Case: National Institute Of Technology  Vs. Pannalal Choudhury

‘Ratification’ is the approval by act, word, or conduct, of that which was attempted (of accomplishment), but which was improperly or unauthorisedly performed in the first instance.” 37) The law of ratification was applied by this Court in Parmeshwari Prasad Gupta Vs. U.O.I (1973) 2 SCC 543. In that case, the Chairman of the Board of Directors had terminated the services of the General Manager of a Company pursuant to a resolution taken by the Board at a meeting. It was not in dispute that the meeting had been improperly held and consequently the resolution passed in the said meeting terminating the services of General Manager was invalid. However, the Board of Directors then convened subsequent meeting and in this meeting affirmed the earlier resolution, which had been passed in improper meeting. On these facts, the Court held, “Even if it be assumed that the telegram and the letter terminating the services of the appellant by the Chairman was in pursuance of the invalid resolution of the Board of Directors passed on 16-12-1953 to terminate his services, it would not follow that the action of the Chairman could not be ratified in a regularly convened meeting of the Board of Directors. The point is that even assuming that the Chairman was not legally authorised to terminate the services of the appellant, he was acting on behalf of the Company in doing so, because, he purported to act in pursuance of the invalid resolution. Therefore, it was open to a regularly constituted meeting of the Board of Directors to ratify that action which, though unauthorised, was done on behalf of the Company. Ratification would always relate back to the date of the act ratified and so it must be held that the services of the appellant were validly terminated on 17-12-1953.” 38) This view was approved by this Court in High Court of Judicature for Rajasthan Vs. P.P. Singh & Anr. (2003) 4 SCC 239. 39) The aforesaid principle of law of ratification was again applied by this Court in Maharashtra State Mining Corpn. Vs. Sunil (2006) 5 SCC 96. In this case, the respondent was an employee of the appellant Corporation. Consequent to a departmental enquiry, he was dismissed by the Managing Director of the appellant. The respondent then filed a writ petition before the High Court. During the pendency of the writ petition, the Board of Directors of the appellant Corporation passed a resolution ratifying the impugned action of the Managing Director and also empowering him to take decision in respect of the officers and staff in the grade of pay the maximum of which did not exceed Rs. 4700 p.m. Earlier, the Managing Director had powers only in respect of those posts where the maximum pay did not exceed Rs.1900 p.m. The respondent at the relevant time was drawing more than Rs.1800 p.m. Therefore, at the relevant time, the Managing Director was incompetent to dismiss the respondent. Accordingly, the High Court held the order of dismissal to be invalid. The High Court further held that the said defect could not be rectified subsequently by the resolution of the Board of Directors. The High Court set aside the dismissal order and granted consequential relief. The appellant then filed the appeal in this Court by special leave. Justice Ruma Pal, speaking for three- Judge Bench, while allowing the appeal and setting aside of the Court held as under : “The High Court rightly held that an act by a legally incompetent authority is invalid. But it was entirely wrong in holding that such an invalid act could not be subsequently “rectified” by ratification of the competent authority. Ratification by definition means the making valid of an act already done. The principle is derived from the Latin maxim ratihabitio mandato aequiparatur, namely, “a subsequent ratification of an act is equivalent to a prior authority to perform such act.” Therefore, ratification assumes an invalid act which is retrospectively validated.”“In the present case, the Managing Director’s order dismissing the respondent from service was admittedly ratified by the Board of Directors unquestionably had the power to terminate the services of the respondent. Since the order of the Managing Director had been ratified by the Board of Directors such ratification related back to the date of the order and validated it.” 40) Applying the aforementioned law of ratification to the facts at hand, even if we assume for the sake of argument that the order of dismissal dated 16.08.1996 was passed by the Principal & Secretary who had neither any authority to pass such order under the Rules nor there was any authorization given by the BOG in his favour to pass such order yet in our considered view when the BOG in their meeting held on 22.08.1996 approved the previous actions of the Principal & Secretary in passing the respondents dismissal order dated 16.08.1996, all the irregularities complained of by the respondent in the proceedings including the authority exercised by the Principal & Secretary to dismiss him stood ratified by the Competent Authority (Board of Governors) themselves with retrospective effect from 16.8.1996 thereby making an invalid act a lawful one in conformity with the procedure prescribed in Rules.41) In such circumstances, the respondents grievance that the dismissal order had not been passed by the competent authority, i.e., the BOG is no longer survived.42) In the light of foregoing discussion, we differ with the view taken by the High Court and accordingly hold that the dismissal order dated 16.08.1996 was passed by the Competent Authority, namely, the BOG as prescribed in the Rules and hence it was legal and proper. It is accordingly upheld.43) As already mentioned above, no other point was urged by the respondent in the writ petition and also in intra court appeal of the appellant by filing cross objection therein for assailing the legality and correctness of the dismissal order on other grounds except the one which we have decided. It is, therefore, not necessary to go into any other question.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]30) Reading of the aforementioned four Resolutions passed by the BOG in juxtaposition in no uncertain terms show that the BOG monitored, dealt with and eventually decided the case of the respondent in their various meetings since inception and also authorized the Principal & Secretary to deal with the same in consultation with the Chairman of Board of Governors and to do the needful by passing appropriate orders. It is also clear that in the last meeting held on 22.08.1996, the BOG approved the Resolution passed in the earlier 68th meeting held on 11.03.1996, which had dealt with the case of respondent at Item Nos. 6 and 24.31) In our considered view, the expressionto take necessary action as the Chairmanin Item No. 6 and lastly, the expressiondo the needfulin Item No. 24 in the Resolution dated 11.03.1996 were wide enough to clothe the Principal & Secretary with a power to pass the dismissal order, if occasion soIn the light of aforesaid discussion and keeping in mind the contents of the Resolutions, it is difficult to agree with the view taken by the High Court that the BOG did not pass the dismissal order but it was passed by the Principal & Secretary. In other words, keeping in view the contents of the four Resolutions, we have no hesitation to hold that the dismissal order dated 16.08.1996 was passed by the BOG and the Principal & Secretary only signed the order for and on behalf of the BOG on the strength of authorization made in his favour by the BOG vide Resolution dated 11.03.1996.34) That apart, the issue in question could be examined from yet another angle by applying the law relating to "Ratification" which was not taken note of by the HighApplying the aforementioned law of ratification to the facts at hand, even if we assume for the sake of argument that the order of dismissal dated 16.08.1996 was passed by the Principal & Secretary who had neither any authority to pass such order under the Rules nor there was any authorization given by the BOG in his favour to pass such order yet in our considered view when the BOG in their meeting held on 22.08.1996 approved the previous actions of the Principal & Secretary in passing the respondents dismissal order dated 16.08.1996, all the irregularities complained of by the respondent in the proceedings including the authority exercised by the Principal & Secretary to dismiss him stood ratified by the Competent Authority (Board of Governors) themselves with retrospective effect from 16.8.1996 thereby making an invalid act a lawful one in conformity with the procedure prescribed in Rules.41) In such circumstances, the respondents grievance that the dismissal order had not been passed by the competent authority, i.e., the BOG is no longer survived.42) In the light of foregoing discussion, we differ with the view taken by the High Court and accordingly hold that the dismissal order dated 16.08.1996 was passed by the Competent Authority, namely, the BOG as prescribed in the Rules and hence it was legal and proper. It is accordingly upheld.43) As already mentioned above, no other point was urged by the respondent in the writ petition and also in intra court appeal of the appellant by filing cross objection therein for assailing the legality and correctness of the dismissal order on other grounds except the one which we have decided. It is, therefore, not necessary to go into any other question.