1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE SIDE WRIT PETITION NO.2373 OF 2008 Municipal Corporation of Greater Mumbai & Ors. ...Petitioners. Vs. Smt.Malen C. Perira & Ors. ...Respondents. .... Mr. A.Y. Sakhare, Senior Advocate with Mr. A.J. Bhor i/b. Mr. S.H. Ujjainwala for the Petitioners. Mr. R.D. Bhat for Respondent No.1. Mr. M.S. Oberoi i/b. Mrs. N.V. Sanglikar for Respondent No.2. ..... CORAM :DR.D.Y.CHANDRACHUD, J. June 27, 2008. ORAL JUDGMENT: Rule, by consent of Counsel returnable forthwith. Counsel appearing on behalf of the Respondents waive service. By consent of Counsel and at their request taken up for hearing and final disposal. The Municipal Corporation of Greater Mumbai has instituted proceedings under Articles 226 and 227 of the Constitution of India, in order to challenge the judgment of the Industrial Court in a complaint of unfair labour practices under the Maharashtra 2 Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971. 2. The First Respondent was the complainant in a complaint of unfair labour practices instituted before the Industrial Court. The relief that was sought by the First Respondent was a direction to the Municipal Corporation to promote her as a Matron at the KEM Hospital with effect from 1st January 2004 when the post had fallen vacant. 3. In pursuance of the duty cast upon the Municipal Corporation under Section 61(gg) of the Mumbai Municipal Corporation Act, 1888, the Municipal Corporation has established three major Hospitals, namely, (i) KEM Hospital, (ii) Nair Hospital and (iii) LTMG Hospital. There is a post of Matron on the establishment of each of these Hospitals. The post of Matron at the KEM Hospital fell vacant in December 2003 while that at the LTMG Hospital fell vacant in January 2004. The case of the First Respondent was that she had 3 joined service with the Municipal Corporation in 1976 as a Staff Nurse and was appointed as a Sister Tutor in August 1983. Prior to 1998, the qualifications required for the post of a Matron were those that held the field in pursuance of a Resolution passed by the Municipal Corporation on 2nd February 1984. The grievance of the First Respondent is that these qualifications which were prescribed in pursuance of the statutory powers conferred upon the appropriate authority for framing Regulations were sought to be revised in 1998 retrospectively without recourse to the Standing Committee or the Municipal Corporation, by an administrative fiat of the Municipal Commissioner. 4. In order to appreciate the grievance of the First Respondent, it would be necessary to make a reference to the qualifications as they stood for the appointment of a Matron under the Resolution passed by the Municipal Corporation, C.R. 209 of 2nd February 1984. The qualifications were to the following effect : 4 “Matron By Promotion. (A) Appointment to the post shall be made either: By Promotion of a suitable candidate in the Municipal Corporation of Greater Bombay possessing the qualification and experience prescribed for the appointment by selection. (B) By selection from among candidates who:- (I) Unless already in the service of the Municipal Corporation of Greater Bombay are not more than 35 years of age. (II) a - are trained in General Nursing & Midwifery & are registered as Nurse & Midwife, with the Maharashtra Nursing Council or b - possess a Bachelor's of higher degree in Nursing of an Institution, and (III) have held the post of an Assistant Matron or sister tutor in any of the General Hospitals to which a Nurse Training School is attached for five years after graduation in the case of candidates possessing degree in Nursing & for seven years after qualifying in the case of others. Provided that preference will be given to candidates possessing a certificate passing the Sister Tutor's course or a course in Nursing Administration. Provided further that the age limit may be relaxed in favour of candidates possessing exceptional qualification or experience or both. Provided further that, if at any stage of selection, the Maharashtra Public Service Commission is of the opinion that sufficient number of candidates possessing the prescribed period of experience are not available to fill up 5 the vacancies reserved for candidates belonging to Scheduled Caste, Scheduled Caste converts to Buddhism, Scheduled Tribe, Denotified Tribe or, Nomadic Tribe, then the Commission may, in the matter of such selection, relax the requirement in respect of experience set out in sub- clause (iii) of clause (b) of Rule 2 & select suitable candidates belonging to such castes or tribes.” 