S.R. Tewari vs District Board Agra and Another
Rewritten Version Notice: This is a rewritten version of the original judgment.
Court: Supreme Court of India
Case Number: Civil Appeal No. 304 of 1962
Decision Date: 15 April 1963
Coram: J.C. Shah, Bhuvneshwar P. Sinha, N. Rajagopala Ayyangar
In the matter of S.R. Tewari versus District Board, Agra and another, decided on 15 April 1963, the Supreme Court of India, with Justice C.J. Shah presiding and joined by Justices Bhuvneshwar P. Sinha and N. Rajagopala Ayyangar, heard the petition filed by S.R. Tewari against the District Board of Agra and an additional respondent. The case was reported in the 1964 volume of the All India Reporter at page 1680 and also cited as 1964 S.C.R. (3) 55, with numerous subsequent citations listed. The legal questions arose under the Uttar Pradesh District Boards Act of 1922, specifically sections 82 and 84, and the applicable rule 3A(iv) of the District Board Rules, as well as the jurisdiction of the High Court under Article 226 of the Constitution of India to issue writs. The appellant, an engineer employed by the District Board, was informed that his services would be terminated; he received three months’ salary in lieu of notice and a formal notice of termination. He challenged the Board’s decision by filing an appeal to the State Government, which was rejected, and subsequently filed a writ petition before the High Court, which also dismissed his claim. The appellant argued that the Board did not possess statutory authority, under the 1922 Act, to end his employment except through dismissal as a punitive measure, and therefore his termination was unlawful. The respondents countered that, because the appellant was not a civil servant of the State, the High Court could not entertain a declaration that his appointment had not been properly ended. The Supreme Court held that a High Court, when exercising its writ jurisdiction under Article 226, may declare the act of a statutory body invalid if the body has violated a mandatory statutory requirement, even if such a declaration forces the body to act contrary to its wishes. Accordingly, the Court affirmed that the High Court had jurisdiction to declare that the appellant’s termination was not lawful, recognizing that such a declaration is permissible only when the court determines that the usual rule against specific enforcement of service contracts must be set aside. The judgment further noted that section 82 of the Act conferred upon the Board the power to appoint the engineer, and by implication, also the power to terminate the appointment.
The Court observed that section 82 of the District Boards Act, 1922, not only authorised the Board to appoint an engineer but also gave it the authority to terminate that appointment. Ordinarily, the power to appoint includes the power to dismiss. The specific procedure for terminating a service was set out in rule 3A(iv) of the District Board Rules. Accordingly, the appellant’s employment was ended by serving a notice that complied with this rule, and the authority that could terminate the appointment was the same authority that was empowered to appoint a successor to the engineer concerned. The Court noted that the dismissal of a servant of the Board must be carried out in accordance with the rules made under section 84, which require that the servant be given a reasonable opportunity to be heard and a show‑cause notice. The Court clarified that this procedure for dismissal does not apply to a termination of service. Dismissal, as understood by the Court, refers to the determination of employment as a punitive measure for misconduct or another cause, rather than a termination that follows the statutory rule‑based procedure.
