Case: Rajesh Awasthi Vs. Nand Lal Jaiswal

K.S. RADHAKRISHNAN, J. 1. Leave granted. 2. We are, in this case, concerned with the question whether the High Court was justified in issuing a writ of quo warranto holding that the appellant has no authority in continuing as Chairperson of U.P. State Electricity Regulatory Commission (for short ‘the Commission’) on the ground that the Selection Committee had not complied with sub-section (5) of Section 85 of the Electricity Act, 2003 (for short ‘the Act’). 3. The post of the Chairperson of the Commission fell vacant on 21.10.2008. The government of Uttar Pradesh, in exercise of its powers conferred under Section 85(1) of the Act, constituted a Selection Committee vide notification dated 22.12.2008 consisting of three members headed by a retired judge of the High Court and two other members i.e. Chief Secretary of the State of U.P. and Chairman of the Central Electricity Commission for finalizing the selection of the Chairperson. Applications were invited intimating various authorities including Ministry of GOI, CAG, CEA, all the Secretaries of Power working in different States in the country, CBDT, PSUs power sectors etc. Thirty persons applied for the post including the appellant. The meeting of the Selection Committee was held on 26.12.2008 and Selection Committee selected two persons on merit, namely, the appellant and one Mr. Amit Kumar Asthana. Panel of two names was forwarded by the Selection Committee to the government of U.P. with an asterisk against the name of the appellant stating that if he was appointed, the government would ensure first that the provisions of sub-section (5) of Section 85 of the Act would be complied with. The government appointed the appellant as the Chairman of the Commission on 29.12.2008. The appellant on that date sent a letter to the State Government stating that he had resigned from his previous assignments on 27.12.2008 and severed all his links with the private sector as required under Section 85 of the Act.4. The first respondent herein who was the General Secretary, Jal Vidyut Unit, filed a writ petition before the High Court of Allahabad, Lucknow Bench seeking a writ of quo warranto, challenging the appointment of the appellant on various grounds. Apart from the contention that the Selection Committee had not followed the provisions contained in sub-section (5) of Section 85 of the Act, it was also alleged that the appellant could not have been selected since he was working as the Joint President of the J.P. Power Ventures Ltd at the time of selection, hence he had financial and other interests in that company which would prejudicially affect his functions as the Chairperson of the Commission. Further, it was also pointed out that the procedure laid down in U.P. Electricity Regulatory Commission (Appointment and Conditions of Service of the Chairperson and Members) Rules, 1999 (for short ‘the 1999 Rules’) were also not complied with before initiating the selection process. The appellant questioned the locus standi of the first respondent and contended that he was not an aspirant for the post and that the writ petition was filed after a period of more than two years after his assumption of charge as Chairperson of the Commission. Referring to the minutes of the Selection Committee dated 26.12.2008, it was pointed out that the selection was validly made and the appellant was ranked first in panel on merit and sub-section (5) of Section 85 was also complied with. Further, it was stated that the appellant had no financial or other interests in J.P. Power Venture Ltd. so as to prejudicially affect his functions as Chairperson. In any view, it was pointed out that he had resigned from that post on 27.12.2008.5. The High Court after considering the rival contentions came to the conclusion that the Selection Committee had failed to follow the provisions of sub-section (5) of Section 85 of the Act, hence the appointment was vitiated and the appellant had no authority to hold the post of Chairperson. Further, it was also found that the Selection Committee had no power to delegate the powers conferred on it under Section 85(5) of the Act to the State Government. The court also held that the first respondent had sufficient locus standi to move the writ petition and the delay in approaching the court was not a ground, since a person who had been appointed contrary to a statutory provisions had no legal right to hold on to that post. The High Court, therefore, allowed the writ petition, issued a writ of quo warranto and quashed the appointment of the appellant declaring the same as illegal and void.6. Shri L. Nageswara Rao, learned senior counsel appearing for the appellant submitted that the High Court has committed an error in holding that the appointment of the appellant was in violation of sub-section (5) of Section 85 of the Act. Learned senior counsel took us through the minutes of the Committee meeting held on 26.12.2008 and pointed out that the Selection Committee, after examination of the bio-data of 