Ravendra Garg vs Union Of India And Ors
2016 Latest Caselaw 3092 Del

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*      IN THE HIGH COURT OF DELHI AT NEW DELHI

+                        W.P.(C) 2056/2015
                                     Reserved on: 22nd January, 2016
                                    Date of decision: 29th April, 2016

       RAVENDRA GARG                                    ..... Petitioner
                   Through:           Mr. Arnunav Patnaik and Ms.
                                      Bhabna Das, Advocates.
                         Versus

       UNION OF INDIA AND ORS.                      .... Respondent
                     Through: Mr. Jasmeet Singh, CGSC with Mr.
                     Srivats Kaushal, Advocate for UOI.
                     Mr. Naresh Kaushik, Advocate for the UPSC.

       CORAM:
       HON'BLE MR. JUSTICE SANJIV KHANNA
       HON'BLE MR. JUSTICE NAJMI WAZIRI

SANJIV KHANNA, J.:

       Ravendra Garg, the petitioner assails order dated 23rd December,

2014 passed by the Principal Bench, Central Administrative Tribunal, New

Delhi (Tribunal, for short), whereby his OA No.3631/2014 has been

dismissed.

2.     By order dated 4th December, 2009, the petitioner was appointed as

the Director (Finance) in the National Projects Construction Corporation

Limited (NPCC) with effect from 21st July, 2009, for a period of five years

or till the date of superannuation or until further orders, whichever was

WP(C) No.2056/2015                                              Page 1 of 15
 earlier. The said appointment was on the recommendation of the Public

Enterprises Selection Board and with the approval of the Appointments

Committee of Cabinet (ACC).

3.     Consequently, the tenure of the petitioner came to an end on expiry

of five years on or about 20th July, 2014. Earlier, on 22nd February, 2013, a

memorandum under Rule 11 of the NPCC (CCA) (First Amendment)

Rules, 2005, framing articles of charge was issued and served on the

petitioner. On the basis of the report submitted by the Inquiry Officer,

disciplinary authority imposed penalty of „censure‟ vide order dated 8th

May, 2014. An appeal against penalty of „censure‟ was rejected. The

petitioner, it was stated, has filed a separate OA challenging penalty of

„censure‟ and we are not concerned with the merits etc. of the same in the

present writ petition.

4.     The prayer made in the present writ petition is for quashing the order

dated 30th September, 2014 whereby the petitioner was relieved from the

post of Director (Finance). The petitioner also seeks quashing of the letter

dated 30th September, 2014 of the Ministry of Water Resources, River

Development and Ganga Rejuvenation and office memorandum dated 1st

August, 2014 issued by the same Ministry. Direction is sought that the

respondents should apply the benchmarking system to the petitioner as

prescribed in D.O. No.5/6/2010-PESB dated 28th June, 2011 and the

benchmarking chart/table should be placed before the competent authority
WP(C) No.2056/2015                                                Page 2 of 15
 for grant or consideration of extension of tenure as Director (Finance) in

NPCC.

5.     The petitioner contends that there has been procedural illegality and

abject failure on the part of the respondents in not applying the

benchmarking system as mandated by the ACC guidelines dated 31th

March, 2011 and PESB circular dated 28th June, 2011. This stipulation and

prescribed procedure, it is contended, is salutary and stands reiterated in

several office Memoranda and Circulars. This violation, it is urged, is

contrary to the mandate of Articles 14 and 16 of the Constitution. The

benchmarking criteria evolved and recommended by the ACC ensures

objectivity and eliminates arbitrariness. Under the benchmarking system,

points or marks are allocated in the Special Performance Report after

considering the performance and attributes of the candidate. It is asserted

that in the present case, the Special Performance Report was not prepared.