5. In the present case, the Court is essentially concerned with appointments by promotion. The Regulations prescribe that an inservice candidate must possess the qualifications and experience prescribed for appointment by selection. For an appointment by selection, the qualifications required are Training in General Nursing and Midwifery and registration as a Nurse and Midwife with the Maharashtra Nursing Council or a Bachelor's or higher degree in Nursing, of an Institution. Moreover, the candidate must have held the post of Assistant Matron or Sister Tutor in any of the General Hospitals to which a Nurse Training School is attached for five years after graduation in the case of a candidate possessing a degree in Nursing and seven years after qualifying in the case of others. 6 6. The contention of the Municipal Corporation is that prior to 1998, the posts of Matron were filled in from amongst employees in the cadre of Sister Tutor and Assistant Matron by promotion. The incumbent in the post of Matron had to shoulder a dual responsibility both towards the Hospital administration as well as in the Nurse Training Schools which were attached to the Hospital. The Municipal Corporation stated that in 1997, a post of Principal in the Nurse Training School was created in each of the three major Hospitals and the work of the Matron was bifurcated between the Matron who looks after Hospital administration and the Principal for the Nurse Training School. The post of Principal was decided to be filled in from the Cadre of Sister Tutor. In view thereof, according to the Corporation, two separate promotional channels were created, one for the post of Principal and the other for the post of Matron. According to the Corporation, revised qualifications were prescribed for promotion to the post of Matron and the requirements for appointment by promotion were to the following effect: “BY PROMOTION: 7 (a) B.Sc. degree of the recognized University in Nursing (Basic or post Basic). (b) Has held the post of Sr.Asstt. Matron at least for a period of 5 years after graduation in any of the Municipal General Hospital to which Nursing Training School is attached. (c ) Possesses adequate knowledge of Marathi so as to read, write and speak with facility.” The contention of the Municipal Corporation was that in view of the revised qualifications which came into effect in 1998, the Fourth Respondent was not entitled to be promoted to the post of Matron since the post of Matron could thereafter be filled in only from the cadre of Senior Assistant Matron and not from the cadre of Sister Tutor. Accordingly, the First Respondent was sought to be informed by a letter dated 5th January 2004. 7. The Industrial Court allowed the complaint of unfair labour practices by its judgment dated 12th February 2008 and while issuing a declaration of the commission of unfair labour practices under Items 8 5 and 9 of Schedule IV directed the Municipal Corporation to consider the First Respondent for promotion to the post of Matron in either of the three major Municipal Hospitals and to grant her all consequential monetary benefits. 8. The essential issue upon which the decision of the Industrial Court and the outcome of these proceedings would rest is as to whether the revised qualifications that were prescribed in 1998 have the force of law and have been validly issued in supersession of the Regulations which held the field. In order to appreciate the submissions which have been urged on either side, to which a reference would be made shortly hereafter, it would be necessary for the Court to advert to the relevant provisions of the Mumbai Municipal Corporation Act, 1888. Section 4 contains a description of the Municipal Authorities which are charged with carrying out the provisions of the Act, among them being the Corporation, the Standing Committee and the Municipal Commissioner. Section 64(1) provides that the respective functions inter alia of the Municipal 9 Authorities shall be such as are specifically prescribed in or under the Act. Under sub-section (3) of Section 64, all the executive powers for carrying out the provisions of the Act vest in the Municipal Commissioner. Clauses (a), (b) and (e ) of sub-section (3) of Section 64 are relevant for the purposes of the present case and are as follows : “(3) Subject, whenever it is in this Act expressly so directed, to the approval or sanction of the Corporation or the Standing Committee or the Improvements Committee, or the Education Committee and subject also to all other restrictions, limitations and conditions imposed by this Act, the entire executive power for the purpose for the purpose of carrying out the provisions of this act vests in the Commissioner, who shall also - (a) perform all the duties and exercise all the powers specifically imposed or are conferred upon him by this Act; (b) prescribe the duties of, and exercise supervision and control over, the acts and proceedings of all municipal officers and servants immediately subordinate to him and subject to regulations at the time being in force under Section 81 dispose of all questions relating to the service of the said officers and servants and their pay, privileges and allowances; ... 