In the present matter, the appeal was styled Civil Appeal No. 304 of 1962 and was filed against the judgment and decree dated 1 December 1958 of the Allahabad High Court in Civil Miscellaneous Writ No. 270 of 1956. Counsel for the appellant and the respondents were instructed in the usual manner. The judgment was delivered on 15 April 1963. The factual background recorded that on 18 October 1954 the District Board of Agra resolved to terminate the appellant’s employment as Engineer, providing him with salary in lieu of notice for three months and giving him notice of the termination. The appellant appealed this termination to the Government of Uttar Pradesh, but his appeal was dismissed on 5 December 1956. Consequently, the appellant filed a petition before the High Court of Allahabad under Article 226 of the Constitution, seeking a writ of certiorari to set aside the Board’s resolution of 18 October 1954 and the State’s order of 5 December 1956, and also seeking a writ of mandamus directing the Board and the State to continue treating the appellant as the lawfully appointed Engineer and not to enforce the termination resolution. The appellant contended that he had rendered flawless service, but a Board member named Tota Ram was allegedly annoyed with him for reasons unrelated to his duties, and the President of the District Board was allegedly displeased with him for reasons known only to the President. The appellant maintained that, despite his long and honest service, the Board had capriciously and without justification terminated his employment, rendering the resolution invalid. On the other side, the Board submitted an affidavit alleging that the appellant was guilty of negligence and unfaithfulness, had been censured, his annual increments were stopped, and he had previously been dismissed, although that dismissal was later rescinded. The affidavit listed several incidents to support the Board’s claim that it was competent to terminate the appellant’s services and that the termination was valid and not open to challenge. The State of Uttar Pradesh submitted that the termination was in accordance with rule 3A(iv) of the District Board Manual, that no appeal lay against the resolution under that rule concerning officers and servants of District Boards, and that the State’s order rejecting the appellant’s appeal was correct. The High Court dismissed the petition, holding that under the fourth proviso to section 82 of the District Boards Act, 1922, the Board possessed the power to appoint and to determine the employment of an Engineer of the Board, and that this power was exercised in accordance with the statutory procedure.
The Board submitted an affidavit in which it asserted that the appellant had been guilty of negligence and unfaithfulness, that he had been formally censured, that his yearly salary increments had been withheld, and that he had at one time been dismissed, although that dismissal had subsequently been rescinded. The affidavit listed several specific incidents that it said supported its allegations and argued that the Board, being a competent authority, had rightfully terminated the appellant’s services; consequently, the affidavit contended that the resolution effecting his termination could not be lawfully challenged. The State of Uttar Pradesh then placed before the Court a submission that the appellant’s services had been terminated in conformity with rule 3 A (iv) of the District Board Manual, that no right of appeal existed against a termination made under that rule governing officers and servants of district boards, and that the State Government’s order rejecting any appeal was therefore correct. The High Court, after hearing the matter, dismissed the petitioner’s writ, holding that, pursuant to the fourth proviso of section 82 of the District Boards Act 1922, the Board possessed the authority both to appoint and to determine the employment of an Engineer of the Board, and that, unless the termination was intended as punishment, the Board could exercise that authority in the manner prescribed by rule 3 A clause (iv), which required either a three‑month notice or payment of salary in lieu of notice. The High Court rejected the appellant’s argument that the dismissal power under the fourth proviso could be invoked only to punish a delinquent servant and only after observing a specific procedural regime, and also rejected the proposition that, apart from the power to dismiss, the Act granted no authority to determine employment, which would render rule 3 A clause (iv) ineffective. The appellant appealed against the High Court’s order, obtaining a certificate of appeal from that Court. Counsel for the Board, in a preliminary objection, maintained that the appellant was not a member of the State civil service and therefore could not claim the protection of article 311 of the Constitution; further, it argued that the relief sought—namely, an order restoring the appellant to his former position—was beyond the jurisdiction of the High Court even under article 226, being limited by section 21(b) of the Specific Relief Act, and that the appropriate remedy, if any, would be a suit for damages arising from wrongful termination rather than a writ declaring the termination unlawful and ordering reinstatement. The Board relied on the authorities Municipal Board, Shahjahanpur v. Sardar Sukha Singh, Ram Babu Rathaur v. Divisional Manager, Life Insurance Corporation of India, and Dr. S. B. Dutt v. University of Delhi to support its position, but the Court found that none of those decisions could be used to sustain the view that the
