Full Judgment Text
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PETITIONER:
B.S. MINHAS
Vs.
RESPONDENT:
INDIAN STATISTICAL INSTITUTE & ORS.
DATE OF JUDGMENT19/10/1983
BENCH:
MISRA, R.B. (J)
BENCH:
MISRA, R.B. (J)
BHAGWATI, P.N.
CITATION:
1984 AIR 363 1984 SCR (1) 395
1983 SCC (4) 582 1983 SCALE (2)574
CITATOR INFO :
R 1986 SC1571 (57)
RF 1991 SC1173 (5)
ACT:
Constitution of India. Articles 12 and 32.
Indian Statistical Institute-A society registered under
the Societies Registration Act-Financed and controlled by
Central Government-Whether ’other authority’ within meaning
of Article 12-Whether amenable to writ jurisdiction under
Article 32.
Civil Service
Indian Statistical Institute-Director-Vacancy of-Bye
law No. 2 of Institute require vacancy to be publicised
before recruitment-Whether obligatory for Institute to
follow the bye-law-No minutes of selection committee
maintained or circulated amongst members-Selection whether
valid.
Indian Statistical Institute Act 1959 Ss 4, 5, 6, 7, 9
and 12.
Indian Statistical Institute-Institute of National
Importance-Whether ’other authority’ within the meaning of
Article 12 of the Constitution.
HEADNOTE:
The Indian Statistical Institute was registered under
the Societies Registration Act, and governed by the Indian
Statistical Institute Act, 1959. Its control completely
vested in the Union of India, respondent no. 5 in the
appeal. The Institute had been declared as an ’Institute of
National Importance.
The chief executive body of the Institute was the
Council, respondent no. 2 which consisted of 25 members of
whom three were representatives of the Central Government.
The Council was headed by a chairman who was elected. In
order to discharge the administrative and academic
responsibility of the Institute a Director was appointed by
the Council. Respondent no. 4 was appointed as a Director.
The petitioner in his Writ Petition challenged the
appointment of respondent no. 4 on the ground that he was a
person] of much higher academic and other accomplishments
and far superior to the said respondent.
396
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In the Writ Petition it was contended: (i) Bye-law 2
expressly requires that the vacancy of Directorship should
be suitably publicised but in the present case no publicity
whatsoever was given to the vacancy of Directorship.
Publicity was necessary if the appointment was to be fair
and free from partiality and that many were not aware of the
vacancy of the post of Director till the actual order of
appointment was made. (ii) He was eminently suitable for
being appointed to the post in view of the various
contributions in the field of his work and the active part
played by him in resolving the administrative problems of
the Institute, and (iii) no bio-data or information was
placed before the Council which under the bye-laws was the
appointing authority to enable the members to gauge the
comparative suitability of various candidates.
The petition was resisted on behalf of respondent Nos.
1 and 2 by contending: (i) the petition is not maintainable
under Article 32 of the Constitution as respondents Nos. 1
and 2 are not ’state’ or ’other authority’ within the
meaning of Art. 12 of the Constitution. (ii) Even assuming
that there has been a violation of bye-law 2 no writ can lie
to correct the same as the alleged bye-law has no statutory
basis inasmuch as the Institute has been declared as an
Institution of National Importance’, the bye-laws not being
statutory the respondents are under no obligation to observe
the procedure Laid down therein, and (iii) the petitioner
was duly and properly considered for selection to the post.
Allowing the writ petition,
^
HELD: (i) The order of appointment dated August 3, 1979
of Respondent No. 4 as the Director of Respondent No. 1 is
quashed and set aside. Before Respondent No. 1 proceeds to
select a new Director, it will comply will the requirement
of bye-law 2 by giving suitable publicity to the vacancy in
the office or Director. [413 F]
(ii) There can be no doubt that respondent No. 2 is an
’authority’ within the meaning of Article 12 of the
Constitution and, therefore, the writ petition filed by the
petitioner is competent and maintainable. [409 G]
In the instant case, the money required for funding the
Institute is provided entirely by the Central Government and
even if any other moneys are to be received by the Institute
it can be done only with the approval of the Central
Government, and the accounts of the Institute have also to
be submitted to the Central Government for its scrutiny and
satisfaction. The Society has to comply with all directions
as may be issued by the Central Government. The control of
the Central Government is deep and pervasive and, therefore,
it is an instrumentality of the Central Government and as
such is an ’authority’ within the meaning of Article 12 of
the Constitution. It is, therefore, subject to the
constitutional obligations under Articles 14 and 16 of the
Constitution. [408 C-D]
Ajay Hasia etc. v. Khalid Mujib Sehravardi & Ors. etc.