CVC report also was not called for. ACC in their communication dated

25th July, 2014, had earlier asked the Ministry to apply the benchmarking

system. Despite this letter, the Ministry for specious reasons did not apply

the benchmarking system, even when the benchmarking system brooks no

exception. In these circumstances, the communication of the Ministry

dated 1st August, 2014, is untenable and liable to be struck down. The

petitioner it is accepted had remained under suspension from 22nd

February, 2013 to 8th May, 2014 but this suspension was unjustified. The
WP(C) No.2056/2015                                               Page 3 of 15
 petitioner should be given pay and allowances for this period in terms of

the Office Memorandums dated 22nd October, 1964 and 3rd December,

1995. Further, the suspension of the petitioner was irrelevant. The CMD,

NPCC had erroneously not filled up the proforma, assessing the

petitioner‟s benchmark before he had retired on 31st March, 2013. The

contention of the petitioner is that the CMD concerned was prejudiced and

was responsible for initiating a motivated enquiry. The petitioner was not

accorded vigilance clearance as he was under suspension and inquiry

proceedings were pending. The guidelines nowhere provide that

benchmarking was not required if the employee was awarded penalty of

censure. The PAR (Personal Appraisal Report) gradings of the petitioner

ranged from „Good‟ to „Very Good‟.          In spite of this, the Special

Performance Report was neither prepared as per the benchmarking system

nor forwarded to the ACC.        As the petitioner was under suspension

between 22nd February, 2013 to 8th May, 2014, his PAR for the period

2013-14 could not be written. The CMD at the relevant time had not seen

the work of the petitioner as he was reinstated on 8th May, 2014. It was,

therefore, not possible for the CMD to assess the petitioner‟s performance.

The petitioner‟s performance appraisal report should have been prepared

on the basis of previous years‟ PAR.

6.     We do not find any merit in the contentions raised by the petitioner,

which are devoid of legal substance and force. At the outset, we would
WP(C) No.2056/2015                                               Page 4 of 15
 explicitly clarify that we are not examining and commenting on merits on

the penalty of „censure‟, as this is not the subject matter of challenge and

directly an issue before us. The limited issue that arises for consideration

in the present writ petition is whether the petitioner has been wrongly

denied extension of tenure as the Director (Finance), NPCC. We would in

the beginning observe that extension of tenure cannot be claimed as a

matter of right. Tenure appointments are for the period specified. These

contractual appointments are subject to the terms agreed and settled. It is

within the domain and power of the respondents and the petitioner to agree

or not agree to accept and accord extension of tenure. When a tenure

appointment comes to an end, the respondents may or may not extend the

tenure. Equally, the person may not accept or agree to another term. Of

course, if the respondents act in an arbitrary manner, capriciously and

contrary to law and do not extend the tenure on extraneous or irrelevant

considerations, the said wrong can be checked and corrected. This is the

limited scope in which a Court/tribunal exercises Power of judicial review

in order to ensure objectivity and fairness in State action and the Courts do

not act as an appellate forum.

7.     By Office Memorandum dated 31st March, 2011, the Department of

Personnel and Training had communicated to different authorities/public

sector enterprises the guidelines, which should be followed, when a case is

referred to the ACC for extension. The said guidelines read :-
WP(C) No.2056/2015                                               Page 5 of 15
                "(a) All cases of extension shall be referred to the
               ACC, as is the existing procedure.

               (b) The PESB shall, in consultation with the DPE,
               evolve a benchmarking system to be applicable
               while considering proposals for extension.

               (c) All proposals in which the incumbents
               meet the benchmark          and      the Ministry/
               Department decides to recommend extension shall
               be referred to the ACC for approval, not later
               than two months before the scheduled expiry
               of the tenure of the incumbent. No reference would
               be needed to PESB for a fresh joint appraisal.

               (d) All proposals, wherein the incumbents meet the
               benchmark, but have some other issue such as
               vigilance etc. for which the Ministry/ Department
               is not inclined to recommend extension, shall be
               referred to the ACC for consideration six months
               before the scheduled expiry of tenure of the
               incumbent.

               (e) All proposals wherein the incumbents do not
               meet the benchmark shall be referred to the PESB
               by the Department/ Ministry concerned. This
               reference has to be six months before the scheduled
               expiry of tenure of the incumbent.             The
               recommendation of the PESB shall be referred to
               the ACC, for orders as at present.