The High Court was held not to possess authority to declare the statutory obligations that bind a statutory body. Under common law, a court does not normally compel an employer to retain an employee who is no longer desired. Nevertheless, that general rule is qualified by several well‑recognised exceptions. In appropriate cases, courts may declare that a public servant who has been dismissed in violation of Article 311 of the Constitution shall continue to be considered in service, even though such a declaration effectively obliges the State to keep employing a person it would prefer not to retain. A similar principle operates in industrial law, where labour and industrial tribunals have jurisdiction to order an employer to employ a worker whom the employer does not wish to retain. Courts also have the power to declare an act of a statutory body invalid where the act infringes a mandatory statutory duty, even if the declaration forces the body to do something it would rather avoid. The Allahabad High Court decision in Municipal Board, Shahjahanpur v. Sukha Singh (1) I.L.R.(1937) All. 334, articulated the principle broadly, stating that the court lacks jurisdiction to force an employer to keep a servant whose services are no longer required and that every employer may discharge a servant for whom there is no need. It was emphasized that the powers of any statutory body are always limited by the statute that created it and must be exercised in conformity with that statute; consequently, courts in suitable cases may deem an action of the body illegal or ultra rites, even when that action pertains to the employment status of a servant. In the case of Ram Babu Rathaur (1) A.I.R (1961) All. 502, the court examined whether an employee of the Life Insurance Corporation, whose employment had been terminated, could obtain a writ of mandamus restoring him to service or a writ of certiorari setting aside the corporation’s proceedings. The corporation, being an autonomous entity rather than a department of the State, governs its relationship with employees through contract and is not bound by any statutory employment obligation. Accordingly, the court correctly held that, absent a specific statutory provision or special contract, the relationship must be resolved by the general law of master and servant. In Dr S.B. Dutt’s case (2) [1959] S.C.R. 1236, this Court observed that an arbitrator’s award declaring the dismissal of a Delhi University employee to be “ultra vires, mala fide, and having no effect on his status” was merely rhetorical, as the dispute was rooted in contract. The award was therefore held to be contrary to section 21(b) of the Specific Relief Act and consequently void.
In that earlier decision, the Court observed that the arbitrator’s award declaring the professor’s dismissal from the University to be “ultra vires, mala fide, and having no effect on his status” contained an evident error, because the award attempted to enforce a contract of personal service, a matter that was not subject to review on the ground that the University had acted contrary to a statutory provision. The Court therefore held that the rights and obligations of the parties were governed solely by contract, and that the arbitrator’s description of the dismissal as “ultra vires” was merely ornamental language without substantive meaning in the context of the dispute between the parties. Consequently, the award was declared void as it violated the rule set out in section 21(b) of the Specific Relief Act, a conclusion supported by the authorities cited as (1) A.I.R., (1961) All, 502 and (2) [1959] S.C.R., 1255.
The question of whether a court could validly issue a declaration of invalidity concerning the termination of a servant’s employment by a statutory body was later considered by the House of Lords in Vina v. National Dock Labour Board. In that case, the plaintiff, a dock worker enrolled in the reserved pool created under the Dock‑Workers (Regulation of Employment) Order, 1947, failed to obey an order to report for work with a stevedoring company. The local board’s disciplinary committee heard the matter and terminated the plaintiff’s employment with seven days’ notice, a decision that was affirmed by the appellate board. The plaintiff subsequently sued, seeking a declaration that his dismissal was illegal, ultra vires and void, together with damages for wrongful termination. While the trial court granted both the declaration and the damages, the Court of Appeal set aside the declaration. The House of Lords restored the declaration, holding that the dismissal was a nullity because the local board lacked authority to delegate its disciplinary functions. This outcome demonstrated that, prima facie, a court possesses jurisdiction, in appropriate cases, to declare an order of a statutory body void even where the order pertains to the termination of a servant’s employment.
The counsel for the Board argued that a petition for a declaration that the appellant’s employment had not been lawfully terminated, and that consequently the Board should be commanded to continue the appellant in service, could not succeed. The Court rejected that contention, stating that the Board’s argument could not be sustained. While the jurisdiction to declare the Board’s decision ultra vires exists, it may be exercised only when the court is convinced that an exception to the general rule—namely, that a contract of service is not ordinarily specifically enforceable—is warranted. The remaining issue, therefore, was whether the District Boards Act, 1922 conferred upon the Board the power to determine the employment of a servant by means other than dismissal as punishment, and whether that power could be exercised for the purpose in question.