[1981] 2 SCR 79 referred to
397
2. (i) It is obligatory on the part of respondent No. 1
to follow the bye-laws for the bye-laws have been framed for
the conduct of its affairs to avoid arbitrariness. [410 G]
(ii) Compliance with bye-law 2 seems to be necessary in
the name of fair-play. If the vacancy in the post of
Director had been publicised as contemplated by bye-law 2,
all the persons eligible for the post may have applied and
in that case, the field of consideration would have been
enlarged and the selection committee or the Council would
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have had a much larger field from which to choose the best
available reason and that would have removed all doubt of
arbitrariness from the mind of those eligible for the post.
[411 B]
Ramana Dayaram Shetty v. International Airport
Authority of India (1979) 3 SCR 1014; Viteralli v. Seton 3
Law Fd. Second Series 1012; A.S. Ahluwalia v. Punjab [1975]
3 SCR 82; Sukhdev v. Bhagatram [1975] 3 SCR 619 referred to.
(iii) In the case of appointment of a Director, bye-law
2 clearly provides for publicity, the object being that all
concerned may know about the vacancy and either applications
or recommendations may be made for the post and the names of
the eligible candidates may be brought before the selection
committee for its consideration. [412 H-413 A]
(iv) It is not suggested that appointments to every
post must be made only after advertising or publicising the
vacancy. That would not be right, for there are quite a few
posts at the top level as for example Commander of Armed
Forces or the Chief Justice or the Judges of the Supreme
Court or the High Court, which cannot be and should not be
advertised or publicised, because they are posts for which
there should be no lobbying nor should any applications be
allowed to be entertained. [411 C-D]
(v) It is not for the Court to determine who is the
superior of the two candidates and who should be selected.
It is for the authorities concerned to select from amongst
the available candidates. The members of the selection
committee as also the members of the Council were eminent
persons and they may be presumed to have taken into account
all relevant considerations before coming to a conclusion.
But in the absence of publicity as contemplated by bye-law
2, it cannot be said that all other qualified persons like
the petitioner were also considered by the selection
committee for appointment, in the absence of any application
by them for the post or any recommendation of them by any
other authority or individual. [412 C-E]
3. It is always desirable that in public bodies the
minutes of the proceedings regarding selection should be
properly maintained in order to obviate any suspicion or
doubt and such minutes along with the relevant documents
should be placed before the final authority entrusted will
the task of selection for appointment. [412 A]
In the instant case, there is nothing on record to show
that the Council was at any time informed as to what names
had been considered by the selection committee or that the
names of the petitioner had been considered but respondent
No. 4 was found superior. [411 H]
398
JUDGMENT:
ORIGINAL JURISDICTION: Writ Petition No. 1519 of 1979.
(Under article 32 of the Constitution of India )
V.M. Tarkunde, P.H. Parekh and Miss Caprihan for the
Petitioner
R.R. Garg, L.R. Singh and Gopal Singh for Respondents 1
& 2.
D.P. Singh, L.R. Singh and Mr. Gopal Singh for
Respondents 3 & 4.
Harbans Lal and G.S. Narain for Respondent No. 5.
Miss A. Subhashini, C.V. Subba Rao and R.N. Poddar for
the Union of India.
The Judgment of the Court was delivered by
MISRA J.: By the present petition under Article 32 of
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the Constitution the petitioner seeks to challenge the
appointment of Shri B.P. Adhikari, respondent No. 4, as the
Director of the Indian Statistical Institute, respondent No.
1.
The Indian Statistical Institute is a Society
registered under the Societies Registration Act. It is
governed by the Indian Statistical Institute Act, 1959
(hereinafter referred to as ’the Act’). Its control
completely vests in the Union of India, respondent No. 5. It
is wholly financed by the Union of India. All the functions
of the Institute are controlled by the Union of India, as is
evident from the various provisions of the Act. Under s. 8
of the Act the annual work programmes of the Institute and
the general financial estimates in respect of such work are
settled by committees appointed by the Central Government
and the Institute obviously cannot undertake any research or
training programmes without the approval of the Central
Government. The Institute carries on an integrated programme
of training, teaching and research in statistics and
application of statistical techniques in other disciplines.
