Holding

The appellant was not disqualified, the State could lawfully make a contractual appointment, and the writ of quo warranto was not maintainable.

Summary

B. Srinivasa Reddy, a retired Chief Engineer, was re‑appointed as Managing Director of the Karnataka Urban Water Supply & Drainage Board on a contractual basis "until further orders". The Karnataka Urban Water Supply & Drainage Board Employees' Association, an unregistered trade union, challenged the appointment by filing a writ petition for quo warranto. The Supreme Court held that the association lacked locus standi because it was not a registered trade union at the time of filing and had approached the court with unclean hands. It further ruled that the State Government has undoubted power under the 1973 Act and its rules to make contractual appointments without a fixed tenure, and that no statutory provision was violated. Consequently, the writ of quo warranto was dismissed and the High Court's order quashing the appointment was set aside.

Issues considered

Whether the writ petition filed by the Employees' Association is maintainable given its unregistered status under the Trade Unions Act at the time of filing.
Whether the petition was motivated and filed with unclean hands, warranting dismissal.
Whether the State Government possessed the statutory power to appoint the appellant on a contractual basis "until further orders" without specifying a tenure.
Whether a writ of quo warranto lies when the alleged violation does not stem from a statutory provision.
Whether the appointment contravened Section 4(2) of the Karnataka Urban Water Supply & Drainage Board Act, 1973 or Rule 3 of the Board Rules.

Legislation cited

Constitution of Indias. Article 226, s. Article 310(2)
Industrial Disputes Act, 1947s. Section 2(q)(q) (definition of trade union)
Karnataka Urban Water Supply and Drainage Board Act, 1973s. 4(2), s. 6(1), s. 7(1)(d)
Trade Unions Act, 1926s. Section 2(q)(q)

Subjects

Service LawContractual appointmentQuo WarrantoTrade Union registrationLocus standiGovernment discretionPublic interest litigationAdministrative law

Judgment

A B. SRINIVASA REDDY
v.
KARNATAKA URBAN WATER SUPPLY AND DRAINAGE
BOARD EMPLOYEES' ASSOCIATION AND ORS.

AUGUST 28, 2006
B
[DR. AR. LAKSHMANAN AND TARUN CHATTERJEE, JJ.]

Service Law-Appointment-Contractual appointment-Appellant was
C Managing Director ofKarnataka Urban Water Supply and Drainage Board-
Pursuant to retirement he was re-appointed by State Government on the same
post on contract basis "until fi1rther orders"-Challenge to-Upheld by
High Court-Held: Government had undoubted power to make contractual
appointment until further orders-The power incfoded the power to make
appointment on substantive basis, temporary basis, officiating basis, ad hoc
D basis, daily wages or contractual basis-There was no violation of any
statutory provision because the appellant had requisite experience and
capacity before appointment-Writ petition filed by Employees' Union and
its President was motivated-Findings of legal mala tides by High Court
unsustainable-Karnataka Urban Water Supply and Drainage Board Act,
E
, J
1973 and the Rules made thereunder Sections 4(2)& 6(1) I Rule 3.

industrial Disputes Act, 1947-Section 2(q)(q)---!rade Unions Act,
1926-Chapter Jll-Managing Director of Karnataka Urban Water Supply
and Drainage Board pursuant to retirement re-appointed on the same post
on contract basis-Wr.it petition filed by Employees' union challenging the
F same-Union not registered on the date offiling writ petition-Maintainability
of the writ petition-Held, not maintainable-Constitution of India, 1950-
Article 226.

Constitution of India, 1950-Article 226-Quo Warranto-Writ of Quo
Warran to does not lie if the alleged violation is not of a statutory provision.
G
Constitution of India, 1950-Article 226-Petition praying for Writ of
Quo Warranto-/s in the nature ofpublic interest litigation-Hence it is not
maintainable at the instance of a person who is not unbiased.

