Hemant Kumar Sharma vs Uoi & Ors.
2012 Latest Caselaw 874 Del

       *       IN THE HIGH COURT OF DELHI AT NEW DELHI

                                         Date of decision: 8th February, 2012

+                                   W.P.(C) 1347/2011

%          HEMANT KUMAR SHARMA                 .....Petitioner
                      Through: Mr. V. Shekhar, Sr. Adv. with Mr.
                               Abhigya & Ms. Deepakshi Jain,
                               Advs.

                                      Versus
           UOI & ORS.                                       ..... Respondents
                             Through:     Mr. Jatan Singh, CGSC.

CORAM:-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
                                    JUDGMENT

RAJIV SAHAI ENDLAW, J.

1. The petition impugns: i) the order dated 25.02.2011 of the respondent

UOI relieving the petitioner "of his duties and post with immediate effect"

as Chairman-cum-Managing Director (CMD) of M/s Satluj Jal Vidyut

Nigam Ltd. (SJVNL); ii) the Office Memorandum dated 31.12.2010 of the

respondent No.3 Central Vigilance Commission (CVC) recommending

initiation of minor penalty proceedings against the petitioner. As a

consequence to the said two reliefs, the petition seeks extension of services

of the petitioner as CMD of SJVNL upto 31.07.2014, as recommended by

the Public Enterprises Selection Board (PESB), without getting influenced

by the recommendations / advice aforesaid of the CVC. The writ petition

was accompanied with an application for interim relief seeking inter alia

continuation of the petitioner as CMD of SJVNL.

2. Notice of the petition was issued on 28.02.2011 but the only interim

relief granted was of making further arrangements with respect to the post

of CMD subject to further orders of the Court. LPA No.222/2011 was

preferred by the petitioner against the order of non grant of the interim relief

sought but without any success. Pleadings have been completed and the

counsels have been heard. Written submissions have also been filed by the

petitioner.

3. The petitioner was vide order dated 18.07.2005 of the Ministry of

Power, Government of India, acting on behalf of the President of India, and

in pursuance of Article 32 of the Articles of Association of the SJVNL,

appointed to the post of CMD of SJVNL with effect from the forenoon of

18.07.2005 for a period of five years or till the date of his superannuation or

until further orders whichever event occurs the earliest. The said term of

five years was going to end on 17.07.2010. Since the tenure of the CMD

could be extended upto the date of superannuation and which the petitioner

was/is to attain on 31st July, 2014, the Ministry of Power, Government of

India on 02.06.2010 referred the proposal for extension of tenure of the

petitioner as CMD, SJVNL to PESB for a period upto 30.06.2014. The

PESB recommended extension of tenure beyond 17.07.2010 till 30.06.2014.

However since the proposal further required vigilance clearance from the

CVC before seeking approval of the Appointments Committee of the

Cabinet (ACC) and which process was likely to take some time, vide order

dated 15.07.2010, the petitioner was permitted to continue to hold the

charge of the post of CMD for a period of three months beyond 17.07.2010

pending consideration of the proposal for extension till 31.07.2014. Vide

another order dated 15.10.2010, further ad-hoc extension of three months

beyond 17.10.2010 i.e. till 17.01.2011 was given to the petitioner pending

consideration of the proposal for extension till 31.07.2014.

4. According to the petitioner, at this stage, with the intent of denying

extension to the petitioner an old case was raked up. However, according to

the respondent the said case was brewing since before. It is undisputed that

two complaints dated 20.09.2007 and 24.09.2007 had been received in the

Ministry alleging irregularities in award of tender by SJVNL and on which

factual report / comments of Central Vigilance Officer (CVO), SJVNL were

called for on 28.09.2007. The CVO, SJVNL submitted interim report dated

26.11.2007 and final report dated 31.03.2008 to the effect that of the six

allegations, three were found genuine. One of the allegations was of laying

down of minimum qualifications in the tender in a manner to make only a

single party eligible therefor. The Ministry of Power on 22.07.2008 sought

the comments of the petitioner on the said report. In the meanwhile, on

20.10.2008, CVO, SJVNL forwarded its report directly to CVC. The

Ministry after receiving the comments from the petitioner called for further

comments which were submitted on 12.05.2009. The CVC on the basis of

the report received by it from the CVO, SJVNL directed identification of the

names of the officers of SJVNL who had so restricted competition.

However, since the names of the Board Level Officers were not indicated,

CVO, SJVNL was asked to name the Board Level Officers responsible.

The CVO, SJVNL vide his letter dated 16.09.2009 indicated the names of

two Directors and the petitioner as CMD as the Board Level Officers

responsible. Comments were thereafter called from the petitioner and the

CVC, on 31.12.2010 after examining the case advised initiation of minor

penalty proceedings against the petitioner and Director, Finance of SJVNL.

The CVC accordingly denied vigilance clearance for extension of the tenure

of the petitioner as CMD. Accordingly, the petitioner was vide order dated

25.02.2011 impugned in this petition relieved from his duties.