The Institute has been declared as an ’Institution of
National Importance’ under the Act. Under s. 4 of the Act
the Institute has been empowered to grant such degrees and
diplomas in statistics as may be determined by the Institute
from time to time. In accordance with the provisions of s. 5
of the Act the Central Government pays to the Institute in
each financial year such sums of money as the Government
considers
399
necessary by way of grant. Loan or otherwise to enable the
Institute to discharge efficiently its functions including
research, education, training, project activities and
statistical work relating to planning for national
development. Section. 6 of the Act deals with audit of
accounts of the Institute by auditors duly qualified to act
as auditors of companies under the Companies Act, 1956 and
selected by the Central Government after consultation with
the Comptroller and Auditor-General of India. Section 7 of
the Act restricts the powers of the Institute to alter,
extend or abridge its memorandum or rules and regulations
and to sell or otherwise dispose of its property acquired
with the money specifically provided for such acquisition by
the Central Government except with the previous approval of
the Central Government. Section 9 empowers the Central
Government to constitute a committee, inter alia, for
reviewing and evaluating the work done by the Institute and
the progress made by it as also advising Government
generally on any matter which in the opinion of the Central
Government is of importance in connection with the work of
the Institute. Section 11 of the Act empowers the Central
Government to issue directions to the Institute. Section 12
authorises the Central Government to assume control over the
Institute under certain extreme circumstances.
The Institute receives grants from the Central
Government to meet almost the entire expenditure on its plan
and non-plan activities. The chief executive body of the
Institute is the Council, respondent No. 2, consisting of 25
members including three representatives of the Central
Government. The Council is headed by the Chairman elected to
that position by the Council by a simple majority from
amongst the names proposed by the President or members of
the Council. The election of the Chairman of the Council is
governed by bye-laws of the Institute.
The initial appointment to carry out research and
teaching work is to the post of professor. The next post in
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the hierarchy is of Research professor and the highest in
the hierarchy is the post of Distinguished scientist. In
order to discharge the administrative and academic
responsibilities of the Institute, a Director, with
distinctive administrative and academic acumen, is appointed
by the Council, respondent No. 2. Shri B. P. Adhikari,
respondent No. 4, was appointed as the Director of the
Institute by an order dated 3rd August, 1979. This order of
appointment has been challenged by the petitioner on various
grounds.
400
According to the petitioner he was a Distinguished
Scientist of the Institute at the relevant time. To start
with, he was appointed to the post of Economist in the
Indian Statistical Institute on 1st October, 1962 on a
monthly pay of Rs. 1000/- in the time scale of RS. 750-50-
1250 plus special pay of Rs. 350/- per month. Within a year
he was promoted as Professor in the time scale of Rs. 1000-
50-1500 with a starting pay of Rs 1400/- per month, and from
1st October, 1967 he had been holding the post of Research
Professor in the time scale of Rs. 1600-100-1900. On 1st
January 1968 he was made officer-in-Charge and. entrusted
with all technical matters, administration and developmental
plans relating to planning and regional survey units special
training in Delhi. He was given a allowance of Rs. 200/- per
month over and above the pay in the time scale of Research
Professorship. The petitioner has been responsible during
the period 1962-1974 for the creation and promotion of
several new activities of respondent No. 1 in Delhi.
Specialised training in National Planning and Econometrics
for M. Stat. (2nd Year) trainees of respondent No. 1 was
started in Delhi under the direction of the petitioner. In
August 1974 the petitioner was designated as Head of the
Delhi Centre and was also appointed to the Institute’s
Committee of Administration. On 12th March 1976 he was
elevated to the position of ’Distinguished Scientist’ with
pay of Rs. 3000/- per month plus allowances. The petitioner
has held responsible positions as Visiting Professor,
Fellow, Chairman, Consultant, Research Associate, Lecturer
etc. in various Universities in India and in the United
States of America and England. He has been a member of the
planning Commission, Government of India from January 1971
to December, 1973 and he has also been a member of the Sixth
Finance Commission from July 1972 to October 1973. The
petitioner’s work has been acclaimed in the international as
well as national spheres. His work is rated high as
evidenced by the award of Dadabhai Nauroji Memorial Prize
for Economics in 1974 and the Jawaharlal Nehru Memorial
Fellowship in 1975. In 1976 the petitioner had the
distinction of presiding over the annual conference of the
Indian Society of agricultural Economics. People abroad have
also conferred recognition on the petitioner.
The petitioner’s scientific output has been
substantial. He has been active in research and he has
published books. Of importance on Theory of International
Trade, Scheduling the operations of Multipurpose Reservoirs,
Indian Planning, Planning and the Poor etc. His
contributions in the form of articles in collaboration with
Indian
401
and foreign economists have been published in several
journals in India and abroad. One of his co authors, Prof.
Arrow is a Nobel Laureate. At present the petitioner is
engaged in research on the following subjects:
1. Growth, Poverty and Basic Need, Development Policy
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in Sri Lanka, Kerala and Punjab.
2. Inter-Regional Comparisons of Agricultural Growth
and Development in South Asia in the post-colonial
period.