30 candidates, prepared a panel in which the appellant’s name was shown as first in the order of merit. The Selection Committee, according to learned counsel, was very much aware of the fact that the appellant was the joint Vice President of J.P. Power Venture Ltd. and hence had put an asterisk against his name and reminded the State Government that if he was to be appointed, the provisions of sub-section (5) of Section 85 of the Act be first ensured. Learned senior counsel, therefore, submitted that there was substantial compliance of that provision and in any view it is only a curable defect, procedural in nature and a writ of quo warranto be not issued, being a discretionary remedy. Referring to the judgment of this Court in University of Mysore & Anr. v. C.D. Govinda Rao & Anr. (1964) 4 SCR 575 , learned senior counsel submitted that the suitability arrived at by the Committee is not a matter amenable to proceedings under quo warranto. Learned senior counsel also referred to the judgments of this Court in Mahesh Chandra Gupta vs. Union of India (2009) 8 SCC 273 , Hari Bansh Lal v. Sahodar Prasad Maht and others (2010) 9 SCC 655 . 7. Learned senior counsel submitted that, in any view of the matter, writ of quo warranto will not lie where the breach in question is curable, hence procedural in nature. Assuming there is non-compliance of sub-section (5) of Section 85 of the Act, the matter can be relegated back to Selection Committee for due compliance of that provision. Learned senior counsel also submitted that the writ of quo warranto is a discretionary remedy and hence such a course can be adopted by this Court. Reference was also made to the judgment of this Court in B. Srinivasa Reddy v. Karnataka Urban Water Supply & Drainage Board Employees Associaition (2006) 11 SCC 731 . 8. Mr. Prashant Bhushan, learned counsel appearing for the first respondent submitted that the High Court has rightly issued the writ of quo warranto after having found that the appointment was made in gross violation of sub-section (5) of Section 85 of the Act. Learned counsel submitted that even the procedure laid down in 1999 Rules was also not complied with. Learned counsel referring to the bio-data of the applicants for the post of Chairperson tried to make a comparison of the merit of other candidates and submitted that many of the candidates who had applied were far superior to the appellant. Learned counsel also submitted that the appellant was appointed due to extraneous reasons and the merit was not properly assessed, leave aside, the non-compliance of sub-section (5) of Section 85 of the Act and 1999 Rules. Learned counsel also pointed out that since the appellant was Joint President of the J.P. Power Venture Ltd. - a private company at the time of selection, he was disqualified in occupying the post of Chairperson since he had financial and other interest which would prejudicially affect his functions as Chairperson. Mr. Ravindra Shrivastava, learned senior counsel appearing for the state of U.P. submitted that the appointment of the appellant was in violation of sub-section(5) of Section 85 of the Act and the 1999 Rules and the State is taking steps to conduct fresh selection after complying with the provisions of the Act and 2008 Rules, which is in force.9. We heard learned counsel appearing on either side. The locus standi of the first respondent or the delay in approaching the writ court seeking a writ of quo warranto was not seriously questioned or urged before us. The entire argument centered around the question whether there was due compliance of the provisions of sub-section (5) of Section 85 of the Act. Section 85 is given for ready reference: “SECTION 85: Constitution of Selection Committee to select Member of the State Commission :(1) The State Government shall, for the purposes of selecting the Members of the State Commission, constitute a Selection Committee consisting of –(a) a person who has been a Judge of the High Court… . Chairperson;(b) the Chief Secretary of the concerned State… .Member;(c) the Chairperson of the Authority or the Chairperson of the Central Commission … … … … .. Member:Provided that nothing contained in this section shall apply to the appointment of a person as the Chairperson who is or has been a Judge of the High Court.(2) The State Government shall, within one month from the date of occurrence of any vacancy by reason of death, resignation or removal of the Chairperson or a Member and six months before the superannuation or end of tenure of the Chairperson or Member, make a reference to the Selection Committee for filling up of the vacancy.(3) The Selection Committee shall finalise the selection of the Chairperson and Members within three month from the date on which the reference is made to it.(4) The Selection Committee shall recommend a panel of two names for every vacancy referred to it.(5) Before recommending any person for appointment as the Chairperson or other Member of the State Commission, the Selection Committee shall satisfy itself that such person does not have any financial or other interest which is likely to affect prejudicially his functions as Chairperson or Member, as the case may be.