Patna High Court
Sri Kaushal Kishore Prasad And Ors. vs Union Of India (Uoi) And Ors. on 25 April, 1991
Equivalent citations: 1991(39)BLJR1056
JUDGMENT G.C. Bharuka, J.
1. The present writ application has been filed by the employees of the Bihar State Social Welfare Advisory Board, Patna (hereinafter to be referred to as 'the State Board"). The petitioners have prayed for issuance of a writ of mandamus commanding the respondents to grant them the scale of pay with effect from 1-4-1981 in accordance with the recommendations of the 4th Pay Revision Committee. The petitioners have also prayed for quashing the decision of the State Government contained in letter No. 3/G-1--109-K-2441 dated 14th March 1985, by which it has been decided that the employees of the State Board will be entitled to the revised pay scale only with effect from 1st April, 1983. This letter is Annexure 3/2 to the writ application.
2. Keeping in view the recommendations of the Planning Commission, the Government of India constituted Central Social Welfare Board in the year 1953 (hereinafter to be referred to a 'the Central Board'). It was constituted with the object to provide assistance and guidance to Voluntary Social Welfare Organisations in consolidating and improving their social welfare activities. The Central Board after its constitution took up a large number of Well are Extension Projects which included Welmen's and Children's Welfare Projects as also the welfare projects of juvenile delinquents and the handicapped. Inspired by the activities of the Central Board, the State Government also, in consultation and pursuant to an agreement with the Central Board, constituted the Respondent State Board. A declaration to this effect is contained in the Government decision dated 1st December, 1954 expressed in the name of the Governor wherein it has been declared that the Government of Bihar have decided to constitute a non-official Board to be known as the Bihar Social Welfare Advisory Board. This declaration in para 2 also contains the names of the Chairman and the Members of the Board which were decided with the approval of the Central Board. This decision is contained in Annexure 'B' to the counter-affidavit. Rules governing the composition and functions of the State Board have been filed as Annexure '8' to the writ application. These rules, apart from laying down procedures for composition of the State Board, also provides for functions of the State Board, mode of operation of its bank accounts, powers of the Board and provisions with regard to budget. Rule 4 provides that the office bearers of the Board shall be the Chairman, Vice-Chairman and Treasurer. Under Rule 3 (v) the Chairman is appointed by the mutual agreement between the Chairman, Central Board and the State Government. Under Rule 4 the Vice-Chairman of the Board is to be selected by the State Board from among its members. The treasurer of the state Board has to be appointed by the State Government from among its official members. Rule 9 provides that the Board shall maintain a current account with the State Bank of India or with any Scheduled Bank. All the receipts of the Board are to be paid into the Board's Bank Account and no account can be drawn from this account except on cheques signed by any of the two out of aforesaid three office bearers. Rules 10 and 12 deal with the powers of the Board and its bud get. These two rules read as follows:-
10. Power of the Board.--(i) The Board shall have power to make appointment to posts sanctioned by the Central Board on terms to be prescribed with the prior approval of the Central Board, except the Secretary of the Board who shall be appointed by the Board in consuliation with the Central Board.
(ii) The authority competent to promote, degrade or dismiss an officer or servant of the Board shall be the authority empowered to appoint such officer or servant in all these matters, the State Board shall apply relevant service rules of the State Government.
(iii) There shall be a standing Committee of the Board consisting of the Chairman, Vice-Chairman, Treasurer and two more members of the Board. The Standing Committee shall look after the management of all the affairs and funds of the Board within the limits and directions prescribed by the Board.
(iv) The Board shall have the power, to make if, necessary, such bye-laws as are not repugnant to or inconsistent with these rules, for the conduct of the Board's business and for the working of its office.
(v) The Board may, by resolution, delegate to sub-committees and panel of experts to deal with specific problem or groups of problems for such powers as the Board may deem fit.
(vi) The Board may, where necessary, appoint ad hoc committee for specific purposes. The sub-committees will not be empowered to take decision on behalf of the Board.
(vii) The Board may, by resolution, delegate to the Chairman, or the Secretary, such of its powers for the conduct of its business as it deem fit subject to the condition that the action taken by the Chairman or the Secretary under the power delegated to them by this regulation shall be reported for confirmation at the next meeting of the Board.
12. Budget.--(i) The Board shall in each year submit to the Central Social Welfare Board its revised budget for the current year and its budget estimates for ensuing year as passed at one of its meetings in the form prescribed by the Central Board. It shall not contain provisions for any scheme which have not been duly approved by the Central Board. The expenditure incurred on the establishment of the Office of the State Board will be shared equally by the Central Board and the State Government.
(ii) The funds of the Board shall not be appropriated for expenditure on any item which has not been approved by the Central Social Welfare Board.
3. From a bare reading of Rules 10 and 12, quoted above, it is clear that so far as its employees except the Secretary are concerned, the State Board has the full competence to appoint employees on the posts sanctioned by the Central Board on such terms, which are approved by the Central Board. But as per Clause (ii) of Rule 10 the relevant Service Rules of the State Government will be applicable to the employees of the State Board in respect of promotion, degradation and dismissal, which can be exercised by the appointing authority of the State Board, Rule 12(1) inter alia, prescribes that the State Board shall seek approval of its budgetary estimates. It further provides that the expenditure incurred on the establishment of the office of the State Board will be shared equally by the Central Board and the State Government."