               (f) All proposals wherein the Ministry suggest
               termination/non-extension of the incumbent shall
               be accompanied by the proposal for giving
               additional charge."

8.     In the present case, we had called for the original records from the

Ministry of Water Resources, River Development and Ganga Rejuvenation

to examine how the question of extension of tenure in the case of the

petitioner was examined. The file shows and establishes a detailed, fair
WP(C) No.2056/2015                                                Page 6 of 15
 and objective consideration. The Ministry of Water Resources was aware

of the said guidelines dated 31st March, 2011. The Ministry of Water

Resources had solicited ACC‟s approval for non-extension of the

petitioner's tenure beyond 20th July, 2014 and to approach Public

Enterprise Selection Board for appointment of the Director (Finance),

NPCC. On a query being raised by the ACC, they were informed that the

proposal sent for non-extension of petitioner‟s tenure had the approval of

the Minister. The proposal was placed before the ACC, but they had at the

first instance directed that it should be ascertained from the Ministry

whether the petitioner meets the prescribed performance benchmark

required for extension of tenure. The Ministry was accordingly directed to

comply with the direction and furnish clarification. In reply, the Ministry

wrote a detailed letter dated 1st August, 2014 stating that the petitioner‟s

benchmark was not assessed for several reasons; (i) petitioner was under

suspension with effect from 22nd February, 2013 to 18th May, 2014 and

during this time, enquiry proceedings were pending; (ii) CMD, NPCC had

not filled up the proforma for assessing the benchmark and had retired on

31st March, 2013; (iii) No proposal for extension of tenure was received

from the NPCC within the prescribed period; (iv) The petitioner was not

accorded vigilance clearance as he was placed under suspension and

enquiry was going on.; (v) In the enquiry proceedings, penalty of „censure‟

had been imposed on the petitioner with the approval of the competent
WP(C) No.2056/2015                                               Page 7 of 15
 authority; (vi) Copy of the PAR grading and the status of PAR was

enclosed. As the petitioner was under suspension from 22 nd February,

2013 to 8th May, 2014, his PAR grading for 2013-14 could not be written;

and (vii) The benchmark proforma had not been filed by the CMD and

countersigned by Secretary of Administrative Ministry. Furthermore, the

present CMD and the Secretary had not seen the work of the petitioner for

sufficient time and, therefore, it was not possible for them to assess his

performance.

9.     It is, therefore, clear to us that the ACC was conscious and aware of

their guidelines dated 31st March, 2011. The attention of the Ministry was

drawn to the said guidelines and their response dated 1 st August, 2014 was

communicated to the ACC. On examining the said response, the ACC was

satisfied that they could examine the case objectively and decide whether

or not the extension of tenure should be granted. The respondent Ministry

had accepted that the performance of the petitioner viz. the benchmark had

not been assessed for the reasons stated by them. It is not the case where

the ACC did not examine the aforesaid aspects. Upon consideration of

relevant facts, the ACC came to the conclusion that the approval should be

granted against non-extension of tenure in the present case.

10.    The guidelines dated 31st March, 2011, are in the nature of

administrative instructions. In the factual background of the case in

question and after considering the entire record, including the PAR grading
WP(C) No.2056/2015                                               Page 8 of 15
 in earlier years on consideration of the letter dated 1st August 2014 by their

letter dated 26th September, 2014 the ACC conveyed their approval on

proposal for non-extension of tenure after in depth and thorough

examination.     This scrutiny and conclusion cannot be bludgeoned and

brushed aside as if there was lack or absence of independent application of

mind by the ACC. This is a case in which there was contemplative and

reflective examination of the relevant facts and issues and thereafter, it was

decided that the extension of tenure should not be granted.

11.    Adherence to the guidelines in question is for a purpose and

objective.    It enables the ACC to examine each case expeditiously,

transparently and in a fair manner. It helps in taking decisions. Facts

of the

present case are peculiar. The petitioner himself had levelled allegations

and casted aspersions on the objectivity and conduct of the earlier CMD.