It is claimed that a comparative evaluation of the
achievements of the petitioner with those of respondent No.
4 clearly shows the superiority of the petitioner over
respondent No. 4. Respondent No. 4 had joined the Institute
as Professor in the pay scale of Rs. 750-1250. He was
appointed in Delhi and was incharge of the evening course in
Introductory Statistics. He served in Delhi for about a year
and then went to Calcutta and continued as professor from
1961 to 1974. In contrast, the petitioner had started at a
higher salary of Rs. 1000 p.m. plus a special pay of Rs 50
p.m. The petitioner had been promoted to the higher rot of
Research Professor on 1st October, 1967 in the time scale of
Rs.1600-100-1900 while respondent No. 4 had been promoted to
the post of Research Professor only in 1974. At that time
respondent No.4’s appointment as Research professor had been
objected to as he had not published any technical paper
since his joining the Institute in 1961. The petitioner was
senior to respondent No 4 as he had been appointed to the
higher post of Research Professor earlier than respondent
No.4. On 12th March 1976 the petitioner was promoted to the
position of a Distinguished Scientist. The petitioner is
senior to respondent No. 4 and all other scientists of the
Institute. The petitioner’s elevation to the position of
Distinguished Scientists came much earlier than that of
respondent No. 4. The petitioner has been holding the
position of Distinguished Scientist since 12th March 1976
while respondent No. 4 was not a Distinguished Scientist
till his impugned appointment as Director. Respondent No.4
has won no laurels in his sphere of work and his scientific
output has been negligible. Thus, from all accounts the
petitioner was more qualified and his achievements in all
spheres were much higher than those of respondent No. 4 or
for the matter of that, than those of any other scientist of
the Institute.
402
The Institute has an academic council consisting of the
following members among others:
"1. All Professors, Research Professors and
Distinguished Scientists.
2. ........
3. ........
4. ........
5. .........
6. ........
7. Director (as Chairman of the academic council)."
The Institute is governed by its memorandum, regulations and
bye Laws in the conduct of its affairs. Bye-law 2 provides
the procedure for the appointment of a Director. It reads:
"The appointment of the Director shall be made by
the Council on the recommendation made by a Selection
Committee consisting of
(i) Chairman of the Council (as Chairman),
(ii) Two experts approved by the Council.
Before recruitment the Vacancy for Directorship should
be suitably Publicised."
In the meeting of the Council, respondent No. 2, on
16th April, 1979, Shri P.N. Haksar, respondent No. 3, the
Chairman, reported about the absence of the Director and
other allied matters and invited the attention of the
members’ to the fact that the Director of the Institute,
Prof. G. Kallianpur is unable to devote full time to the
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Institute. The Council felt that since the Institute
required full time attention it was desirable that Prof.
Kallianpur should be requested to continue in the post of
Director on a whole time basis. The Chairman was authorised
to write to the Director conveying the views of the members
and after getting a response from Prof. KallianPur, to take
further action. In case Prof. Kallianpur resigned,
403
the Chairman was authorised to accept his resignation and
then to set up a committee consisting of the following
members to select a suitable person for the post of
Director:
1. Shri P.N. Haksar, Chairman.
2. Prof. Bhabatosh Datta.
3. Prof. S.S. Shrikhande.
4. Prof. M.S. Narasimhan.
5. Dr. R Ramanna.
Subsequently another meeting of respondent No. 2 was held on
3rd August, 1979 in which the Chairman reported that Prof.
Kallianpur had resigned from the Directorship of the
Institute with effect from 30th June, 1979 and regarding the
appointment of the new Director of the Institute the
Chairman reported that the selection committee, which had
been constituted by the Council in its meeting on 16th of
April, 1979 had unanimously recommended the appointment of
respondent No. 4 as Director of the Institute. The Council
approved the recommendation of the selection committee and
it also approved the terms and conditions of appointment of
respondent No. 4 as Director. One of the terms of
appointment of respondent No. 4 was that he should be in the
substantive position of a ’Distinguished Scientist’ in the
Institute on a monthly salary of Rs. 3000.