4. Mr. Basudeo Prasad, learned Senior Counsel, appearing for the petitioner has submitted that in view of the aforesaid facts and circumstances and the conditions attached to the constitution of the State Board, the State Government cannot have any say either in respect of laying down of the terms and conditions including fixation of pay scale of the employees of the State Board nor the State Government has any authority to, in any way, interefere with the budgetary estimates or expediture of the State Board. In all these matters the only competent authority, who can interfere, annul or vary the decisions of the State Board is the Central Board. According to Mr. Prasad once the Central Board approves the pay scale of the employees from a particular point of time then the entire expenditure incurred on this head has to be necessarily borne by the State Government to the extent of 50% as per rules of the State Board. This was agreed upon by the State Government as a condition to the very inception of the State Board.
5. The learned Advocate General appearing for the State of Bihar, on the other hand, has submitted that since the State Government have allowed the pay revision as per the recommendations of the 4th Pay Revision Committee in respect of all the Boards and Corporations, like Patna Municipal Corporation, District Board, etc. only with effect from 1-4-1983 and not with effect from l-4-198l as has been done in the case of the employees of the State Government the petitioners are not entitled to the relief claimed as it would otherwise amount to discrimination between the employees of the Board and Corporation of the State Government at one hand and the employees of the State Board on the other hand and it may lead to serious financial implications on the exchequer of the State.
6. The first question to be determined in this case is as to what is the legal status of like State Board. Whether it can be said to be a department or agency or instrumentality of the State Government. From the foregoing paragraphs, which give out the history of the constitution of the State Board and the rules of its functioning. It is clear that the intention of its promoters, i.e. the State Government and the Central Board was a constituent or an independent legal entity to carry out certain objects and functions assigned to it. The Board was given a name and was provided with the mode and manner for appointing its members and office bearers. Necessary provisions have been made for its independent fund for carrying out its budgetary schemes and expenditures. Under Entry 32 of List 2 of the 7th Schedule of the Constitution read with Article 162 thereof, the State Government has the competence to give the Board the status of a Corporation in a legal sense. In the case of S.S. Dhanoa v. Municipal Corporation, Delhi and Ors. it has been held that--
A corporation is an artificial being invisible, intangible, and existing only in contemplation of laws. Being the mere creator of law, it necessitating only those properties which the charter of its creation confers upon it, either expressly or as incidental to its very existence. These are such as are supposed best calculated to effect the object for which it was created. Among the most important are immortality, and if the expression may be allowed, individuality, properties, by which a perpetual succession of many persons are considered as the same, and may act as a single individual. They enable a corporation to manage its own affairs, and to hold property, without the perplexing intricacies, the hazardous and end necessity of perpetual conveyances for the purpose of transmitting it from hand to hand.
From the aforesaid discussions, it clear that the State Board is neither a department of the Government, nor it is its agency in stricto sensu. The state Board is an independent legal entity. It is its own matter and has the full authority to take decisions with regard to its affairs including appointment of the employees and laying down terms and conditions subject to the approval of the Central Board, The State Government have no authority to interfere in any of these matter. It is also clear that once the budgetary estimates and the expenditures are approved by the Central Board then the State Government is duty bound to reimburse 50% of such expenditures to the State Board.
7. Now coming back to the facts of the case, pursuant to the recommendations of the 4th Pay Revision Committee, the scale of pay of the employees of the State Government were revised with effect from 1-4-1981. Subsequently the State Board also took a decision to revise the pay scale of its employees in the line of revision of pay scales of the employees of the State Government with effect from 1-4-1981. This decision of the State Board was duly approved by the Central Board as contained in its letter No. F-3 (ii) 3/81/SB-Admn., dated 11-5-1982. In the letter of approval it was stated that the Central Board's liability with regard to the revised pay scale will be limited to 50%. This letter is Annexure 1 to the writ application. These facts have also been admitted in the counter-affidavit filed by the Secretary of the State Board.
8. It has been alleged by the petitioner that despite, the decision of the State Board and its willingness to pay the revised pay scale to its employees with effect from 1-4-1981, the Respondent Director, Social Welfare, Welfare Department, who has been appointed as the treasurer of the State Board by the State Government in term of Rule 4 is not signing the cheques and, as such payment is not being made to the petitioners.
9. From the foregoing discussions, I am clearly of the view that the State Government have absolutely no authority to interfere with the decision of the State Board, which are duly approved by the Central Board even with regard to fixation to pay-scale of the employees of the State Board and in this view of the matter, the decision of the Government contained in letter dated 14th March, 1985 (Annexure 3/2) is wholly unauthorised and ultra vires. As such the same is quashed. It is further held that keeping in view the decision of the State Board with regard to the revision of pay-scale of the employees as approved by the Central Board vide Annexure 1, the State Government is duty bound to reimburse 50% of the expenses incurred in this regard by the State Board. As such, it is directed that the State Government should provide necessary fund to the State Board within a period of 2 months from the date of communication of this order. Respondent No. 7 the Treasurer of the State Board is also directed to take all effective steps to implement the decision of the State Board with regard to the payment of revised pay-scale in question to its employees.
10. Accordingly, the writ application is allowed. However, there will be no order as to costs.