Government company posts are not civil posts under Section 14(1) of the Administrative Tribunals Act.

Respondent No. 1, previously an Executive Director at Petitioner No. 1 (NBCC), was appointed as the Managing Director (MD) of Petitioner No. 2 (HSCC)—a subsidiary of NBCC—for a five-year tenure.

The appointment was made by the Ministry of Housing and Urban Affairs (Respondent No. 2) following approval from the Competent Authority.

In late 2025, following allegations of procedural lapses and a Board of Directors (BoD) resolution, Respondent No. 1’s powers were seized, he was repatriated to NBCC, and his services as MD of HSCC were terminated.

Respondent No. 1 challenged these actions before the Central Administrative Tribunal (CAT). The Petitioners raised a preliminary objection, arguing CAT lacked jurisdiction because HSCC is an incorporated company and no notification under Section 14(2) of the Administrative Tribunals Act, 1985, existed to bring its employees under CAT’s jurisdiction.

CAT overruled this objection (IO-1) and stayed the termination (IO-2).

The Petitioners approached the High Court via Article 226 to quash the CAT orders.

Section 14 of the Administrative Tribunals Act, 1985, which distinguishes between jurisdiction over civil services of the Union [Sec 14(1)] and jurisdiction over corporations/societies owned by the Government, which requires a specific Central Government notification [Sec 14(2)].

Supreme Court precedent in Dr. S.L. Agarwal v. Hindustan Steel Ltd., which established that employees of incorporated government companies do not hold "civil posts" under the Union as contemplated by Articles 310 and 311 of the Constitution.

Principle from Balwant Rai Saluja v. Air India Ltd., affirming that a subsidiary company remains a distinct legal entity from its holding company despite shareholding control.

Companies Act, 2013 regarding the independent juristic identity of body corporates.

The court reasoned that for CAT to exercise jurisdiction under Section 14(1), the applicant must hold a "civil post" under the Union.

Petitioner No. 2 (HSCC) is an independent incorporated company with its own service rules (HSCC Rules, 1985) and funds.

The court found that although the Hon’ble President of India made the appointment, she acted in her corporate capacity as the "President of the company" under the Articles of Association (AoA), not as the constitutional head of the Union.

Consequently, the relationship was one of corporate master-servant, and the post was a tenured corporate position, not a civil post.

Regarding Section 14(2), the court held that since no notification was issued specifically for HSCC, the Tribunal could not assume jurisdiction by "inference" simply because the parent company (NBCC) was notified.

The court distinguished State of Gujarat v. Raman Lal Keshav Lal, noting it dealt with inter-posting in government services, which is inapplicable to corporate entities.

Therefore, the CAT’s assumption of jurisdiction was fundamentally flawed as it lacked the statutory prerequisite of a Section 14(2) notification.

It held that Respondent No. 1 did not hold a "civil post" under the Union and that the Original Application was not maintainable before the Tribunal for want of jurisdiction in the absence of a Section 14(2) notification for HSCC.

The court declared the CAT's interim stay order (IO-2) void ab initio as it was passed without jurisdiction.

All pending applications were closed.