Court observed that several provisions of the District Boards Act, 1922 and the rules made thereunder are relevant to the issues on the record. Chapter IV of the Act governs the officers and servants of a Board. The Act defines a “servant” of the Board in section 3(ii) as “a person in the pay and service of the Board.” Section 72 imposes on the Board a duty to make appointments, in addition to the Secretary and the Superintendent of Education, of such officers or servants as may be required by the rules. Under Chapter IX of the rules framed under the Act, the Board is required to appoint a District Board Engineer who possesses the qualifications specified in that chapter. Consequently, an Engineer is regarded as an officer or servant whose appointment the Board is legally bound to make.
Section 82 confers administrative authority on the President and the Secretary with respect to a number of matters relating to the servants of the Board. The section provides that, except in the cases covered by sections 70, 71 and 72, the power to decide every question concerning service, leave, pay, allowances and privileges of Board servants who are employed, whether on a temporary or permanent basis, and who draw a monthly salary exceeding Rs 40, together with the power to appoint, grant leave of absence, punish, dismiss, transfer and otherwise control such servants, shall vest in the President. The same section states that, for all other servants of the Board, those powers shall vest in the Secretary. The provision is followed by four provisos, the fourth of which is material. The fourth proviso declares that the power to appoint and to dismiss the Engineer, the tax officer and the accountant of the Board shall vest in the Board, subject, in the case of dismissal, to a right of appeal to the State Government within one month of the dismissal order.
Section 84 provides that the provisions of sections 79, 73, 80 and 82 are subject to certain other rules. These include any rule that imposes conditions on the appointment of persons to offices requiring professional skill, on the punishment or dismissal of such persons, and on their liability to service under any Government order in the event of an emergency, as well as any other rule relating to servants of a Board. Section 172 empowers the State Government to make rules under the Act. Under this authority the State Government may make rules that are consistent with the Act, either by providing for any matter for which the State Government has power expressly or by implication from this or any other enactment in force at the commencement of the Act, or by furnishing general guidance to a Board, any Committee of a Board or any Government officer in connection with the implementation of the provisions of the Act. The Court noted that the scheme created by sections 72, 82, 84 and 172, when read together with the relevant rules, establishes the framework within which the Board’s power to appoint and dismiss an Engineer must be exercised.
In the matter before the Court, the relevant statutory scheme provided that an Engineer of the Board could be appointed only by a special resolution passed by the Board itself. The President of the Board possessed the authority to decide all questions that arose concerning the Engineer’s service, including matters of leave, pay, allowances and privileges, as well as the power to grant leave of absence, to punish, and to transfer the Engineer. However, the power to both appoint and dismiss an Engineer was lodged with the Board, and any dismissal order could be appealed to the State Government. The President’s and the Board’s powers were subject to the rules that imposed conditions on the punishment or dismissal of an Engineer and to other rules governing the servants of the Board. The State of Uttar Pradesh, exercising the powers conferred by section 172 (2) of the Act, had framed several rules, two of which were material to the present case. The first material rule was contained in Chapter III of the Rules dealing with officers and servants of the Boards and was identified as rule 3A. Rule 3A stipulated that the period of office of a permanent servant of the Board, other than a Government servant, would not terminate until one of several conditions was satisfied: either the servant’s resignation had been accepted in writing by the authority competent to appoint his successor or the servant ceased to be in service by operation of the rules regulating retirement of district board servants; or the servant had given the authority at least three months’ notice where his pay exceeded Rs 15 and, in other cases, at least one month’s notice; or the servant had paid or assigned to the Board a sum equal to three months’ pay where his pay exceeded Rs 15 and, in other cases, a sum equal to one month’s pay; or the authority competent to appoint his successor had given the servant not less than three months’ notice or a sum equal to three months’ pay in lieu of notice where his pay exceeded Rs 15 and, in other cases, not less than one month’s notice or a sum equal to one month’s pay in lieu of notice.
The second material rule was issued by a Notification of the Government of Uttar Pradesh dated 25 March 1946 and was titled “Regulation regarding dismissal, removal or reduction of officers and servants of District Boards.” This Regulation stipulated that no officer or servant could be dismissed, removed or reduced without being afforded a reasonable opportunity to show cause against the proposed action. It required that any written defence tendered be recorded and that a written order be passed on the basis of that defence. Furthermore, every order of dismissal, removal or reduction had to be issued in writing, specifying the charge brought, the defence presented, and the reasons for the order. Although designated a Regulation, both the Board and the State of Uttar Pradesh conceded, and the Court correctly accepted, that this instrument was in fact a rule framed under the powers conferred by section 179 (2) and not a Regulation made under the powers of section 173.