Equity-Relief-Courts not to grant relief to person who comes to
H 462
B. SRINIVASA REDDY F. KARNATAKA.URBAN WATER SUPPLY &:DRAINAGE BOARD EMP. ASSON. 463
Court with unclean hands and with malafide intention/motive. A
Appellant retired as Managing Director of the Karnataka Urban Water
Supply and Drainage Board (Respondent No.4) on 31-01-2004. He was re-
appointed on the sanie post on 01-02-2004 on contract basis "until further
orders". This was challenged by Respondent No.1, the Karnataka Urban Water
Supply & Drainage Board Employees' Association, by filing writ petition. High B
Court allowed the writ petition.

In appeals to this Court, the questions which arose for consideration
are 1) Whether the writ petition framed at the instance of Respondent No. 1
was not maintainable since it was not a registered trade union on the date of
filing of the writ petition which information was withheld from the Court; 2) C
Whether the writ petition was also motivated as Respondent No. 1 had earlier
lodged a false complaint to the Lokayukta against the Appellant which was
found to be baseless and 3) Whether the State Government had the requisite
. power to make the contractual appointment "until further orders" without
specifying the period of appointment and no writ of Quo Warranto could be D
issued in that regard.

Allowing the appeals, the Court

HELD: 1.1. The petitioners in the writ petition, respondent No.1 which
is an unregistered Association under the Trade Unions Act, 1926 cannot
maintain the writ petition. [503-E] E
1.2. Chapter-Ill of the Trade Unions Act, 1926 sets out rights and
liabilities of the registered Trade Unions. Under the said enactment, an
unregistered trade union or a trade union whose registration has been
cancelled has no manner of right whatsoever, even the rights available under
the l.D. Act have been limited only to those trade unions which are registered F
under the Trade Unions Act 1926 by insertion of clause 2 (q)(q) in the I.D.
Act w.e.f. 21.08.1984 defining a trade union to mean a trade union registered
under the Trade Unions Act. 1926. The High Court miserably failed and
gravely erred in holding that respondent Nos. 1 and 2 have locus standi to
question the appointment of the appellant in the light of the change of law G

- that has been brought about by insertion of Section 2(q)(q) of the LD. Act and
having regard to the provisions of Chapter-In of the Trade Unions Act, 1926.
(481-A-D]

1.3. In the instant case, the employees association approached the High
Court with unclean hands. It has approached this Court by suppressing the H
464 SUPREME COURT REPORTS (2006] SUPP. 5 S.C.R.
A material facts and has snatched an order on the basis of wrong averments
when the employees union has no locus standi to maintain the writ petition
on the date relevant in question. Courts cannot grant any relief to a person
who comes to the Court with unclean hands and with ma/a fide intention/
motive. The writ petition filed by the employees association is liable to be
B thrown out on this single factor. The writ petitioner union made a false
averment that it is a registered trade union, and that itself is a ground to
dismiss the writ petition. Though it is eminently a fit case for awarding
exemplary costs, considering the employees financial aspect and taking a
lenient view of the matter, this Court is not ordering any costs.
(481-E, G, H; 482-AJ
c Naraindas v. Government ofMadhya Pradesh and Ors., AIR (1974) SC
1252, relied on.

Parshotam Lal Dhingra v. Union of India, AIR (1958) SC 36; Mahinder
Kumar Gupta and Ors. v. Union of India, Ministry of Petroleum Natural Gas,
D [1995) l SCC 85; Coinpar and Anr. v. General Manager, Telecom Distric1
and Ors., (2004[ 13 SCC 772; Parents Teachers Association and Ors. v.
Chairman, Kendriya Vidyalaya Sangathan and Ors., AIR (2001) Rajasthan
35 and Fertilizer Corporation Kamgar Union (Regd.) Sindri and Ors. v. Union
of India and Ors., I 19811 l sec 568, referred to.

E 2.1. The appellant was not disqualified for appointment as Managing
Director w.e.f. 1-2-2004. There is no bar for appoiatment to the post in question
on contract basis. The Government has absolute right to appoint persons on
contract basis. [503-A-BI

