Failure to table rules in the Legislative Assembly does not invalidate them if the statute specifies no consequences for non-compliance: Supreme Court

The Appellant (S.P. Chandrakar) and Respondent No. 5 (Kishor Bagh) are employees of the District Central Cooperative Bank Ltd (DCCBL), Raipur, governed by the Rules of 1982.

Chandrakar, originally a technical employee (Assistant Engineer), was promoted to the administrative post of Additional Manager on 30.12.2010.

This promotion followed a 2010 circular by the Additional Registrar deleting Rule 5(3)(a), which previously barred technical staff from non-technical posts.

Respondent No. 5 challenged the promotion, arguing the Registrar lacked authority to amend statutory rules via executive circular and that the rules were never tabled before the Legislative Assembly as required by Section 95(3) of the Act, 1960.

The High Court upheld the challenge, setting aside the promotion after thirteen years.

1. Whether the Registrar of Cooperative Societies possesses the power to amend or delete the Service Rules under Section 55(1) of the Chhattisgarh Cooperative Societies Act, 1960.

2. Whether the requirement to "lay" rules before the Legislative Assembly under Section 95(3) of the Act is mandatory or directory.

3. Whether an amendment communicated via an executive circular/instruction is valid if the power to frame such rules is statutorily vested in the issuing authority.

Section 55(1) of the Chhattisgarh Cooperative Societies Act, 1960, which empowers the Registrar to frame rules governing terms of employment.

Section 21 of the General Clauses Act, 1897, establishing that the power to "frame" rules inherently includes the power to add, amend, vary, or rescind them.

The principles in Atlas Cycle Industries Ltd. v. State of Haryana and K.T. Plantation (P) Ltd. v. State of Karnataka, which distinguish between mandatory and directory "shall" based on the presence or absence of consequences for non-compliance.

The doctrine from Hukumchand Mills Ltd. v. State of M.P., stating that a wrong reference to power or nomenclature does not vitiate an action if a valid statutory power exists to support it.

The Court reasoned that Section 55(1) provides the Registrar with plenary power to determine service conditions; thus, the deletion of Rule 5(3)(a) was within his jurisdiction, regardless of whether the communication was labeled as a "circular".

The Court rejected the High Court’s finding that the Additional Registrar acted without authority, noting the circular explicitly stated it was "Ordered by Registrar".

Addressing Section 95(3), the Court held that since the statute prescribes no penalty or consequence for failing to table the rules before the Assembly, the provision is directory, not mandatory.

Consequently, the lack of tabling did not invalidate the amendment.

The Court observed that a promotion undisturbed for thirteen years should not be lightly set aside, especially when founded on a valid exercise of statutory power.

The Court held that the Registrar had the requisite power to delete the restrictive rule and that the notification was valid despite the procedural omission of legislative tabling.

The Court ordered that the Appellant be restored to his position and status with protected seniority, all consequential promotion benefits, and 50% back wages payable within two months, failing which 6% interest per annum shall apply.