When the petitioner came to know about the appointment
of respondent No.4 to the post of Director he felt aggrieved
and met respondent No.3, the Chairman of the Council, Shri
P.N. Haksar and expressed his deep unhappiness at the choice
of the new Director of respondent No.1. On getting no
favourable response from respondent No.3 the petitioner
tried to approach the other members of the Council to
indicate his resentment at the alleged illegality and
arbitrariness in the appointment of respondent No.4. The
petitioner addressed a letter to Shri N. Srinivasan,
Secretary to respondent No.2, wherein he referred to the
circular dated 4th August, 1979 which he had received
intimating him about the appointment of respondent No.4 as
Director of respondent No.1. By this letter the petitioner
pointed out to the Secretary that the appointing authority
had not observed the rules and regulations and bye-laws of
the
404
Institute as laid down in the memorandum of association and
had also violated the provisions of Arts. 14 and 16 of the
Constitution. He also pointed out that the vacancy of the
post of Director had not been publicised and he being the
seniormost researcher working as Distinguished Scientist of
the Institute was not given an opportunity to apply for the
same. He also pointed out the arbitrary manner in which the
appointment of respondent No.4 had been made, and he urged
the Institute to rectify the error failing which he might be
obliged to take legal action. The petitioner likewise
addressed a letter to another member of the Council, Prof.
R.P. Bambah, who was a Professor of Mathematic in the Centre
for advanced Studies, Punjab University and was one of the
two Scientists co-opted by the Council. The petitioner in
his letter to Prof. Bambah complained that with the
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appointment of respondent No. 4 the Directorship and his
simultaneous designation to the post of Distinguished
Scientist, the council had subverted the academic standards
of the Institute and violated the rules and regulations as
contained in the memorandum of association as also the
various provisions of the Constitution. Further, the
appointment was arbitrary inasmuch as it was without any
regard to the claims of senior and better known professional
persons. He appealed to Prof. Bambah to upheld the academic
integrity of the Institute and initiate corrective action to
rectify the wrong and rescue the Institute from
manipulations of unprincipled people. A similar letter was
addressed by the petitioner to Shri S.C. Bhattacharya.
Director, Bose Institute, Calcutta, on 31st August, 1979,
another member of the Governing Council of respondent No.1,
who was one of the four representatives of the Indian
National Science Academy. He also wrote to Prof. P.V.
Sukhatme, Professor of Biometry in Pune, who was also a
distinguished member of the Council. He was awarded the
Padma Bhushan and also held the post of Director of
Statistics Division of Food and Agriculture Organisation. A
Similar letter was addressed by him to Shri Subimal Dutt,
President of respondent No. 1, reiterating the same
grievances. Similar letters dated 30th and 31st August, 1979
were addressed to Dr. K.C. Seal, Director, Central
Statistical Organisation Government of India and to Shri
Kirpa Narain, Secretary, Department of Statistics’
Government of India.
It may be pointed out that the members of the selection
Committee and the members of the Council are all men of
eminence and highly qualified persons.
405
Prof. S.C. Bhattacharya by his letter dated 5th of
September, 1979 replied that the contents of the
petitioner’s letter were disquieting. He also stated that
respondent No.4 had been identified as a suitable person by
a group of eminent people and on the basis of advice
received from them the Council, respondent No.2, had
approved the appointment of respondent No.4. the further.
stated that he was not making any further comments in the
matter at this stage. He was unaware of respondent No.4
having been designated as Distinguished Scientist by the
Council in the meeting of 3rd August, 1979. Regard in
appointment he further said that no report of the selection
committee had been circulated to the members of the Council
but the announcement was made orally by the Chairman. Since
it was difficult to hear every word of the Chairman at the
meeting he had assumed that the terms of appointment would
be those ordinarily prescribed for the post of Director.
Prof Sukhatme in his reply said that he had not
realised the grave issues which such an appointment could
raise. He wanted, however, to assure that there was no
intention on their part to subvert the academic standards of
the Institute. He assured the petitioner that he would be
writing to the Secretary on the Council to know what was the
procedure tor appointing a person to the post of
Distinguished Scientist and whether the same should have
been explained to the Council before adopting the
resolution.
Prof. R.P. Bambah on 22nd September, 1979 wrote a
letter to Shri P.N. Haksar submitting his resignation
presumably in protest against what had happened in regard to
the appointment of respondent No. 4 as the Director of the
Institute. In his letter he stated that he had not received
any official bio-data or information regarding the
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scientific contribution of respondent No. 4 and other
available candidates for the post of Director to enable him
to form his own judgment. He said that he presumed that the
scientific contribution of respondent No. 4 must have been
high enough to warrant his holding the post of Distinguished
Scientist. He also expressed the view that since the
committee consisted of eminent scientific working under his
guidance, he had presumed that all relevant factors had been
taken into consideration regarding the appointment to the
post of Director, including the quality of candidate’s
scientific contribution, in coming to a decision. In the
circumstances he has constrained to resign from the Council
since he had not displayed due diligence in the performance
of his function as member of the Council.
406
The petitioner likewise received a letter from the
Chairman in A which he did not deny the allegation contained
in the petitioner’s letter dated 13th August, 1979 that the
vacancy in the post of Director of respondent No. 1 had not
been publicised.