2.2. The power to appoint the Managing Director of the Board is vested
F in the Board under Section 4(2) of the Karnataka Urban Water Supply and
Drainage Board Act, 1973. Neither the 1973 Act nor the Rules made
thereunder prescribed any mode of appointment or tenure of appointment.
When the mode of appointment, tenure of appointment have been left to the •
discretion of the Government by the 1973 Act and the Rules made thereunder
G and the 1973 Act makes it clear that the Managing Director shall hold office
at the pleasure of the Government, the High Court could not have fettered the
discretion of the Government by holding that Section 4(2) of the 1973 Act
does not expressly give the power to the State Government to make ad hoc or
contract appointment. When the Act and the statutory rules have not
prescribed any definite term and any particular mode, the High Court could
H not have read into the statute a restriction or prohibition that is not expressly
B. SRINIYASA REDDY r. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD Ef\IP. ASSON. 465

prohibited by the Act and the Rules. It is well settled that when the statute A
does not lay down the method of appointment or term of appointment and when
the Act specifies that the appointment is one of sure tenure, the Appointing
Authority who has power to appoint has absolute discretion in the matter and
it cannot be said that discretion to appoint does not include power to appoint
on contract basis.1482-E-GI
B
2.3. There is no violation of Section 4(2) of the 1973 Act and Rule 3 of
the Rules made under the said Act as held by the High Court because the
appellant having been the Chief Engineer of the Board had experience in
administration and capacity in commercial matters before he was appointed
as M.D. on contract basis by the Government. (491-DJ
2.4. The Government has no doubt power to make contractual
c
appointment until further orders. The power included the power to make
appointment on substantive basis, temporary basis, officiating basis, ad hoc
basis, daily wages or contractual basis. The terms and conditions of the order
appointing the appellant made it clear that the appointment is temporary and
is until further orders. An appointment which is temporary remains temporary D
and does not become permanent with passage of time. The finding recorded
by the High Court that the appointment is bad for the reason that the
appointment which was made on temporary basis has continued for nearly 2
years is wholly contrary to law rarticularly when the Act and the Rule do not
stipulate maximum period of appointment. The High Court gravely erred in E
issuing a Writ of Quo Warrant a when there is no clear violation of law in the
appointment of the appellant. The jurisdiction of the High Court to issue a
Writ of Quo Warran/a is a limited one which can only be issued when the
appointment is contrary to the statutory rules.
(482-C, G, H; 483-A; 484-D; 503-DJ
F
Ramachandran v. A. Alagiriswami, Govt. Pleader High Court, Madras
& Anr., AIR (1961) Madras 450; High Court of Gujarat & Anr. v. Gujarat
Kishan Mazdoor Panchayat & Ors., (2003) 4 SCC 712 and Mor Modern Coop.
Transport Society Ltd v. Financial Commissioner & Secretmy to Government
of Haryanq, (2002( 6 SCC 269, relied on.
G
-- R.K. Jain v. Union of India, (1993 J 4 SCC 119; A. N. Sashtri v. State of
Punjab and Ors., (1988) Supp SCC 127; Dr. B. Singh v. Union of India and
Ors., (2004) 3 SCC 363; The University of Mysore and Anr. v. C.D. Govinda
Rao and Anr., (1964( 4 SCR 575; Ghulam Qadir v. Special Tribunal and Ors.,
(2002( l SCC 33; Union of India v. KP. Joseph & Ors., (1973) 1SCC194;
Statesman (Private) ltd v. H.R. Deb, (1968) 3 SCR614; Dr. UmakantSaran H
466 SUPREME COURT REPORTS [2006] SCPP. 5 S.C.R.

A v. State of Bihar, f197311SCC485; Kumari Chitra Ghose v. Union of India,
(196912SCC228; P.l. lakhanpa/ v. Ajit Nath Ray, AIR (1975) Delhi 66;
Rajendra Prasad Yadav v. State of Madhya Pradesh, f199716 SCC 678; Satish
Chandra Anandv. Union of India, 119531SCR655 and P.K. Sandhu (Mrs.) v.
Shiv Raj V. Patil, 119971 4 SCC 348, referred to.