10 (e) be responsible for implementing the decision of the Corporation, the Standing Committee, the Improvements Committee, the Brihan Mumbai Electric Supply and Transport Committee and the Education Committee.: Section 67 imposes a restriction on the exercise by a Municipal Authority of any power conferred or the performance of any duty involving an outlay of expenditure. Under Section 79, the Commissioner has to prepare and bring before the Standing Committee a schedule setting forth the designations and grades of the other officers and servants (other than those under Section 61(q)) who should, in his opinion, be maintained together with the salaries and allowances proposed to be paid. Sub-section (1) of Section 80A stipulates that the power of appointing Municipal officers to posts which rank equivalent to, or higher than, the post of Executive Engineer shall vest in the Corporation. Under sub-section (2) of Section 80A, the power of appointing municipal officers and servants other than those of the rank of Executive Engineer and above is to vest in the Municipal Commissioner. Section 80B inter alia provides 11 that where the power of appointment to a post vests in the Corporation or a Standing Committee and which is equivalent to, or higher than, the post of Executive Engineer, no appointment shall be made except after consultation with the Maharashtra Public Service Commission. Finally, it would be necessary to refer to Section 81 under which a Standing Committee is empowered to frame regulations. Section 81 provides as follows: “81. (1) The Standing Committee shall from time to time frame regulations in consonance with any resolution that may be passed by the corporation- (a) fixing the amount and the nature of the security to be furnished by any municipal officer or servant from whom it may be deemed expedient to require security; (b) regulating the grant of leave to municipal officers and servants; (c ) authorizing the payment of allowances to the said officers and servants or to certain of them, whilst absent on leave; (d) determining the remuneration to be paid to the persons appointed to act for any of the said officers or servants during their absence on leave; (dd) authorizing the payment of travelling or conveyance allowance to the said officers and servants; 12 (e) regulating the period of service of all the said officers and servants; (f) determining the conditions under which the said officers and servants, or any of them, shall on retirement or discharge receive pensions, gratuities or compassionate allowances and under which the surviving spouse or children and in the absence of the surviving spouse or children the parents, brothers and sisters, if any, dependent on any of the said officers and servants, shall, after their death, receive compassionate allowances and the amounts of such pensions, gratuities or compassionate allowances; (g) authorizing the payment of contributions, at certain prescribed rates and subject to certain prescribed conditions, to any pension of provident fund which may, with the approval of the Standing Committee, be established by the said officers and servants or to such provident fund, if any, as may be established by the corporation for the benefit of the said offices and servants; (h) in general, prescribing any other conditions of service of the said officers and servants. (2) No regulation made by the Standing Committee under this section shall have force or validity, unless and until it has been confirmed by the corporation, nor, if it is made under clause (f), unless and until it has been confirmed by the State Government.” 9. On 2nd February 1984, the Municipal Corporation framed 13 Regulations prescribing the qualifications and experience required for appointment to the post of Matron together with several other posts in the Nursing category. These regulations are referable to the power conferred by Section 81 of the Act. Under clause (h) of sub-section (1) of Section 81, the Standing Committee is empowered to prescribe the other conditions of service of the municipal officers and servants and under sub-section (2), the regulations made by the Standing Committee have to be confirmed by the Municipal Corporation. The Resolution of the Municipal Corporation is CR 209 of 2nd February 1984. 