Another meeting of the Council was held on 19th
October, 1979 and in this meeting Prof. Raja Ramanna, Dr.
S.C. Bhattacharya and Dr. P.V. Sukhatme were not present and
Dr. Bambah had resigned on 22nd September, 1979.
Nonetheless, the proceedings of the meeting of 19th October,
1979 do not allude to Dr. Bambah’s resignation. In this
meeting the letter of the petitioner was considered, copies
of which had been circulated to the members earlier and the
Council decided that no action was necessary in the matter.
Shri V.M. Tarkunde appearing for the petitioner
challenges the appointment of respondent No. 4 on various
grounds:
1. (a) Bye-law 2 expressly requires that the vacancy
of the Directorship should be suitably
publicised but in the present case no
publicity whatsoever was given to the vacancy
of Directorship.
(b) Even apart from the bye-law, publicity was
necessary if the appointment was to be fair
and free from partiality.
(c) The petitioner and many others like him were
not aware of the vacancy of the post of
Director till the actual order of appointment
of respondent No. 4 was made.
2. The petitioner was eminently suitable for being
appointed to the post of Director keeping in view
his various contributions in the field of his work
and the active part played by him in resolving the
administrative problems of the Institute.
3. No bio-data or information was placed before the
Council which under the bye-laws was the
appointing authority of the Director to enable the
members to gauge the comparative suitability of
various candidates for the post of Director. No
facts relating to the other candidates were
presented before the
407
selection committee by the Chairman. As such there
was no application of mind by the members of, the
Council, since no report was circulated regarding
the recommendation of the selection committee, and
the members of the Council took it for granted
that all was well.
Shri R.K. Garg appearing for respondents Nos. 1 and 2
resisted the petition on the following grounds:
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(i) that the petition is not maintainable under
Art. 32 of the Constitution as respondent
Nos. 1 and 2 are not ’state or other
authority’ within the meaning of Art. 12 of
the Constitution.
(ii) (a) Even assuming, though not conceding, that
there has been a violation of bye-law 2 no
writ can lie to correct the same as the
alleged bye-law has no statutory basis
inasmuch as by the Indian Statistical
Institute Act, 1959 Parliament only declared
the Indian Statistical Institute, respondent
No. 1 as an institution of national
importance and if it has made bye-law 2 for
its guidance, such bye-law cannot be said to
have any statutory force.
(b) The bye-laws not being statutory the
respondents are under no obligation to
observe the procedure laid down in the bye-
laws.
(iii) In any case the petitioner was duly and
properly considered for selection to the post
of Director and, therefore, he could not
possibly make any grievance about violation
of bye-law 2.
In view of the contentions raised by the counsel for
the parties the first question that falls to be considered
is whether the writ petition is maintainable.
Article 12 of the Constitution defines ’State’ for the
purposes of Part III of the Constitution. It reads:
408
" 12. In this part, unless the content otherwise
requires, "the state" includes the Government and
Parliament of India and the Government and the
Legislature of each of the States and all local or
other authorities within the territory of India or
under the control of the Government of India."
The learned counsel for the petitioner, Shri Tarkunde
has contended that having regard to the provisions of the
Act and the memorandum of association, the composition of
respondent No. 1 is dominated by the representatives
appointed by the Central Government. The money required for
running the Institute is provided entirely by the Central
Government and even if any other moneys are to be received
by the Institute it can be done only with the approval of
the Central Government, and the accounts of the Institute
have also to be submitted to the Central Government for its
scrutiny and satisfaction. The Society has to comply with
all such directions as may be issued by the Central
Government. The control of the Central Government is deep
and pervasive and, there fore, to all intents and purposes,
it is an instrumentality of the Central Government and as
such is an ’authority’ within the meaning of Art. 12 of the
Constitution. It is, therefore, subject to the
constitutional obligations under Arts. 14 and 16 of the
Constitution. Reliance was placed upon Ajay Hasia etc. v.
Khalid Mujib Sehravardi & Ors. etc. The Constitution Bench
in that case took, the view that the expression ’other
authorities’ in Art. 12 must be given a broad and liberal
interpretation, where constitutional fundamentals vital to
the maintenance of human rights are at stake and functional
realism and not facial cosmetics must be the diagnostic
tool, for constitutional law must seek the substance and not
the form The Court pointed out the Government may act
through the instrumentality or agency of juridical persons
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to carry out its functions, since, with the advent of the
welfare State, its new tasks have increased manifold and
such juridical persons acting as the instrumentality or
agency of the Government must therefore be subject to the
same discipline of fundamental rights as the State.