B 3.1. It is settled law by a catena of decisions that Court cannot sit in
judgment over the wisdom of the Government in the choice of the person to be
appointed so long as the person chosen possesses prescribed qualification
and is otherwise eligible for appointment. In the instant case, the discretion
available to the competent authority under the Rules has been exercised by
C the appointing authority in making the appointment of the appellant. That could
not have been annulled by the High Court. (485-C; 495-H; 496-Af

3.2. The finding of legal ma/a jides by the High Court is unsustainable
being based on a misunderstanding of the law and facts. When a competent
and experienced officer of an outstanding merit is appointed to a higher post
D on contract basis after his super-annuation from service in larger public
interest does not suffer from legal malice at all. The appointment was made
in the interest of the Board and the State at a time when nobody else other
than the appellant could have served the interests of the State better. The High
Court failed to appreciate the element of urgency involved in making the
appointment because of impending negotiations with the World Bank. The writ
E petition was motivated as respondent No.I had lodged a false complaint to the
Lokayukta against the appellant which was found to be baseless by the
Lokayukta. A petition praying for a Writ of Quo Warranto being in the nature
of public interest litigation, it is not maintainable at the instance of a person
who is not unbiased. The second respondent is the President of the first
F respondent- Union. He has chosen this forum to settle personal scores against
his erstwhile superior officer after his retirement. The proceedings is not
meant to settle personal scores by an employee of the department. The High
Court ought to have dismissed the writ petition filed by respondent No.I at
the threshold. In any event, respondent No. I failed to discharge the heavy
burden to substantiate the plea of malajides. [497-F-H; 498-A-C)
G
3.3. The post of Managing Director is a highly respectable post. It is a
post of great confidence - a lynchpin in the administration and smooth
functioning of the administration requires that there should be complete
rapport and understanding between the Managing Director and the Chief
Minister. The Chief Minister as a Head of the Government is in ultimate
H
)

B. SRINIVASA REDDY~·. KARNATAKA URBAN WATER SUPPLY lt DRAINAGE BOARD EMP. ASSQN. 467

charge of the administration and it is he who is politically answerable to the A
people for the achievements and failures of the Government. If the Chief
Minister forfeits the confidence on the appellant, he may legitimately in the
larger interests of administration appoint him until further orders as M.D.
of the Board. It does not involve violation of any legal or constitutional rights.
Secondly that the vast multitudinous activities in which a modern State is B
engaged, there are bound to be some posts which require for adequate
discharge of their functions, high degree of intellect and specialized
experience. It is always a difficult problem for the Government to find suitable
officers for such specialized posts. There are not ordinarily many officers
who answer the requirements of such specialized posts and the choice with
the Government is very limited and this choice becomes all the more difficult, C
because some of these posts, though important and having onerous
responsibilities, do not carry wide executive powers and officers may not,
therefore, generally be willing to be transferred to those posts. The
Government has in the circumstances to make the best possible choice it can,
keeping in view the larger interests of the administration. When in exercise
of this choice, the Government transfers an officer from one post to another, D
the officer may feel unhappy because the new post does not give him the same
amplitude of powers which he had while holding the old post. But that does
not make the appointment arbitrary. So long as the appointment is made on
account of the exigencies of administration, it would be valid and not open to
attack under Arts. 14 & 16 of the Constitution. Here the post of M.D. was E
admittedly a selection post and after careful examination of the merits, the
Chief Minister selected the appellant for the post of M.D. It was not the case
of the respondents that the appellant was not found qualified to the task or
that his work was not satisfactory. [499-H; 500-A-F)

3.4. The High Court erred in probing the mind of the Government and F
acted contrary to its own finding on the role of appointing authority in Quo
Warranto proceedings. The Division Bench was not right in quashing the
appointment of the appellant as Managing Director on the misconception that
he has been re-appointed to the said office, whereas it was a fresh appointment
under the provisions of the Act and in accordance with the prescribed G
qualification and eligibility under the Act. Further the appointee holds the
office during the pleasure of tire Government as provided under Section 6(1)
of the 1973 Act. The Division Bench was not correct in holding that the
Government is not affected by allowing thE writ of Quo Warranto against the
appointee and in observing that the Government ought not have filed the appeal..
The Bench failed to appreciate that it is the duty of the Government to justify H
468 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A the appointment as such there is no wrong in filing the writ appeal.
1502-E-H)

Centre for Public Interest litigation & Anr. v. Union of India & Anr.,
120051 8 sec 202, distinguished -
B E.P. Royappa v. State of Tamil Nadu, (197412 SCR 348 and B.R. Kapur
v. State of Tamil Nadu & Anr., (2001 ( 7 SCC 231, referred to.