5. At this stage, it may also be mentioned that upon the respondent No.1

scheduling interviews for appointment to the post of CMD, another

application seeking stay thereof was filed which was dismissed vide order

dated 02.08.2011.

6. The contention of the senior counsel for the petitioner is, that the

advice of the CVC for initiation of minor penalty proceedings against him is

not binding; that vigilance clearance has been wrongly withheld; that the

petitioner is being victimized to deny him his legitimate right of extension

of tenure till 31.07.2014; that the representations of the petitioner have

remained unheeded; that no inquiry for minor penalty proceedings also was

initiated against him; that the ACC was not apprised of the facts; that a

Board Level appointee has a vested right of extension till the age of

superannuation; that the petitioner has an impeccable record of service and

has earned laurels and also transformed SJVNL and made it attain the status

of „Mini Ratna Category-1‟. The senior counsel for the petitioner has

further argued that on the basis of a prima facie opinion of guilt inviting

minor penalty, extension could not have been denied. Reliance is placed on:

(i) Dr. Jose Paul Vs. UOI 77 (1999) DLT 653 (DB) on the scope

of the powers under Article 226 of judicial review in the matter

of appointment.

(ii) A.K. Kapur, VSM (Major General) Vs. UOI 157 (2009) DLT

527 (DB) where ACC was directed to re-examine the matter for

the reason of no results having been reported for 16 months on

the case against the petitioner therein.

(iii) A.K. Kapur, VSM (Major General) v. UOI 163 (2009) DLT

606 (DB)

(iv) UOI Vs. Bhaskarendu Datta Majumdar IX (2010) SLT 102

where direction for reconsidering the case was issued finding

no reason for rejecting the recommendations of the Selection

Board.

7. The senior counsel for the petitioner has argued that the ACC in the

present case was not given the unadulterated information. He has also

invited attention to the copy of the Cabinet Secretary‟s DO No.

27(18)/EO/86-ACC dated 12.12.1986 providing for approval of the ACC

before termination of appointment i.e. refusing extension. On the basis

thereof, it is contended that the Rule is of first considering extension

depending upon the past performance and only if the past performance is

found dismal is the fresh recruitment to be resorted to. He has further

argued that since it is the case of the respondent UOI that the matter

regarding irregularities aforesaid in tender was under consideration since

2008, the very fact that notwithstanding the same, the Ministry of Power as

well as the PESB recommended extension for the petitioner and in fact

granted extension albeit for three months only is indicative of the said

irregularity not coming in the way of extension. He has also invited

attention to the proposal dated 16.12.2010 of the Ministry of Power for

grant of extension for one year to the petitioner. Though the said proposal

did not fructify, on the basis thereof, it is contended that the same is also

indicative of the alleged irregularity being not a reason for not granting

extension to the petitioner. Attention is also invited to the Office

Memorandum No.104/33/2005-AVD.I dated 29.10.2007 of the Department

of Personnel and Training qua guidelines regarding grant of vigilance

clearance to All India Services officers. On the basis thereof, it is contended

that vigilance clearance is not to be withheld unless the officer is under

suspension or is on the Agreed List or a chargesheet has been issued against

him in a disciplinary proceedings and the proceeding is pending or unless

orders for instituting disciplinary proceedings have been issued and the

chargesheet is served within three months of such an order or unless the

chargesheet has been filed in a Court by the investigating agency or when

orders for instituting a criminal case against the officer have been issued or

when sanction for investigation or prosecution has been granted or when an

FIR has been filed and lastly when the officer is involved in a trap / raid

case on charges of corruption and investigation is pending. It is thus

contended that vigilance clearance cannot be withheld on the grounds of

minor penalty being under contemplation. Mr. K.K. Rai, Senior Advocate

who appeared for the petitioner on one of the dates of hearing, with

reference to the order dated 04.02.2011 in W.P.(C) No.638/2011 earlier

filed by the petitioner has also contended that the issue of minor penalty

even if under contemplation ought to have been decided before taking

decision on termination of the petitioner. He also contended that all that the

petitioner was claiming in the present petition was for the unadulterated

facts to be placed before the ACC.

8. Mr. Jatan Singh learned counsel for the UOI has contended that the

appointment of the petitioner was a tenure appointment and the petitioner

had no vested right of extension. Reliance in this regard is placed on

Shankar Raju Vs. UOI I (2011) SLT 168. He has further contended that

the Ministry of Power was bound by the advice of the CVC irrespective of

departmental action and once the CVC had refused clearance to the

petitioner, the question of his being entitled to extension does not arise.

