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2019 Supreme(SC) 224
SUPREME COURT OF INDIA
Abhay Manohar Sapre, Indu Malhotra, JJ.
Fed. of Bank of India Staff Unions & Anr. – Appellant(s)
VERSUS
Union of India & Anr. – Respondent(s)
Civil Appeal No. 5570 of 2014
Decided on : 01-03-2019
For the Appellant :Mr. Siddharth Bhatnagar, Advocate and Mr. T. Mahipal, Advocate
For the Respondent:Mr. Pranab Kumar Mullick, Advocate, Ms. Soma Mullick, Advocate, Mr. Sebat Kumar Deuria, Advocate, Ms. Bhakti Pasrija, Advocate, Mr. T.M.Singh, Advocate Mr. Hemant Arya,Advocate Ms. Kirti Duya,Advocate, Ms. Tanisha Samanta, Advocate, Ms. Snidha, Advocate, Ms. Saudamini, Advocate, Mr. Sumit, Advocate For Mrs. Anil Katiyar, Advocate.
IMPORTANT POINT
Qualifications and disqualifications are bound to vary from category to category and would depend on post, experience and stream from where a person is being nominated as a Director.
Headnote:(A) Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980 – Section 9(3)(e) & (f) – Nationalized Banks (Management and Miscellaneous provisions) Scheme, 1970 – Clause 3(2)(i), (ii) & (iii) – Nomination of Director of Company from workman/employee category – Disqualification – Parameters vis-à-vis different category of Directors – It is for Legislature to decide as to what qualifications and disqualifications should be prescribed for various categories of employees for their nomination on post of Director – There lies distinction between worker and officer – Worker is governed by Industrial Disputes Act, 1947 whereas officer is not governed by Industrial Disputes Act but is governed by separate service rules – Both these categories of employees cannot be equated with each other and nor can be placed at par for providing equal qualification or/and disqualification for their nomination as a Director in Board of Directors – Article 14 of Constitution applies inter se two equals and not inter se unequals – Case at hand falls under latter category and reliance placed on principle enshrined under Article 14 of Constitution by appellants is wholly misplaced – Nominee worker/employee has only a right under Act to be appointed as Director from category of worker/employee in terms of Section 9 (3)(e) of the Act provided concerned nominee whose name is recommended by Union fulfills qualifications laid down in Clause 3(2)(iii) of Scheme but not beyond it. (Paras 29 and 31)
(B) Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980 – Section 9(3)(e) & (f) – Nationalized Banks (Management and Miscellaneous provisions) Scheme, 1970 – Clause 3(2)(i), (ii) & (iii) – Nomination of Director of Company from workman/employee category – Disqualification – Parameters vis-à-vis different category of Directors – Board of Directors consists of persons coming from different fields – There cannot be a uniform qualification or/and disqualification for such persons – Qualifications and disqualifications are bound to vary from category to category and would depend on post, experience and stream from where a person is being nominated as a Director – Qualification and disqualification has to be seen prior to his/her becoming a Director and not after appointment as a Director – No good ground to interfere with reasoning and conclusion arrived at by High Court which rightly dismissed appellants’ writ petition and upheld Clause 3(2)(iii) of Scheme as being legal – Appeals dismissed. (Paras 32 and 33)
Facts of Case:
Case at hand relates to nomination of a Director from workman/employee category falling in clause (e) of Section 9(3) of Act and also relates to his disqualification for being nominated as a Director in that category. Present appeal is directed against final judgment and order dated 08.04.2011 passed by High Court of Bombay at Goa in Writ Petition (c) No.618 of 2010 whereby High Court
dismissed writ petition filed by appellants.
Findings of Court:
Mere reading of Section 9(3) clause (a) to (i) would go to show that Board of Directors consists of persons coming from different fields. There cannot, therefore, be a uniform qualification or/and
disqualification for such persons. Indeed, qualifications and disqualifications are bound to vary from category to category and would depend on the post, experience and the stream from where a
person is being nominated as a Director. Moreover, qualification and disqualification has to be seen prior to his/her becoming a Director and not after his/her appointment as a Director.
Result : Appeal dismissed.
JUDGMENT
Abhay Manohar Sapre, J.
This appeal is directed against the final judgment and order dated 08.04.2011 passed by the High Court of Bombay at Goa in Writ Petition (c) No. 618 of 2010 whereby the High Court dismissed the writ petition filed by the appellants herein.
2. The appeal involves a short point as would be clear from the facts stated infra.
3. The appellants herein are the writ petitioners and the respondents herein are the respondents in the writ petition filed in the High Court of Bombay at Goa, out of which this appeal arises.
4. Appellant No.1 is an Association of various Staff Unions of the employees working in the Bank of India - respondent No. 2 herein. Appellant No.1 is a registered Association under the Trade Unions Act, 1926. Appellant No. 2 is an employee of Respondent No. 2 - Bank and at the relevant time was working as Deputy General Secretary of appellant No. 1- Association.
5. The Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980 (hereinafter referred to as "the Act") deals with Banking Companies and their internal affairs. Section 9 of the Act empowers the Central Government to make scheme after consultation with the Reserve Bank of India for carrying out the provisions of the Act.
6. Section 9 (3) of the Act provides for composition of Board of Directors and also provides as to who can be nominated as Directors in the Board of Directors. Clauses (a) to (i) of sub-section (3) of Section 9 of the Act sets out various categories from which one Director from each of such categories is nominated in the Board of Directors. Clause(e) deals with a category of workman/ employee Director whereas clause (f) deals with a category of officer/employee Director for their nomination in the Board of Directors.
7. In exercise of powers conferred under Section 9(1) of the Act, the Central Government has framed a Scheme called-The Nationalized Banks (Management and Miscellaneous provisions) Scheme, 1970.
8. Chapter II of the Scheme deals with Board of Directors. Clause 3 of the Scheme deals with the constitution of the Board whereas Clause 3(2)(iii) deals with disqualification of a workman/employee for being nominated as a Director.
9. So far as the procedure relating to the nomination of a Director out of the officer/employee category falling in clause(f) of Section 9(3) of the Act is concerned, it is provided in the third schedule to the Scheme.
10. So far as the case at hand is concerned, it relates to the nomination of a Director from the workman/ employee category falling in clause (e) of Section 9(3) of the Act and also relates to his disqualification for being nominated as a Director in that category.
11. On 28.05.2009, the Management of the Bank (respondent No. 2) called upon the appellants to furnish a panel of three workers/employees for being nominated as a Director in order of preference in the category of "Workman Director" in the Board of Directors.
12. The appellants, in compliance with the request made by respondent No. 2, sent a panel of three names of the workers/employees in order of preference to the Central Government by their letter dated 08.06.2009. These names were - Mr. Dinesh Jha "Lallan", Mr. Ram Gopal Sharma and Mr. Pranab Kumar Roy Chowdhary.
13. The Secretary, Government of India, by letter dated 10.10.2009, however, informed the appellants that since all the three workers/employees, whose names were sent, have less than three years of residual service before their superannuation, therefore it is not possible to nominate any of the workers/employees as Director in the Board of Directors. The appellants were accordingly requested to send a fresh panel of names to enable the Central Government to nominate one, out of the three new names, as Director in the Board of Directors.
14. The appellants instead of sending the fresh three names submitted their representation on 21.10.2009 and requested the Central Government to re-consider the matter afresh and nominate any one out of th