4. The Division Bench of the High Court ordered cost in the writ appeal.
There is no justification in ordering cost in the facts and circumstances of
the case. Therefore, the appellant, State Government and respondent No.4 are
C entitled to refund the cost, if it has already been paid. However, this Court is
not ordering cost against respondent Nos. 1 & 2 taking into consideration of
the financial constraint of the employees and by taking a lenient view of the
matter. Appellant has already been released and in his place a person has
already been appointed as a Managing Director of the Board on contract basis.
D Keeping this admitted fact in mind, this Court, therefore, keeps it on record
that the Government or the Board would be at liberty to consider and appoint
a candidate, if occasion arises, on contract basis. If such a situation does arise
in that case it would be open to the State or the Board to consider the
candidature of the appellant with others. (503-H; 504-A, BJ

E CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3719 of2006.

From Final Judgment and Order dated 3/4.4.2006 of High Court of
Kamataka at Bangalore in Writ Appeal/No. 86/2006.

WITH
F
C.A. No. 3722 of2006.

P.P. Rao, P.S. Raj~gopal, Lalit Mohini Bhat, Naveen R. Nath, Hetu Arora
and Sanjay R. Hegde for the Appellant.

G Raju Ramachandran, Devashish Bharuka, Hansa Bharuka, Ruchi Kohli,
Alok Sangwan and Sushi! Balwada for the Respondents.

The Judgment of the Court was delivered by

DR. AR. LAKSHMANAN, J. Leave granted in both the special leave
H petitions.
B. SRINIVASA REDDY 1·. KARNATA~A URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. ILAKSHMANAN. 11 469

These appeals have raised substantial questions of law involving A
interpretation of certain provisions of the Karnataka Urban Water Supply artd
Drainage Board Act, 1973 (for short "the Act") and the Rules made thereunder
and also the principles of law governing the Writ of Quo Warran/a and the
power of the Government to make a contractual appointment under Section
4(2) of the Act.
B
Civil Appeal No. _ _ of 2006

(Arising out of SLP (C) No. 9393 of 2006)

This appeal was filed by Mr. B. Srinivasa Reddy (hereinafter called Mr.
Reddy) seeking leave to appeal against the final judgment and order dated C
04.04.2006 passed by the High Court of Karnataka at Bangalore in Writ
Appeal No. 86 of2006. By the impugned order, the High Court dismissed the
writ appeal filed by the appellant-herein against the order dated 10.01.2006
passed by a learned Judge of the said Court in Writ Petition No. 9852 of2004
and has declared that the appellant is not entitled to hold the post of D
Managing Director of the Karnataka Urban Water Supply & Drainage Board
(hereinafter called 'the Board') (respondent No.4).

Civil Appeal No._ _ _ of 2006

(Arising out ofSLP (C) No. 10388 of2006)
E
The above appeal was filed by the Government of Karnataka against the
very same judgment passed by the Division Bench of the High Court in Writ
Appeal No. 254 of 2006 whereby the Division Bench dismissed the writ appeal
filed by the State.
F
FACTS:

.. The Karnataka Urban Water Supply & Drainage Board Act, 1973 was
enacted to prnvide for the establishment of water supply and drainage Board
and the regulation and development of drinking water and drainage facilities
in the urban areas in the State of Karnataka. The Board, with the previous G
sanction of the Gcvernment of Karnataka, framed the Karnataka Urban Water
Supply & Drainage Board Service5 (Cadre and Recruitment) Regulations,
1985. An amendment to serial No. 1 of the Schedule to the Regulations was
introduced by the Board whereby even the Chief Engineers of the Board were
made eligible for appointment to the post of Managing Director. Respondent
H
•

470 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R

A No. I is the Karnataka Urban Water Supply & Drainage Board Employees'
Association represented by its President Halakatte. He is also .respondent
No.2 in his capacity as President of the Employees' Association. The State
of Kamataka and the Board are also the contesting respondents 3 and 4 in
this appeal. Respondent No. I (hereinafter called the Employees' Association)
B filed writ petition No. 4400 I of 1995 in the High Court of Karnataka challenging
the appointment of one S. Ramamurthy as the Managing Director of the Board
on the ground that by virtue of Section 7(1)(d) of the Act, the said Ramamurthy,
being an officer/servant (Chief Engineer earlier) of the Board, could not have
been appointed as the Managing Director of the Board.