Filling of the PARs by the said CMD and awarding of benchmarks would

have been questioned and challenged for lack of objectivity, etc. It is in

this context that we have to examine and consider the actions of the

respondents. Guidelines are pointers and enablers like tools and

implements to effectively and methodically discharge and consider cases of

extension or non extension. They are not rigid rules, but procedural

guidelines. The guideline should be normally followed, but cannot read as

binding and inelastic rudiments and first principles. Law does not require

that the guidelines must be followed even when following them would

result in complications and asymmetrical consequences. When guidelines

are framed they should be adhered to, but at the same time, there has to be

flexibility when implementation of procedural guidelines in a particular

case or factual matrix would itself be impossible or create inequities.

12. Reliance placed upon the decision of the Supreme Court in

Dr.Amarjit Singh Ahluwalia Vs. The State of Punjab & Ors. (1975) 3

SCC 503, does not assist or further the case of the petitioner.

Administrative instructions, it was observed, do not have force of law but

the State should not depart from or negate them without rational

justification, and it was observed that to fix an artificial date for

commencement of continuous service for the purpose of giving seniority to

some in contravention of the said circular would violate Articles 14 and 16

of the Constitution. Pertinently, the ratio observes that the State should not

depart from their policy without rational justification. Articles 14 and 16

embody the principle of rationality. In the present case, we have noted the

rationale and reasons given by the Ministry and accepted by the ACC. In

the written submissions filed and in the submission recorded above, the

petitioner has sought to challenge and question each of the reasons given in

the communication of the Ministry dated 1st August, 2014 to allegedly

demonstrate that the reasons should not be accepted. This is not acceptable.

This is not the manner in which a decision taken by the administrative

authorities can be questioned and challenged. The scope of judicial review

is limited. Merits of the said decision are not amenable to legal scrutiny.

We do not think in the facts of the present case, the examination

undertaken by the ACC and the reasoning as to why guidelines for the

purpose of benchmark cannot be adhered to, can be rejected as make-

belief and whimsical. The reasoning has a good foundation.

13. Similarly in Virender S. Hoodav Vs. State of Haryana JT 1999 (5)

SC 621, it was observed that though an administrative instruction cannot be

enforced, a policy declared by the State as to the manner of filling up posts,

especially when in accord with the rules and instructions issued by the

Public Service Commission from time to time, should be followed. We

fail to understand how this decision is of any assistance to the petitioner in

the factual matrix of the present case, for the guidelines with regard to the

benchmarking were certainly examined with reference to the facts in

question, and thereafter, for reasons and grounds given by the Ministry, the

ACC went on to examine the question of non-extension of tenure. On

identical grounds, decision of the Delhi High Court in Anand Darbari vs.

Union of India and Anr. (2000) 84 DLT 718 would be of no assistance to

the petitioner.

14. Administrative law distinguishes between mandatory and directory

provisions. Procedural provisions are normally directory and not

mandatory. It is the intent of the legislature which determines as to

whether the provisions of law are mandatory or directory. For ascertaining

the real intention, one has to look at; the nature and design of the statute

and the consequences which would follow from construing one way or the

other; the impact of other provisions, whereby necessity of complying with

the provision in question is avoided; the circumstances, whether the statute

provides for a contingency for non-compliance with the provisions,

whether non-compliance is visited with some penalty; serious or the trivial

issues etc. (See State of U.P. Vs. Babu Ram Upadhya AIR 1961 SC 751).

