notification dated
November 23, 1972 providing for the transfer of the
employees of the Cantonment Boards, is on the face of it
contrary to the rule making power of the Central Government,
as it stood before the amendment of the Act in 1983.
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It is, however, contended by Mr. Raja Ram Aggarwal,
learned Counsel appearing on behalf of the appellants, that
after the amendment of clause (c) of sub-section (2) of
section 280 of the Cantonment Act, conferring on the Central
Government the power to lay down the conditions of service
of the employees of the Boards, which include the power to
make rules for transfer, rule 5-C is valid, being quite in
conformity with the provisions of the rule making power
under section 280(2)(c) of the Cantonment Act. We are unable
to accept the contention.
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When rule 5-C was inserted into the Rules, it was void
as being contrary to and in excess of the rule making power
of the Central Government as contained in the unamended
clause (c) of sub-section (2) of section 280 of the
Cantonment Act. It does not become valid merely because of
the amendment of clause (c), inter alia, conferring power on
the Central Government to frame rules relating to conditions
of service.
Our attention has been drawn to the provision of sub-
section (2) of section 281 of the Cantonment Act, which
provides that all rules made under the Act shall be
published in the official Gazette and in such other manner,
if any, as the Central Government may direct and, on such
publication, shall have effect as if enacted in the Act. It
is urged on behalf of the appellants that in view of sub-
section (2) of section 281, rule 5-C became a part of the
statute and, accordingly, the question of its being contrary
to the provisions of the Cantonment Act does not at all
arise.
This contention is unsound. It is well settled that
rules framed under the provisions of a statute form part of
the statute. In other words, rules have statutory force. But
before a rule can have the effect of a statutory provision,
two conditions must be fulfilled, namely, (1) it must
conform to the provisions of the statute under which it is
framed; and (2) it must also come within the scope and
purview of the rule making power of the authority framing
the rule. If either of these two conditions is not
fulfilled, the rule so framed would be void. The position
remains the same even though sub-section (2) of section 281
of the Act has specifically provided that after the rules
are framed and published they shall have effect as if
enacted in the Act. In other words, in spite of the
provision of sub-section (2) of section 281, any rule framed
under the Cantonment Act has to fulfil the two conditions
mentioned above for their validity. The observation of this
Court in Jestamani v. Scindia Steam Navigation Company,
[1961] 2 SCR 811,
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relied upon by Mr. Aggarwal, that a contract of service may
be transferred by a statutory provision, does not at all
help the appellants. There can be no doubt that a contract
of service may be transferred by statutory provisions, but
before a rule framed under a statute is regarded a statutory
provision or a part of the statute, it must fulfil the above
two conditions. Rule 5-C was framed by the Central
Government in excess of its rule making power as contained
in clause (c) of sub-section (2) of section 280 of the
Cantonment Act before its amendment by the substitution of
clause (c); it is, therefore, void.
It is not disputed that the Cantonment Boards are
statutory and autonomous bodies controlled entirely by the
Cantonment Act. Each Cantonment Board is an independent body
functioning within its limited jurisdiction. The Board is
the appointing authority of its employees. The service under
the Cantonment Board is not a centralised service nor is it
a service at the State-level.
There is much force in the contention of the respondent
that as service under the Cantonment Board is not a
centralised service or a service at the State-level, the
transfer of an employee from one Cantonment Board to another
would mean the termination of appointment of the employee in
the Cantonment Board from which he is transferred and a
fresh appointment in the Board where he is so transferred.
The GOC-in-Chief, Central Command, is not the appointing
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authority of the respondent or the employees of the
Cantonment Board, and so transfer of the respondent by the
GOC-in-Chief is not permissible. In any event, one
autonomous body cannot transfer its employee to another
autonomous body even within the same State, unless the
services of the employees of these two bodies are under a
centralised or a State-level service. In this connection, we
may refer to a decision of this Court in Om Prakash Rana v.