10. Now, it is an admitted position that in the year 1998, what was sought to be done was to bring about a change in the qualifications for appointment to the post of Matron. Counsel appearing on behalf of the Municipal Corporation has relied upon a compilation of documents. The compilation of documents contains a file note of 19th May 1997 which reflects that at that point of time, the post of Matron was to be filled in from amongst the common seniority 14 of Sister Tutors and Senior Assistant Matrons. It was proposed that the post of Matron should be filled in purely from amongst Senior Assistant Matrons who were exposed to ward work and hospital administration. The creation of one post of Principal in each of the major Hospitals, namely, KEM, Nair and Sion was proposed and a common seniority of Sister Tutors for all the three Hospitals was also proposed. Promotion to the post of Principal, it was proposed, would be made from the common seniority of Sister Tutors. A decision was taken to refer the proposal to a Committee constituted by the Municipal Commissioner for consideration. On 9th October 1997, the Committee constituted for creation of temporary posts, accorded sanction to the creation of additional temporary posts of three Principals – one each for the KEM, Sion and Nair Hospitals so as to have two separate wings, a teaching wing and a non-teaching wing on the establishment of each hospital. The Committee accorded sanction to filling up these posts from the common seniority of Sister Tutors of the three major Hospitals subject to the fulfilling of the prescribed qualifications. Finally reliance has been placed on a 15 decision taken on a proposal dated 23rd February 1998. The proposal noted that under the provisions of the Mumbai Municipal Corporation Act, 1888, the permission of the Municipal Corporation or, as the case may be, of the Maharashtra Public Service Commission was required for prescribing qualifications only to the posts of Executive Engineer and above. Since the post of Matron was below the prescribed pay scale for the post of Executive Engineer, it was suggested that the power to prescribe qualifications, or to modify the existing qualifications fell within the power of the Municipal Commissioner. In pursuance of the aforesaid proposal, a decision was then taken to revise the qualifications for the post of Matron. 11. The effect of the revised qualifications is that only a Senior Assistant Matron is eligible for promotion to the post of Matron. Learned Senior Counsel appearing on behalf of the Municipal Corporation fairly did not dispute the position that the earlier qualifications which were prescribed in the year 1984 were laid down in pursuance of the power conferred upon the Competent Authority to 16 frame regulations under Section 81 of the Mumbai Municipal Corporation Act, 1888. However, it was submitted that Section 80A and Section 80B of the Act were amended by Maharashtra Act 33 of 1989 and the consequence thereof was that the power of appointing Municipal Officers to posts which rank equivalent to or higher than the Executive Engineer, vests in the Corporation. The power to make appointment both to temporary and permanent posts for all other Municipal Officers and servants vests in the Municipal Commissioner. Hence it was urged that after the amendment of 1989, the appointing authority to the post of Matron, which ranks below the pay scale of Executive Engineer, is the Municipal Commissioner and, that as a result, it is for the Municipal Commissioner to frame or modify the Regulations pertaining to the conditions of service and eligibility for appointment to the post of Matron. 12. The submission cannot be accepted. The Standing Committee is vested with the power to frame regulations, in consonance with any resolution that may be passed by the Municipal 17 Corporation for prescribing conditions of service of Municipal Officers and servants. Clauses (a) to (g) of sub-section (1) of Section 81 extend the power to frame regulations to certain specified areas including the grant of leave, payment of allowances, the period of service, terminal benefits and the payment of contributions to Pension or Provident Fund. Clause (h) of sub-section (1) of Section 81 is a residuary provision which empowers the Standing Committee to frame regulations in general prescribing any other conditions of service of the said officers and servants. The expression “any other conditions of service” would refer to all conditions of service other than those which are specifically referred to in clauses (a) to (g). Reference to the “said officers and servants” would mean officers and servants referred to in the earlier part of sub-section (1). In clause (a) of sub-section (1) of Section 81, there is a reference to “any Municipal officer or servant”. The power, therefore, to frame regulations governing the conditions of service of Municipal Officers and servants is vested in the Standing Committee. Under sub-section (2), a regulation framed by the Standing Committee has to be confirmed by 18 the Municipal Corporation. (A Regulation under clause (f) has to be confirmed by the State Government before it becomes valid. Clause (f) deals with retiral or terminal benefits). 