Proceeding further the Court observed:
"It is undoubtedly true that the corporation is a
distinct juristic entity with a corporate structure of
its own and it carries on its functions on business
principles
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with a certain amount of autonomy whish is necessary as
well as useful from the point of view of effective,
business management, but behind the formal ownership
which is cast in the corporate mould, the reality is
very much the deeply pervasive presence of the
Government. It is really the Government which acts
through the instrumentality or agency of the
corporation and the juristic veil of corporate
personality worn for the purpose of convenience of
management and administration cannot be allowed to
obliterate the true nature-of the reality behind which
is the Government. Now it is obvious that if a
corporation is an instrumentality or agency of the
Government it must be subject to the same limitations
in the field of constitutional law as the Government
itself, though in the eye of the law it would be a
distinct and independent legal entity. If the
government acting through its officers is subject to
certain constitutional limitations, it must follow a
fortiori that the Government acting through the
instrumentality or agency of a corporation should
equally be subject to the same limitations. If such a
corporation were to be free from the basic obligation
to obey the Fundamental Rights, it would lead to
considerable erosion of the efficiency of the
fundamental Rights, for in that event the government
would be enabled to over-ride the Fundamental Rights by
adopting the stratagem of carrying out its functions
though the instrumentality or agency of a corporation,
while retaining control over it."
Having regard to this decision and in view of the facts
and circumstances in the present case there can be no doubt
that respondent No.2 is an ’authority’ within the meaning of
Art. 12 of the Constitution and, therefore, the writ
petition filed by the petitioner is competent and
maintainable and the objection raised by Shri Garg cannot be
accepted.
The next question that aries for consideration is
whether the appointment of respondent No.4 as Director of
respondent No.1 is illegal because of non-compliance with
bye-law 2. Bye-law 2 does require that before appointment,
the vacancy in the post of Director should be suitably
publicised. In the instant case, it is admitted on both
sides that no publicity whatsoever was given in respect of
the
410
vacancy. The contention of Shri Garg, however, is that the
bye-law having no force of statute, non-compliance with its
requirement can not in any way affect the appointment of
respondent No. 4 as Director of respondent No. 1. Shri
Tarkunde, however, contended that assuming that the bye-law
is not statutory, even so respondent No. 1 was bound to
comply with it. In support of his contention he strongly
relied upon Ramana Dayaram Shetty v. International Airport
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Authority of India. The Court in that case held:
"It is a well settled rule of administrative law
that an executive authority must be rigorously held to
the standards by which it professes its actions to be
judged a and it must scrupulously observe those
standards on pain of invalidation of an act in
violation of them. This rule was enunciated by Mr.
Justice Frankfurter in Viteralli v. Seton where the
learned Judge said:
"An executive agency must be rigorously held to
the standards by which it professes its action to be
judged. Accordingly, if dismissal from employment is
based on a defined procedure, even though generous
beyond the requirements that bind such agency, that
procedure must be scrupulously observed. This
judicially evolved rule of administrative law is now
firmly established and, if I may add, rightly so. He
that takes the procedural sword shall perish with the
sword.".
The aforesaid principle laid down by Mr. Justice Frankfurter
in Viteralli v. Seton has been accepted as applicable in
India by this Court in A. S. Ahluwalia v. Punjab and in
subsequent decision given in Sukhdev v. Bhagatram. Mathew J.
quoted the above referred observation of Mr. Justice
Frankfurther with approval.
In view of the pronouncement of this Court on the point
it must be held to be obligatory on the part of respondent
No. 1 to follow the bye-laws, if the bye-laws have been
framed for the conduct of its affairs to avoid
arbitrariness. Respondent No. 1 cannot,
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therefore, escape the liability for not following the
procedure prescribed by bye-law 2.
Compliance with this bye-law also seems to be necessary
in the name of fair-play. If the vacancy in the post of
Director had been publicised as contemplated by bye-law 2,
all the persons eligible for the post may have applied and
in that case, the field of consideration would have been
enlarged and the selection committee or the Council would
have had a much larger field from which to choose the best
available person and that would have removed all doubt, of
arbitrariness from the mind of those eligible for the post.
Of course, we do not wish to suggest for a moment that
appointment to every post must be made only after
advertising or publicising the vacancy. That would not be
right, for there are quite a few posts at the top level
which cannot be and should not be advertised or publicised,
because they are posts for which there should be no lobbying
nor should any applications be allowed to be entertained.
Examples of such posts may be found in the post of Commander
of Armed Forces or the Chief Justice or the Judges of the
Supreme Court or the High Court. But here bye-law 2 requires
that vacancy in the post of Director should be publicised
and hence we are making they above observation in this
paragraph.