C The Government of Karnataka, vide notification No. UDD/14/UB/91
dated 28.04.1997, nominated the appellant who was a Chief Engineer of the
Board as one of the Directors of the Board "with immediate effect and until
further orders". The Board, after due approval of the State, vide G.O. No. HUD
15 UWE 93 dated 11.12.1997, amended the method of recruitment for the post
of Managing Director of the Board in serial No. I of the Schedule to the
D Regulations to the effect that a Managing Director can be selected only from
amongst the Chief Engineers of the Board. Other criterias were removed.

On 28.01.1998, the Government of Karnataka, through the Urban
Development Department, vide Notification No. UDD 4 UWE 98 dated
28.01.1998, pursuant to Section 53 of the Act read with Rule 27 of and serial
E No. I of the Schedule to the Regulations, promoted the appellant on officiating
basis and <1ppointed him as the Managing Director of the Board w.e.f. 31.01.1998
afternoon and "until further orders" since S. Ramamurthy, the then Managing
Director of the Board took voluntary retirement.

F The Employees' Union filed an amended version of the writ petition
before the High Court also challenging the above-mentioned amendment to
the Regulation which relates to making of a provision of appointing the Chief
Engineer of the Board as its Managing Director. The writ petition was further
amended to include the challenge to the promotion/appointment of the appellant •
as the Managing Director of the Board pursuant to the said amendment.
G
The learned Single Judge ofthe High Court allowed the writ petition on
12.04.2002 and held:

(a) that the impugned amendment of the Regulations was illegal
since the same was contrary to Section 7(1 )( d) of the Act;
H (b) that the appointment of the appellant is illegal since, being a
•

B. SRINl.YASA REDDY 1·. KARNATAKA URBAN WATER SUPPLY & D.JlAINAGE BOARD EMP. ASSON. fLAKSHMANAN.J.I 471

Chief Engineer of the Board, he was disqualified under Section A
7(1)(d) of the Act and hence his appointment was;contrary to the
provisions of Sections 7(1 )( d), 68 and 69 of the Act, Rules and
Regulations;
(c) that the appointment was further held to be illegal since it was
also contrary to Regulation 27 of the Regulations as the B.
appointment was not restricted to one year but until further
orders.

The High Court quashed the appointment orders and directed the State
to take immediate steps to appoint the Managing Director of the Board.

Writ appeals were filed by the Board, the Government and the appellant-
c
Mr. Reddy.

The Division Bench of the High Court in Writ Appeal No. 2877-78 of
2002, i_ssued notice and stayed the order of the learned Single Judge for a
period of two
months which was later continued. By virtue of this order, the D
appellant continued to enjoy the post of Managing Director.

The appellant retired as Managing Director of the Board on 31.01.2004.
The Relieving Order reads thus:

"Sri B. Srinivasa Reddy, Managing Director, KUWS&DB who retired E
from service on attaining super annuation as 31-01-2004 is relieved
from his duties on the afternoon of 31-01-2004."

He was re-appointed as Managing Director of the Board until further
orders on 01.02.2004. Writ Petition No. 9852 of2004 was filed for a Writ of
Certiorari, Writ of Quo Warranto and any other writ, order or direction under F
Article 226. Learned Single Judge allowed the Writ Petition No. 9852 of2004.
Writ Appeal N1>. 86 of 2006 was admitted and the operation of the learned
Single Judge's order was stayed on 16.01.2006 and Writ Appeal No. 86 of2006
was finally dismissed on 04.02.2006.

The Court also. imposed costs of Rs. I0,000/- against the appeilant and G
also imposed cost against the State Government and responderit No.4 at
Rs.5,000/- each separately.

It is pertinent to notice. that in 2002, a complaint was made to the
Lokayukta against the Chairman and the appellant - Mr. Reddy by Mr. Halakatte, H
472 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A President of the Employees' Association (R2 herein). By order dated 13.08.2003
Lokayukta held that the allegation against the appellant is baseless. Lokayukta
after absolving the appellant of false allegations directed action against the
then FA & CAO of the Board. The Lokayukta closed the complaint on
01.02.2005 after Government has taken action against FA & CAO.