(6) No appointment of Chairperson or other Member shall be invalid merely by reason of any vacancy in the Selection Committee.” 10. The Electricity Act, 2003 is an Act enacted to consolidate the laws relating to generation, transmission, distribution, trading and use of electricity and generally for taking measures conducive to development of electricity industry, promoting competition therein, protecting interest of consumers and supply of electricity to all areas, rationalization of electricity tariff etc. The Act also envisages the constitution of Central Electricity Authority, Regulatory Commission and establishment of Appellate Tribunal etc. The State Electricity Regulatory Commission (for short ‘the State Commission’) is constituted under sub-section (1) of Section 82 of the Act. Sub-section (5) of Section 85 of the Act states that the Chairperson and Members of the State Commission shall be appointed by the State Government on the recommendation of a Selection Committee as per Section 85 of the Act. Section 84 of the Act deals with the qualifications for appointment of Chairperson and Members of the State Commission which reads as follows: “84. Qualifications for appointment of Chairperson and Members of State Commission:(1) The Chairperson and the Members of the State Commission shall be persons of ability, integrity and standing who have adequate knowledge of, and have shown capacity in, dealing with problems relating to engineering, finance, commerce, economics, law or management.(2) Notwithstanding anything contained in sub-section (1), the State Government may appoint any person as the Chairperson from amongst persons who is, or has been, a Judge of a High Court.” 11. The Chairperson, therefore, shall be a person of ability, integrity and standing and has adequate knowledge of, and has shown capacity in, dealing with problems relating to engineering, finance, commerce, economics, law or management. The Selection Committee, as per Section 85, has to recommend a panel of two names for filling up the post of the Chairperson, but before recommending any person for appointment as the Chairperson, the Selection Committee has to satisfy itself that such person does have any financial or other interest which is likely to affect prejudicially his functions as Chairperson. The State Government under Section 82(5) of the Act has to appoint the Chairperson on the recommendation of the Selection Committee. 12. We have gone through the minutes of the Selection Committee meeting dated 26.12.2008 and also the bio-data of the applicants for the post of Chairperson of the State Commission. Reference to the bio data of some of the candidates is useful, hence given below: Bio-data of applicants for the post of Chairperson U.P.E.R.C. S.No. andDate ofEducationalQualification Retd.PostExperience nameBirthAcademicProfessionalspecial-FromHolding ization 1. S.K. Shukla1.1.1950BE (Mech.ME (Prod. Director33 years in Engg.Engg.) (Technical)T.H.D.C. Tehri Hydro Devpt. Corporation 3. Anil29.7.1952B. Tech.M.Tech Chief Engr.33 Years in Kumar (Electrical)(Power App. SystemCEA Trans- Asthana & Systems) planning &mission and Projectgrid opration 18. U.C. Misra31.7.1949B.E. Chairman4.5 Years (Electrical Bhakra BeasUPSEB, 15 Engg.) ManagementYears NHPC, Board16Years PGCIL, 2 Years Chairman BBMB 20. Rajesh19.1.1950Civil & Joint President3 Years Awasthi Municipal J.P. PowerCentral Engg. VenturesDesigns Graduate Organization Government of Maharashtra, 7.5 Years Machinery Co. Ltd., W.B., 24.5 Years NTPC, Joint President J.P. Power Ventures Ltd. from 17.11.2008 21. S.M.15.6.1949B.Sc.M.Sc. (Elec D.G. (Trg.36 Years UPSEB Agarwal (Elec.Engg.) & HRD)/UPPCL Engg.) UPPCL 24. Dr. Man1.8.1946B.E.M.E.Ph.D. Member29.5 Years in mohan (Elect.)(Power(Comm- (Technical)CEA, 3 Years System)ercial Avail- Gujarat ERCNTPC, 2 Years ability Index as Engr, Grade- of Power I, Govt. of Libya, Plant) 4 Years in Gujrat ERC. 13. Illustrative bio-data of some of the candidates would indicate their academic qualifications, professional experience including the area of specialization. Appellant’s qualification, experience and the fact that he was the Joint President of J.P. Power Ventures Ltd., was also indicated. The Selection Committee has put an asterisk against his name and then left it to the government to ensure the compliance of sub-section (5) of Section 85 of the Act. 14. We will examine the meaning and content of Section 85(5) and whether it calls for any interpretation. Lord Brougham in Crowford v. Spooner (1846) 6 Moore PC 1 has stated that “one has to take the words as the Legislature has given them, and to take the meaning which the words given naturally imply, unless where the construction of those words is, either by the preamble or by the context of the words in question controlled or altered”. Viscount Haldane in Attorney General v. Milne (1914-15) All England Report 1061 has held that the language used “has a natural meaning, we cannot depart from that meaning unless, reading the statute as a whole, the context directs us to do so”. Viscount Simon, L.C. in Nokes v. Dancaster Amalgamated Collieries Ltd. (1940) 3 All England Report 549 has held “the golden rule is that the words of a statute must prima facie be given their ordinary meaning”. Above principles have been repeated umpteen times by the House of Lords and this Court and hence, calls for no further elucidation. 