Reliance is placed on Centre for PIL Vs. UOI (2011) 4 SCC 1 where

principle of institutional integrity was laid down. He has further argued that

even if the petitioner is good and has performed well as the CMD, that alone

does not confer a right in him to extension if not above board. Mr. Jatan

Singh learned counsel for the UOI in his list of judgments also included

Nagar Mahapalika Kanpur Vs. Vibha Shukla (2007) 15 SCC 161 and Reji

Kumar Vs. Director of Health Services, Kerala (2009) 16 SCC 385 qua

fixed term appointments.

9. The counsel for CVC has invited attention to paras 24 to 26 of Y.N.P.

Sinha Vs. UOI 95 (2002) DLT 186 laying down that even after a person is

recommended by the PESB before his name is forwarded to the ACC, it is

mandatory to obtain clearance from vigilance angle and for which clearance,

scrutiny of his antecedents is to be done; that the words "scrutiny of

antecedents" are of wide sweep and consideration would not be confined

only in respect of cases wherein departmental proceedings or criminal

proceedings are pending but would include those cases where allegations

against such person are pending investigation; that any material can be

relevant in this regard.

10. The senior counsel for the petitioner in rejoinder has referred to the

SJVNL Conduct, Discipline and Appeal Rules to show the minor penalties

and the procedure to be dealt therewith. Attention has also been invited to

the dictionary meaning of the word "extension". Reference is further made

to Dr. A.K. Doshi Vs. UOI (2001) 4 SCC 43 on the requirement to place all

material before the ACC.

11. What strikes one as peculiar from the aforesaid narrative based on

records is that the case of the petitioner is not of any person in authority

being inimical to him or being interested in denying extension to him. The

pleadings are bereft of any names. The Supreme Court recently in THDC

India Ltd Vs. Voith Hydro Gmbh Co. (2011) 4 SCC 756 also held that

allegations of malafide and bias directed against an organization as a whole

without naming any individual person cannot be accepted. The sole case of

the petitioner was of an old matter being raked up at the time of

consideration of his extension. However, the facts as aforesaid speak

otherwise. The matter was certainly brewing since 2007-08, that is long

prior to the consideration of extension of the petitioner. It is also not in

dispute that the CVC clearance was a must and was denied. The only

question which thus remains for consideration is, whether any case for

interference with the said denial of CVC clearance can be made out.

12. The CVC is a high level body and in the absence of any allegations of

malpractices or bias therein, this Court cannot sit in appeal over its decision

denying clearance to the proposal for extension of the petitioner. The

proposal for extension mooted by the Ministry of Power, in the absence of

any finding of guilt of the petitioner and the recommendation of the PESB

which is concerned with the past performance of the petitioner do not confer

any benefit on the petitioner. The questions of integrity and whether the

performance of the petitioner was honest were within the domain of CVC.

The CVC on a consideration thereof has found the petitioner wanting and

not entitled to such clearance for the reason of irregularities in the tender

aforesaid. It thus cannot be said that the decision of the CVC is without any

reason or basis. The arguments of the petitioner that the penalty is minor or

that no proceedings with respect thereto have been taken are irrelevant in

this regard. The CVC, as held by this Court in of Y.N.P. Sinha (supra) is to

"scrutinize the antecedents" and which words are of a wide sweep. The

CVC before making its recommendations, though not to act arbitrarily, at

the same time is not to comply with the principles of natural justice or

render any finding as to the guilt of the petitioner. It was held that the

opinion so formed by the CVC is not dependent upon whether chargesheet

has been issued or is under contemplation or any criminal proceedings are

pending or sanctioned. Once CVC on the basis of the material, which

admittedly exists in the present case has come to the conclusion that

clearance is to be denied, that is a reasonable exercise of power.

13. The Division Bench of this Court in Waris Rashid Kidwai v. Union

of India (1998) III AD (Delhi) 113 held that in respect of Board level

appointments, CVC acts as a watchdog and the person to be appointed to

such a post has to be above board and ought to have impeccable integrity. It

was further held that the recommendations of the PESB are of no avail in as

much as PESB is not concerned with the vigilance angle. Similarly this

Court in A.K. Chawla v. UOI (1996) V AD (Delhi) 604 held that mere

failure on the part of the authorities to complete the appraisal before the

expiry of the term itself would not entitle the incumbent to extension or to

continue. I also find that a Division Bench of the Jharkhand High Court in

Deobart Sahay v. UOI MANU/JH/0971/2003 in near similar facts held that

extension in such cases is not a matter of right and no case of legitimate

expectation also is made out.

14. As far as the argument of the senior counsel for the petitioner of

unadulterated material having not been placed before the ACC is concerned,

the same is without any basis. There is nothing to show that all the material

was not placed before the ACC. Moreover, it is always open to the ACC, if

desirous of, to seek further clarification. However, it is apparent that the

ACC was satisfied with the rejection of vigilance clearance by the CVC.

The petitioner on the basis of the said plea is merely seeking a second

chance and which cannot be allowed.

15. No merit is thus found in the petition. The same is dismissed. No

order as to costs.

RAJIV SAHAI ENDLAW, J FEBRUARY 8, 2012 „gsr‟