15. In Gridco Limited and Another versus Sadanand Doloi and Others,

(2011) 15 SCC 16 while dealing with contractual employment and

termination of contractual employment, the Supreme Court examined the

difference between public and private law activities of the State, for the

State while exercising its powers and discharging its functions acts for

public good and in public interest. State action can be challenged on the

ground of arbitrariness, unfairness and unreasonableness. In this context, it

has been observed that even if the dispute falls within the domain of

contractual obligations, it would not relieve the State of its obligation to

comply with basic requirements of Article 14. These principles ensure

Rule of Law. However, these principles cannot invoke to amend, alter or

vary express terms of contracts between the parties when they are freely

entered into. The mutual rights and liabilities of parties are governed by

the said terms and law relating to contracts. Reference was made to State

of Orissa versus Chandra Sekhar Mishra, (2002) 10 SCC 583, Satish

Chandra Anand versus Union of India, AIR 1953 SC 250 and Parshotam

Lal Dhingra versus Union of India, AIR 1958 SC 36. Referring to DTC

versus Mazdoor Congress, 1991 Supp (1) SCC 600 and Central Inland

Water Transport Corporation Limited versus Brojo Nath Ganguly,

(1986) 3 SCC 156, it was observed as under:-

36. In Parshotam Lal Dhingra v. Union of India [AIR 1958 SC 36] this Court followed the view taken in Satish Chandra case [AIR 1953 SC 250] . Any reference to the case law on the subject would remain incomplete unless we also refer to the decision of the Constitution Bench of this Court in DTC v. Mazdoor Congress [1991 Supp (1) SCC 600 : 1991 SCC (L&S) 1213] where this Court was dealing with the constitutional validity of Regulation 9(b) that authorised termination on account of reduction in the establishment or in circumstances other than those mentioned in Clause (a) to Regulation 9(b) by service of one month's notice or pay in lieu thereof. Sawant, J. in his concurring opinion held that the provision contained the much hated rules of hire and fire reminiscent of the days of laissez faire and unrestrained freedom of contract and that any such rule would have no place in service conditions.

37. To the same effect was an earlier decision of this Court in Central Inland Water Transport Corpn. Ltd. v. Brojo Nath Ganguly [(1986) 3 SCC 156 : 1986 SCC (L&S) 429 : (1986) 1 ATC 103] where the Court had refused to enforce an unfair and unreasonable contract or an unfair and unreasonable clause in a contract entered into between parties who did not have equal bargaining power.

38. A conspectus of the pronouncements of this Court and the development of law over the past few decades thus show that there has been a notable shift from the stated legal position settled in earlier decisions, that termination of a contractual employment in accordance with the terms of the contract was permissible and the employee could claim no protection against such termination even when

one of the contracting parties happened to be the State. Remedy for a breach of a contractual condition was also by way of civil action for damages/compensation. With the development of law relating to judicial review of administrative actions, a writ court can now examine the validity of a termination order passed by public authority. It is no longer open to the authority passing the order to argue that its action being in the realm of contract is not open to judicial review.

39. A writ court is entitled to judicially review the action and determine whether there was any illegality, perversity, unreasonableness, unfairness or irrationality that would vitiate the action, no matter the action is in the realm of contract. Having said that we must add that judicial review cannot extend to the Court acting as an appellate authority sitting in judgment over the decision. The Court cannot sit in the armchair of the Administrator to decide whether a more reasonable decision or course of action could have been taken in the circumstances. So long as the action taken by the authority is not shown to be vitiated by the infirmities referred to above and so long as the action is not demonstrably in outrageous defiance of logic, the writ court would do well to respect the decision under challenge.

40. XXXXX

41. It is also evident that the renewal of the contract of employment depended upon the perception of the management as to the usefulness of the respondent and the need for an incumbent in the position held by him. Both these aspects rested entirely in the discretion of the Corporation. The respondent was in the service of another employer before he chose to accept a contractual employment offered to him by the Corporation which was limited in tenure and terminable by three months' notice on either side. In that view, therefore, there was no element of any unfair treatment or unequal bargaining power between the appellant and the respondent to call for an over- sympathetic or protective approach towards the latter."

16. In the factual matrix of the present case it cannot be said that the

failure to resort to benchmarking criteria vitiates the ACC decision. The

guidelines stipulated in letter dated 28.06.2011, as noticed above are to

expedite the process and help the ACC in taking a decision objectively,

transparently and without calling for records and information.

17. In light of the above, we do not find any merit in the present writ

petition and the same is dismissed. There will be no order as to costs.

-sd-

(SANJIV KHANNA) JUDGE

-sd-

(NAJMI WAZIRI) JUDGE APRIL 29, 2016 NA/VKR