B We heard Mr. P.P. Rao, learned senior counsel assisted by Mr. P.S.
Rajagopal, learned counsel for the appellant and Mr. Sanjay R. Hegde for the
State of Kamataka and Mr. Raju Ramachandran, learned senior counsel assisted
by Mr. Devashish Baruka and Mrs. Hansa Baruka, learned counsel for the
contesting respondent - the Employees' Union.
c Mr. P.P. Rao, learned senior counsel made elaborate submissions on
facts and on law with reference to the pleadings, annexures, judgments and
the relevant provisions of the Act. He made submissions on the following
issues:-

I. Writ petition as framed not maintainable at the instance of an
D unregistered Trade Union;
2. Locus of the writ petitioners - Employees' Union;
3. No Writ of Quo Warranto unless there is violations of statutory
provisions in making appointment;
E 4. No violation of Section 4(2) and or Rule 3 of Rules as held by
the High Court;
5. Government has always the power to make contractual
appointment until further orders and finding to the contrary is ex
facie erroneous;
F
6. High Courts reliance on official Memorandum dated 23 .12.1994 is
erroneous;
7. Pleasure of the Government under Section 6(1) of the Act and
Rule 3 of the Rules which envisages the qualifications;
G 8. Until further orders-pleasure of the Government and discretion;
9. Legal malice-finding is unsustainable;
10. Writ petition by RI, R2 was motivated as RI had lodged a false
complaint to the Lokayukta against the appellant Reddy which
was found to be baseless.
H
B. SRINIVASA REDDY''· KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. ILAKSHMANAN. J.[ 473

The above submissions will be dealt with in extenso in paragraphs A
infra.

Mr. Sanjay R. Hegde adopted the arguments of Mr. P.P. Rao. He invited
our attention to Article 310(2) of the Constitution of India.

Article 310 deals with tenure of office of persons serving the Union or B
a State. Under the pleasure doctrine, a servant of the Government holds office
during the pleasure of the sovereign. But in order to protect civil servant
against the political interference Article 311 introduces certain safeguards.
Moreover, a specific contract can override the doctrine of pleasure as reported
... in Parshotam Lal Dhingra v. Union of India, AIR (1958) SC 36.
c
Mr. Raju Ramachandran in his usual fairness fairly conceded that he is
not questioning the State Government's power in appointing persons on
contract basis. According to him, the entire case is not based on end of lack
of power but an abuse and mis-use of that power by the State Government.
According to him, non-specification of a period of appointment amounts to D
abuse of power, mis-use of power and illegal malafides and that power is not
used for the purpose for which it is vested in the Government. According to
him, form of the writ should not be a matter which should inhibit the Court.
This argument was advanced in regard to the prayer made in the writ petition
on the maintainability of the writ petition. Mr. Raju Ramachandran submitted
>
though the employees association was not a registered body on the date of E
filing of the writ petition, the association was registered again as a trade union
under the Trade Unions Act on 20.01.2005 and that though the employees
union was not a registered trade union but was a recognized union by all and,
therefore, the association is entitled to maintain the writ petition as framed.
He also made elaborate submissions with reference to the records, annexures F
and the judgments and of the Government orders.

Mr. Raju Ramachandran also submitted that the civil appeal has now
become infructuous in view of the developments which have taken place
subsequent to the orders of this Court dated 08.05..2006 by which notice was
is;med to the respondents in view of the fact that the Government of Karnataka G
has now appointed one Mr. P.B.Ramamurthy as the Managing Director of the
Board with immediate effect by an. order contained in the notification dated
17.05.2006 and pursuant to the above order the appellant Mr.Reddy has
already made over the charge of the office of Managing Director of the Board
to the said P. B. Ramamurthy who had received charge of the said office on
H
474 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A 19.05.2006. It was submitted that the appellant has no substantive right left
qua the post of Managing Director of the Board since even as per his
appointment order dated 31.01.2004 he is to have charge only "until further
orders". In view of the above subsequent developments, learned counsel for
the Union submitted that the present appeal has become infructuous.