The Court observed that the Act itself does not give the State Government any authority under clause (2) of section 73 to make regulations that would control how the power of dismissal of officers or servants of the Board is exercised. Consequently, the existing rules require that any dismissal, removal or reduction of an officer or servant can be carried out only after that person has been afforded a reasonable opportunity to show cause against the proposed action. Nevertheless, the rules also provide that even a permanent servant of the Board may have his services terminated in accordance with the procedure set out in rule 3A. On October 18, 1954, the Board passed a resolution in which it claimed to exercise its power of determination pursuant to the method and conditions stipulated in rule 3A. The Court noted that such a determination, being made by a resolution of the Board, is prima facie effective. The appellant’s counsel argued that because the Act does not expressly confer a power to determine employment, any rule that attempts to limit the exercise of such a power is completely ineffective. It was further submitted that although the State Government has prescribed certain conditions for terminating the employment of a permanent servant of a Board, the Legislature has not given the Board a power to terminate employment except as a punitive dismissal, rendering those conditions meaningless. The Court rejected this argument. It held that section 82 expressly delegates to the Board the authority to decide service‑related questions, including the powers to punish, dismiss, transfer and control its servants. This authority is delegated to the President where the servant’s salary exceeds Rs 40 per mensem, and to the Secretary for all other servants, subject to the provisos attached to the section. Moreover, the exercise of the powers conferred by section 82 is further constrained by the provisions of section 84. Section 84 imposes additional limits, among others, by requiring that rules may prescribe conditions for the appointment to offices that require professional skill, as well as for the punishment or dismissal of persons appointed to such offices, and by mandating rules that relate specifically to the servants of the Board. Accordingly, the rule that sets out the procedure for terminating the employment of Board servants qualifies as a rule relating to those servants and can validly be made under section 84(d) read with section 172(2). The Court explained that the power to appoint generally includes the inherent power to terminate that appointment, and that, in the absence of any express or implied restriction, the authority competent to appoint may also exercise the power to terminate, provided the conditions prescribed for such termination are observed. Therefore, the power to terminate employment is found in section 82, while the manner of exercising that power is governed by the rules specified in section 84. The Court further noted that those rules set out the conditions under which an officer or servant may be terminated.
It was submitted that the dismissal of a servant could be effected as a form of punishment and that the same process might also be used for the simple determination of employment. The argument was raised that Rule 3A did not specify which authority was required to carry out a termination. However, clause (iv) of the rule provides that the tenure of a permanent servant of the Board shall not come to an end until the authority competent to appoint a successor gives that servant notice of the specified duration. Consequently, the notice itself brings the employment to an end, and the authority that can give such notice is the same authority that is competent to appoint the successor. The Court could not agree with the High Court’s view that the term “dismissal” in the fourth proviso to section 82 includes a plain termination of employment without any punitive element. In master‑servant law, “dismissal” has acquired a restricted meaning, namely, the termination of employment that is employed as a punishment for misconduct or some other cause. That restricted meaning is the one employed in the rule issued by the Notification of 25 March 1946. Under section 84, the power of dismissal granted by section 82 may be exercised only subject to the provisions of that rule, and therefore the terms “dismiss” and “dismissal” must carry the same sense in the legislation that governs the exercise of that power and the procedure to be followed.
