1. Challenge to a notice inviting applications for class II posts in a statutory corporation in the absence of framed regulations under the Road Transport Corporations Act, 1950. (Para 1 , 2 )
Back
Next 
1967 Supreme(SC) 288
SUPREME COURT OF INDIA
K.N. WANCHOO, C.J.I., R.S. BACHAWAT, V. RAMASWAMI, G.K. MITTER AND K.S. HEGDE, JJ.
The Mysore State Road Transport Corporation, Appellant
Versus
Gopinath Gundachar Char, Respondent.
Civil Appeal No. 1299 of 1967,
D/- 6-7-1967.
Advocates Appeared
Mrs. Shyamala Pappu and Vineet Kumar Advocates for Appellant; M/s. R. B. Datar and S. N. Prasad, Advocates for Respondent.
A statutory corporation can appoint officers and servants and determine their conditions of service to ensure efficient performance of its functions, even if formal regulations under the governing Act have not yet been framed, provided such appointments conform to any existing government directions.
Headnote:(A) Road Transport Corporations Act, 1950 - Sections 14, 19(1)(c), 34 and 45(2)(c) - Power to appoint officers and servants - Absence of regulations - Whether a statutory corporation can appoint staff and determine conditions of service before regulations are framed under Section 45(2)(c) - Section 14(2) expressly confers power to appoint officers and servants necessary for efficient performance of functions - Section 19(1)(c) empowers the corporation to provide suitable conditions of service - While Section 14(3) and 45(2)(c) provide for the framing of regulations, the absence of such regulations during the intervening period between the formation of the corporation and the framing of regulations does not deprive the corporation of the power to appoint staff on terms it thinks fit to ensure administration of its affairs. (Para 3)
(B) Administrative Power - General Manager’s authority to issue notice inviting applications - Falls within general powers of management. (Para 4)
(C) Promotion - No vested right to promotion unless established on record. (Para 4)
Facts of the case:
A class III employee challenged a notice inviting applications for class II Junior posts, contending that the corporation lacked the power to issue such notice as regulations prescribing conditions of appointment and scales of pay had not yet been framed under the relevant statutory provisions. The High Court quashed the notice, leading to the present appeal.
Findings of Court:
The High Court's judgment was erroneous. The corporation possesses the incidental power to appoint necessary staff to perform its functions regardless of whether formal regulations have been finalized.
Issues: Whether the corporation had the power to appoint officers and servants and lay down their conditions of service in the absence of regulations framed under Section 45(2) of the Road Transport Corporations Act, 1950.
Ratio Decidendi: The power to appoint staff under Section 14(2) is an essential function for the corporation's operation. While appointments must conform to regulations and government directions if they exist, the absence of such regulations does not paralyze the corporation's ability to hire necessary personnel to carry out its duties.
Result: Appeal allowed.
Legal Category Hierarchy
Table of Contents
2. Whether a statutory corporation can appoint officers and determine conditions of service before framing regulations under the governing Act. (Para 2 )
3. The Corporation possesses incidental power to appoint necessary staff for efficient performance, and the absence of regulations does not preclude such appointments during the intervening period. (Para 3 )
4. A statutory corporation may appoint officers and fix service conditions in the absence of regulations if the statute confers a general power to appoint staff. (Para 3 )
5. Can a statutory corporation appoint officers before framing regulations under the governing Act?
Yes. If the statute confers the power to appoint officers for efficient performance, the corporation may do so on terms it thinks fit until regulations are framed or government directions are issued. (Para 3 )
Judgement
BACHAWAT, J. : The respondent was a class III employee in the statistical department of the Mysore State Road Transport Corporation In October 1981, he was temporarily promoted to act as statistical superintendent at Hassan. On July 21, 1964, the General Manager of the Corporation issued a notice inviting applications for appointments to class II Junior posts of (a) assistant/divisional statisticians and (b) labour welfare officers on a pay of Rupees 220/- per month in the pay scale of Rupees 220-15-400-EB-20-500 plus the usual dearness and other allowances admissible under the Rules. On August 11, 1964, the respondent filed a writ petition in the High Court at Mysore claiming that the Corporation had no power to issue the notice and praying for an order quashing it. The High Court allowed the petition and quashed the notice. The Corporation has filed this appeal by special leave. For the proper appreciation of the point in issue, it is necessary to read Ss. 14, 19 (1) (a), 19 (1) (b) 19 (1) (c), 34, 45 (1) and 45 (2) (c) of the Road Transport Corporations Act, 1950 (Act No. 64 of 1950) :
"14. (1) Every Corporation shall have a Chief Executive Officer or General Manager and a Chief Accounts Officer appointed by the State Government.
(2) A Corporation may appoint such other officers and servants as it consider necessary for the efficient performance of its functions.
(3) The conditions of appointment and service and the scales of pay of the officers and servants of a Corporation shall-
(a) as respects the Chief Executive Officer or General Manager and the Chief Accounts Officer be such as may be prescribed, and
(b) as respects the other officers and servants be such as may, subject to the provisions of Section 34, be determined by regulations made under this Act.
19 (1) Subject to the provisions of this Act, a Corporation shall have power-
(a) to operate road transport services in the State and in any extended area
(b) to provide for any ancillary service;
(c) to provide for its employees suitable conditions of service including fair wages, establishment of provident fund, living accommodation, places for rest and recreation and other amenities.
34 (1) The State Government may, after consultation with a Corporation established by such Government, give to the Corporation general instructions to be followed by the Corporation, and such instructions may include directions relating to the recruitment, conditions of service and training of its employees, wages to be paid to the employees, reserves to be maintained by it and disposal of its profits or stocks.
2. In the exercise of its powers and performance of its duties under this Act, the Corporation shall not depart from any general instructions issued under sub-section (1) except with the previous permission of the State Government.
45 (1) A Corporation may, with the previous sanction of the State Government, make regulations, not inconsistent with this Act and the rules made "thereunder, for the administration of the affairs of the Corporation.
(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely:-
* * * * * *
(c) the conditions of appointment and service and the scales of pay of officers and servants of the Corporation other than the Chief Executive Officer or General Manager and the Chief Accounts Officer,"
(2) Admittedly, no regulations were framed by the Corporation under S. 45 (2) (c) prescribing the conditions of appointment and service add the scales of pay of its officers and servants. In the affidavit filed on behalf of the Corporation, it was stated that the Corporation was taking necessary steps for the framing of the regulations. The High Court following its earlier decision in Karnakar Mangesh Desai v. State of Mysore , (1966) 1 Mys LJ 72: held that until regulations were framed by the Corporation under Section 45 (2) (c) with the previous sanction of the State Gove