Swarup Singh Tomar, [1986] 3 SCC 118. Pathak, J. (as His
Lordship then was) speaking for the Court observed as
follows:
"As is clear by now, the fundamental basis of the
contention that the power of transfer under the
Education Act and its Regulations continues in
force even after the enactment of the Services
Commission Act rests on the assumption that the
power of appointment does not include the power of
transfer. In our opinion, the assumption is
unsustainable. The scheme under the Education Act
envisages the appointment of a Principal in
relation to a specific college. The appointment is
in relation to that college and to
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no other Moreover, different colleges may be owned
by different bodies or organisations, so that each
Principal serves a different employer. Therefore,
on filling the office of a Principal to a college,
a new contract of employment with a particular
employer comes into existence. There is no State-
level service to which Principals are appointed.
Had that been so, it would have been possible to
say that when a Principal is transferred from one
college to another no fresh appointment is
involved. But when a Principal is appointed in
respect of a particular college and is thereafter
transferred as a Principal of another college it
can hardly be doubted that a new appointment comes
into existence. Although the process of transfer
may be governed by considerations and move through
a machinery different from the considerations
governing the appointment of a person ab initio as
Principal, the nature of the transaction is the
same, namely, that of appointment, and that is so
whether the appointment be through direct
recruitment, through promotion from the teaching
staff of the same institution or by transfer from
another institution."
The observation extracted above clearly supports ’the
contention made on behalf of the respondent that the
employees of one Cantonment Board cannot be transferred to
another Cantonment Board inasmuch as the service under the
Cantonment Board is not a centralised service or a service
at the State-level.
Mr. Aggarwal, however, submits that the respondent
would not be in the least prejudiced by the transfer in as
much as full safeguard has been provided for in rule 5-C.
The question whether the interest of the transferee has been
protected or full safeguard has been provided for by rule
5-C is quite irrelevant, if it is invalid and void.
Moreover, the provisions of rule 5-C are clumsy and lack
clarity and a transfer may affect the transferee
prejudicially. It is not necessary for us to discuss how the
provisions of rule 5-C may be prejudicial to the interest of
an employee transferred to another Cantonment Board within
the State, for, we are of the view that rule 5-C is ultra
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vires the provision of the rule making power of the Central
Government under the Cantonment Act.
The question, however, is whether the Central
Government is entitled to frame rules for transfer of the
employees of the Cantonment Boards under the substituted
clause (c) of sub-section (2) of
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section 280 of the Cantonment Act. It is true that under
clause (c), as it now stands, the Central Government can
frame rules pertaining to conditions of service of the
Cantonment Board employees. But, in our opinion, even in
spite of substituted clause (c), the Central Government will
not be entitled to frame rules for transfer of an employee
from one Cantonment Board to another within the State for
the reasons stated already, namely, (1) the Cantonment
Boards are autonomous bodies; (2) the service under the
Cantonment Board is neither a centralised service nor is it
a service at the State level; and (3) any such transfer of
an employee will mean termination of service of the employee
in the Cantonment Board from where he is transferred and a
fresh appointment by the Cantonment Board which he joins on
such transfer.
So long as the Cantonment Board service is not made a
centralised service or at least a State-level service, there
can be no transfer from one Cantonment Board to another
Cantonment Board within the same State. The Central
Government has better consider the question of making the
Cantonment Board service a centralised service so as to
enable one Cantonment Board to transfer its employees to
another Cantonment Board.
As has been held by the High Court, the Central
Government has power to frame rules about the transfer of
the servants of the Board in exercise of its powers under
clause (c) of sub-section (2) of section 280 of the Act
within the region in respect of which it has jurisdiction.
For example, the respondent could be transferred from one
hospital of the Cantonment Board, Lucknow, to another
hospital under the same Board. But that apart, the
Cantonment Act does not authorise the Central Government to
frame rules for transfer from one Cantonment Board to
another.
The High Court was, therefore, quite justified in
striking down rule 5-C of the Rules and in quashing the
impugned order of transfer of the respondent.
For the reasons aforesaid, the judgment of the High
Court is affirmed and this Appeal is dismissed. There will,
however, be no order as to costs.
N.V.K. Appeal dismissed.
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