The High Court’s interpretation would have the effect of requiring the procedure laid down in the 1946 Notification to be followed even for a mere termination of employment that is not punitive. Section 82 itself contains an inherent indication that the term is to be understood in a limited sense. The first proviso to section 82 grants servants of the Board a right of appeal against orders of the President that impose a fine exceeding one month’s salary, a suspension for more than one month, a reduction imposed as punishment, a supersession in promotion matters, and also against orders of dismissal. The orders imposing a fine, a suspension, a reduction or a supersession are clearly orders of punishment, and there is no reason why an order of dismissal, appearing in the same clause and also subject to appeal, should not be regarded as an order of that nature. The fourth proviso similarly provides a right of appeal against the Board’s order dismissing certain senior servants. An appeal against an order that merely determines employment, which may ordinarily be made in the ordinary exigencies of service, would serve no useful purpose; the existence of a right of appeal indicates the punitive character of the order. In the Court’s view, it is within the competence of the State Government, under section 84 read with section 172(2), to make rules that impose conditions on the appointment and punishment of persons to offices, or to any particular office that requires professional skill, and to generally prescribe the conditions under which the servants of the Board are to serve.
In this case, the Court explained that the rules made under section 82 possessed an overriding effect when those powers were exercised. An order that merely determined a servant’s employment, without being an order of dismissal, had to be carried out in accordance with rule 3A because of the rules framed under clause (d) of section 84. Conversely, an order of dismissal that involved punishment had to be consistent with the rule or regulation issued under the Notification dated 25 March 1946, which was made pursuant to sections 84(b) and 84(d). Accordingly, the Court held that the Board possessed the authority to determine the appellant’s employment and that the Board had purported to exercise that authority. Nevertheless, the appellant’s counsel argued that, although the Board used the form of a determination of employment, the substance of the action was in fact a dismissal, and that the Board’s resolution was only a camouflage for its true purpose. The Court noted that settled law recognized that the formal label of an order does not definitively reveal its true nature. A form may be employed merely to conceal an order of dismissal for misconduct, and the court before which such an order is challenged is always entitled to look beyond the form and ascertain the order’s real character. The Court further observed that, if it were to conclude that an order, though labeled as a determination of employment, was in reality a disguised dismissal serving as punishment, the Court would not be barred by the form of the order from giving effect to the statutory rights conferred upon the employee by the relevant rules.
The appellant’s counsel then pointed to an affidavit filed on behalf of the Board, which set out the appellant’s entire service record dating from 1945. The affidavit recorded that the appellant had been censured for neglect of duty on 25 March 1945, that he had been dismissed from service after the Public Works Committee found him guilty of negligence and unfaithfulness in 1946, that the Chairman of the Board, in 1947, had remarked that the appellant had not demonstrated loyalty and fidelity, and that the President of the Board had ordered the stoppage of the appellant’s increments in 1953 and again in 1954. The affidavit further relied on paragraph 21, which declared that the appellant’s plea that he had honestly and faithfully performed his duties and that the District Board had arbitrarily and without justification terminated his service was untrue, and it asserted that the termination of the appellant’s service had been justified. The Court observed, however, that in the petition the appellant contested the validity of the order terminating his services on the ground that the Board…
In this case, the appellant argued that the Board possessed no power to terminate his employment and, in addition, maintained that the termination was not justified. The appellant never claimed that the order ending his employment was, in substance, a dismissal imposed as punishment; rather, he asserted that the Board had simply acted capriciously and without justification. Consequently, the allegation that the Board’s action was intended to be a dismissal, even though the resolution was framed as a determination of employment, was not advanced as a pleading. Moreover, the records showed that no argument was presented before the Division Bench that the impugned resolution was, in reality, a dismissal. The judgment delivered by the Chief Justice addressed the sole issue placed before the Court, namely that although the Board could punish or dismiss the appellant, it lacked any authority to terminate his service absent a special contract, a contract that did not exist in the present circumstances. The Court observed that, had the appellant pleaded in his petition that the order, although worded as a determination of employment, was actually intended as a punitive dismissal and that the form had been used only to conceal the Board’s true purpose, the Board would then have been entitled to meet that allegation and to produce any evidence in its possession relating to that motive. The matter was thus primarily a question of fact, a question that had never been raised or examined by the High Court on a proper pleading. Allowing the appellant to introduce this new theory at this late stage would have taken the Board by surprise. Accordingly, the Court refused to consider whether the resolution dated 18 October 1954 was, in effect, a dismissal of the appellant from the Board’s service as a punishment for misconduct. For that reason, the appeal was dismissed. In view of the circumstances, the Court ordered that no costs be awarded, and the appeal was dismissed.