The grievance of the petitioner is that he has not been
considered for appointment to the post of Director although
he is far superior to respondent No. 4. If there had been
due publicity as required by bye-law 2, he and many others
like him would have applied for the post. Shri Garg,
however, contends for respondent No. 1 that the petitioner
can have no grievance as his case was duly considered as
stated clearly in the affidavit of respondent No. 3, Shri
P.N. Haksar, Chairman of the Council. We accept the
statement of respondent No. 3 that the case of the
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petitioner was considered by the selection committee but it
is a little unfortunate that there is no written report by
the selection committee for consideration by the Council. No
minutes of the proceedings before the selection committee
have been maintained and none were circulated amongst the
members of the Council along with the agenda of the meeting
nor were any such minutes placed before the Council meeting
when the name of respondent No. 4 was approved by the
Council. There is also nothing on record to show that the
Council was at any time informed as to what names had been
considered by the selection committee or that the name of
the petitioner had been considered but respondent No. 4 was
found superior. It is always desirable that in
412
public bodies the minutes of the proceedings regarding
selection A should be properly maintained in order to
obviate any suspicion or doubt and such minutes along with
the relevant documents should be placed before the final
authority entrusted with the task of selection for
appointment.
A lot of argument has been-advanced by Shri Tarkunde
that the achievements and accomplishments of the petitioner
were much higher than those of respondent No. 4. His
contribution in the matter of research had won him high
praise. He ha written articles and books of great merit. On
the other hand the achievements or accomplishments of
respondent No. 4 were much lower when com pared to those of
the petitioner. Be that as it may, it is not for the Court
to determine who is the superior of the two candidates and
who should be selected. It is for the authorities concerned
to select from amongst the available candidates. The members
of the selection committee as also the members of the
Council were eminent persons and they may be presumed to
have taken into account all t relevant considerations before
coming to a conclusion. But the real difficulty is that in
the absence of publicity as contemplated by bye law 2, it
cannot be said that all other qualified persons like the
petitioner were also considered by the selection committee
for appointment, in the absence of any application by them
for the post or any recommendation of them by any other
authority or individual.
Shri Garg, however, contends that the office of the
Director is a very high office and this honour is conferred
and not demanded and an application for this office from the
candidates was not at all necessary as in the case of Judges
of the Supreme Court, High Court and other constitutional
posts of Comptroller and Auditor General of India etc. The
selection committee composed of eminent scientists of high
reputation must be knowing about the reputed men in the
field of statistics and it is expected that they must have
considered the; case of those persons also.
For reasons we have already indicated, we find no force
in this contention. There is no provision for publicity in
case of the constitutional posts of the Judges of the
Supreme Court and High Courts and Comptroller and Auditor
General of India. Rather in the very nature of things, they
cannot be and are not publicised. But in the case of
appointment of a Director, bye-law 2 clearly provides for
publicity and it can only be with the object that all
concerned may
413
know about the vacancy and either applications or
recommendations may be made for the post and the names of
the eligible candidates my be brought before the selection
committee for its consideration. In the state of the record
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before us it is not possible to say that the members of the
Council considered the case of the petitioner and other
candidates like him before approving the appointment of
respondent No. 4. It is true that the members of the
selection committee and those of the Council were experts in
their respective subjects and were eminent scientists and we
must proceed on the basis that they acted in all fairness
and no oblique motive can be attributed to them. Indeed Shri
Tarkunde did not allege any mala fides against the members
of the selection committee or the members of the Council.
On the admitted position, no publicity in regard to the
vacancy was done at all. No information about it was
published even on the notice board kept in the various
branches of respondent No. 1 at Calcutta and other places.
Nor was the information published in the journal of
respondent No. 1. There was clearly a breach of bye-law 2 in
making appointment of respondent No. 4 and there was no
adequate material before the Council on the basis of which
the members could apply their mind for determining as to
whether they should approve the recommendation of the
selection committee in regard to appointment of respondent
No. 4.
For the foregoing reasons the writ petition must
succeed. It is accordingly allowed. The order of appointment
dated 3rd August, 1979 of respondent No. 4 as the Director
of respondent No. 1 is quashed and set aside. This will
however not in any way affect the validity of any action
already taken by respondent No. 4 as Director nor will it
involve him in any liability to refund any excess
remuneration received by him in his capacity af Director.
Before respondent No. 1 proceeds to select a new Director,
it will comply with the requirement of bye-law 2 by giving
suitable publicity to the vacancy in the office of Director.
In the circumstances of the case the parties will bear their
own costs.
N.V.K. Petition allowed.
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