13. The Municipal Commissioner is vested with executive powers for the purpose of carrying out the provisions of the Act. Sub- section (3) of Section 64, while conferring executive powers on the Municipal Commissioner, expressly subjects them to all other restrictions, limitations and conditions imposed by the Act. Clause (b) of sub-section (3) of Section 64 empowers the Municipal Commissioner to prescribe the duties of, and exercise supervision and control over, the acts and proceedings of all municipal officers and servants. The Municipal Commissioner is entitled to dispose of all questions relating to service of the municipal officers and servants and their pay, privileges and allowances, subject to the Regulations for the time being in force under Section 81. The Municipal Commissioner, when he exercises executive powers is subject to the restrictions, limitations and conditions imposed by the Act and to 19 the provisions contained in Regulations framed under Section 81, where regulations governing a particular subject matter hold the field. The Municipal Commissioner is entitled to issue administrative directions or circulars to implement the Regulations or to act in furtherance of the Regulations that have been framed by the Standing Committee and approved by the Municipal Corporation. Similarly, where no regulations hold the field, it is open to the Municipal Commissioner to exercise his executive powers in areas which are not dealt with. This is in consonance with the basic principle of law that all executive powers are in aid of the implementation of Regulations made under a statute. The executive power can fill in the gap in areas which are not regulated by Regulations having the force of statute or delegated legislation. The provisions of clause (b) of sub-section (3) of Section 64 statutorily recognize that the power of the Municipal Commissioner is subject to the regulations which hold the field for the time being in force. By the amendment which was made to Sections 80A and 80B, the power of appointment of municipal officers and servants above the post of Executive Engineer, 20 is vested in the Municipal Corporation and below the said post with the Municipal Commissioner. The power to frame regulations to prescribe the conditions of service is, however, expressly a power which is conferred upon the Standing Committee. The power of appointment has to be exercised in a manner which is in consonance with the Regulations, when Regulations prescribing conditions of eligibility, experience and qualifications have been made in accordance with the provisions of Section 81. 14. This position in law is set out in two judgments of Division Benches of this Court. The first judgment in Municipal Corporation of Greater Bombay vs. Miss S.R. Dethe,1 involved a challenge to the second proviso to Regulation 67 of the Municipal Services Regulations under which the Competent Authority was empowered to retire municipal servants upon the attainment of the age of 55 years. The proviso was upheld in the judgment of the Division Bench. The judgment also dealt with a challenge to a circular issued by the 1 1970 (73) BLR738 21 Deputy Municipal Commissioner on 15th June 1967 in which it was spelt out that Heads of Departments must ensure that “only fit persons” were continued beyond the age of fifty five. The Division Bench held that the circular which was issued by the Municipal Commissioner was consistent with his power under which the entire executive authority of the Corporation vested in him. The Division Bench held that executive instructions must, however, be within the framework of rules and regulations made by the Corporation and so long as that was done, administrative instructions would remain valid. The Division Bench held as follows : “By virtue of these provisions, the Commissioner would be entitled to issue instructions to the Municipal officers and servants and those instructions would bind them. Such instructions must, undoubtedly, be within the framework of the rules and regulations made by the Corporation, but so long as the Commissioner acts within that frame-work the instructions issued by him would have binding authority.” (emphasis supplied). The Division Bench noted that the circular which was issued by the 22 Deputy Municipal Commissioner was in furtherance of Regulations framed by the Corporation : “In our opinion, therefore, the Circular issued on the authority of the Commissioner being in furtherance of the Regulation framed by the Corporation and not in derogation of it, is within the competence of the Commissioner and it must therefore bind all subordinate officers and servants who are amenable to the jurisdiction of the Commissioner.” In a subsequent decision in Damodar Shantaram Nadkarni vs S.E. Sukhtankar,2 a Division Bench of this Court noted that the effect of Section 64(3) was that the entire residuary executive power for carrying out the provisions of the Act was vested with the Municipal Commissioner, save and except where it was otherwise provided. The Bench noted that the Municipal Commissioner was clothed with a power to prescribe duties and exercise supervision and control