15. We are clear in our mind about the language used in sub-section (5) of Section 85 of the Act, which calls for no interpretation. Words are crystal clear, unambiguous and when read literally, we have no doubt that the powers conferred under sub-section (5) of Section 85 of the Act has to be exercised by the Selection Committee and the Committee alone and not by the Government. Some of the words used in sub-section (5) of Section 85 are of considerable importance, hence, we give some emphasis to those words such as “before recommending”, “the Selection Committee shall satisfy” and “itself”. The Legislature has emphasized the fact that ‘the Selection Committee itself has to satisfy’, meaning thereby, it is not the satisfaction of the government what is envisaged in sub-section (5) of Section 85 of the Act, but the satisfaction of the Selection Committee. The question as to whether the persons who have been named in the panel have got any financial or other interest which is likely to affect prejudicially his functions as Chairperson, is a matter which depends upon the satisfaction of the Selection Committee and that satisfaction has to be arrived at before recommending any person for appointment as Chairperson to the State Government. The government could exercise its powers only after getting the recommendations of the Selection Committee after due compliance of sub-section (5) of Section 85 of the Act. The Selection Committee has given a complete go-by to that provision and entrusted that function to the State Government which is legally impermissible. The State Government also, without application of mind and overlooking that statutory provision, appointed the appellant. 16. A writ of quo warranto will lie when the appointment is made contrary to the statutory provisions. This Court in Mor Modern Coop. Transport Coop. Transport Society Ltd. v. Govt. of Haryana (2002) 6 SCC 269 held that a writ of quo warranto can be issued when appointment is contrary to the statutory provisions. In B. Srinivasa Reddy (supra), this Court has reiterated the legal position that the jurisdiction of the High Court to issue a writ of quo warranto is limited to one which can only be issued if the appointment is contrary to the statutory rules. The said position has been reiterated by this Court in Hari Bans Lal (supra) wherein this Court has held that for the issuance of writ of quo warranto, the High Court has to satisfy that the appointment is contrary to the statutory rules. 17. We are of the view that the principle laid down by this Court in the above-mentioned judgment squarely applies to the facts of this case. The appointment of the first respondent, in our considered view, is in clear violation of sub-section (5) of Section 85 of the Act. Consequently, he has no authority to hold the post of Chairperson of the U.P. State Electricity Regulatory Commission. 18. We express no opinion with regard to the contentions raised by the first respondent that the appellant had links with J.P. Power Ventures Ltd. According to the first respondent, the appellant had approved the higher tariff right to favour M/s J.P. Power Ventures Ltd., vide his order dated 27.8.2010. We have already found that the question as to whether, being Vice President of the J.P. Power, the appellant had any financial or other interest which would prejudicially affect his function as chairperson was an issue which the Selection Committee ought to have considered. We may point out that when the Selection Committee was constituted, 1999 Rules were in force and the present 2008 Rules came into force only on 1.1.2009. By virtue of Section 85 of the Act, the then existing Rules 1999 were also safeguarded. Section 3 of the 1999 Rules deals with the selection process for the post of Chairperson, which is almost pari-materia to the 2008 Rules. Sub-section (3) of Rule 3 is of some relevance, hence we extract the same: “3 (3) The convener shall sand requisition for the selection of any member for the aforesaid posts to different departments of State Governments and Central Govt., Public and Private Undertakings, Industrial Enterprises and to Organisation engaged in generation, distribution and supply of electricity, financial institutions, educational institutions and to the High Court and shall also invite applications directly from eligible persons by notifying the vacancy in the Government Gazette. The eligible persons may send their applications directly or through an officer or authority under whom he is for the time being working.” 19. The above-mentioned statutory requirements were also not followed in the instant case, over and above, the non-compliance of sub-section (5) of Section 85 of the Act. 20. We fully agree with the learned senior counsel for the appellant that suitability of a candidate for appointment does not fall within the realm of writ of quo warranto and there cannot be any quarrel with that legal proposition. Learned senior counsel also submitted that, assuming that the Selection Committee had not discharged its functions under sub-section (5) of Section 85 of the Act, it was only an omission which could be cured by giving a direction to the Selection Committee to comply with the requirement of sub-section (5) of Section 85 of the Act. Learned senior counsel submitted that since it is a curable irregularity, a writ of quo warranto be not issued since issuing of writ of quo warranto is within the discretion of the Court. Learned senior counsel made reference to the judgment of Court in R. v. Speyer (1916) 1 K.B. 595. 21. We are of the view that non-compliance of sub-section (5) of Section 85 of the Act is not a procedural violation, as it affects the very substratum of the appointment, being a mandatory requirement to be complied with, by the Selection Committee before recommending a person for the post of Chairperson. We are of the view that non-compliance of sub-section (5) of Section 85 of the Act will vitiate the entire selection process since it is intended to be followed before making the recommendation to the State Government. Non-compliance of mandatory requirements results in nullification of the process of selection unless it is shown that performance of that requirement was impossible or it could be statutorily waived. The expression “before recommending any person” clearly indicates that it is a mandatory requirement to be followed by the Selection Committee before recommending the name of any person for the post of Chairperson. The expression “before” clearly indicates the intention of the Legislature. The meaning of the expression “before” came for consideration before this Court in State Bank of Travancore v. Mohammad (1981) 4 SCC 82 where the words “any debt due at and before the commencement of this Act to any banking company” as occurring in section 4(1) of the Kerala Agriculturist Debt Relief Act, 1970, were construed by the Supreme Court to mean “any debt due at and before the commencement of this Act”. We, therefore, find it difficult to accept the contention of learned senior counsel that this, being a procedural provision and non-compliance of sub-section (5) of Section 85 of the Act, is a defect curable by sending the recommendation back to the Selection Committee for compliance of sub-section (5) of Section 85 of the Act.22. We are, therefore, in agreement with the High Court that the appointment of the appellant was in clear violation of sub-section (5) of Section 85 of the Act and, consequently, he has no authority to hold the post of the Chairperson of the Commission and the High Court has rightly held so.

Decision reasoning: 0[ds]21. We are of the view that non-compliance of sub-section (5) of Section 85 of the Act is not a procedural violation, as it affects the very substratum of the appointment, being a mandatory requirement to be complied with, by the Selection Committee before recommending a person for the post of Chairperson. We are of the view that non-compliance of sub-section (5) of Section 85 of the Act will vitiate the entire selection process since it is intended to be followed before making the recommendation to the State Government. Non-compliance of mandatory requirements results in nullification of the process of selection unless it is shown that performance of that requirement was impossible or it could be statutorily waived. The expressionclearly indicates that it is a mandatory requirement to be followed by the Selection Committee before recommending the name of any person for the post of Chairperson. The expressionclearly indicates the intention of the Legislature. The meaning of the expressioncame for consideration before this Court in State Bank of Travancore v. Mohammad (1981) 4 SCC 82 where the wordsdebt due at and before the commencement of this Act to any bankingas occurring in section 4(1) of the Kerala Agriculturist Debt Relief Act, 1970, were construed by the Supreme Court to meandebt due at and before the commencement of thisWe, therefore, find it difficult to accept the contention of learned senior counsel that this, being a procedural provision and non-compliance of sub-section (5) of Section 85 of the Act, is a defect curable by sending the recommendation back to the Selection Committee for compliance of sub-section (5) of Section 85 of the Act.22. We are, therefore, in agreement with the High Court that the appointment of the appellant was in clear violation of sub-section (5) of Section 85 of the Act and, consequently, he has no authority to hold the post of the Chairperson of the Commission and the High Court has rightly held so.