B According to Mr. Raju Ramachandran, though the power to appoint is
vested with the State Government under Section 4(2) of the Act the same is
not unfettered or uncontrolled. It cannot be based on mere ipsi dixit of the
Government the discretion of the Government cannot be said to be without

C
any bounds. If the High Court on the facts of a particular case finds that such
discretion has been mis-used, the High Court would be within its power to
...
check such actions of the Government.

According to him, a Writ of Quo Warranto would lie to challenge an
appointment made until further orders on the ground that it is not a regular
appointment. Merely because the appointment is for until further orders
D would oust the jurisdiction of the High Court to issue a Writ of Quo Warranto
when it is found that the very appointment was illegal and not warranted
within the provision of law.

It is submitted that the words-pleasure of the Government found in
Section 6( I) of the Act cannot be given a meaning so as to grant arbitrary
E and un-fettered powers to the Government with respect to appointment of a
Managing Director to the Board. It is submitted that the words cannot mean .
as absolute and unconditional will of the Government, for that would go
counter to the constitutional scheme and to the rule of law itself.

In the instant case, under the guise of temporary appointment made
F until further orders, the Government in fact by misusing its discretionary
powers ensured that the appellant's appointment continues without any limit
as to tenure or term. It is submitted the High Court rightly passed the
impugned order since the appointment was in violation of the provisions of
law. It is submitted that no appointment to a public post can be made without
G a specific tenure. According to Mr. Raju Ramachandran, the official
memorandum dated 23. 12.1994 squarely applies to the Board in question and
that the said memorandum in express terms provide that procedure contained
therein shall apply, inter alia, to Boards which are subordinate to or under
the control of the Government. It is thus submitted that the Board is covered
with the said memorandum.
H
B. SRINIVASA REDDY 1·. KARNATAKA URBAN WATER SUPPLY&:. DRAINAGE BOARD EMP. ASSON. [LAKSHMANAN. J.j 475

It is further contended that Section 7( 1) (d) of the Act read with the A
above official memorandum would make it clear that retired employees cannot
be appointed the post of Managing Director of the Board. The purpose of
Section 7(l)(d) and the office memorandum dated 23.12.1994 has to be looked
into while deciding the legality of the appointment of the appellant to the post
of Managing Director of the Board. According to Mr. Raju Ramachandran it
has nowhere come on record that the appellant possessed such exceptional B
and high qualifications as to warrant the Government to deviate from its own
policy and appointed the appellant. In fact any experience gained by the
appellant during his tenure as the Managing Director prior to his retirement
is of no consequence since such appointment was held to be illegal and
invalid by the High Court. No exceptional circumstances has been shown that C
the appointment of the appellant to the post of Managing Director in deviation
to regular mode of appointment of IAS officers Jn deputation.

In regard to the maintainability of the writ petition Mr. Raju Ramachandran
submitted that the High Court did not .rely upon the status of the writ
petitioners as registered trade union but rather accepted their locus standi as D
employees of the Board and their right to form trade unions associations
though unregistered and on such basis permitted them to challenge the
appointment in writ proceedings. According to him, the unregistered unions,
in the eyes of law can contend that it has to come and knock the doors of
this Court seeking justice by pointing out the illegalities of the State E
Government in appointing the appellant as Managing Director of a Statutory
Board wherein public interest is involved. The purpose, according to him, is
to espouse the cause of the workers. Therefore, the writ petitioners were
employees of the Board and cannot be considered as wayfarers and that the
employees approached the High Court in public interest and have been
attempting to dissuade the Government from granting favour to the appellant F
herein by appointing him at the post of Managing Director of the Board for
long.

We have carefully considered the rival submissions with reference to
the entire records.
G
( 1) Locus of the unregistered Trade union = Maintainability:

Respondent No. I association was a recognized association. It is
registered again as a trade union on 20.01.2005 i.e. before the pronouncement
of judgment of the learned single judge. Respondent No.2 Halakatte, who is
the President of Respondent No. I in his individual capacity has also challenged H
476 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A the appointment. In Quo Warran/a proceedings any concerned person can
file a writ petition. While dealing with the locus, the High Court has relied
upon the right of persons to form association and consequently to file a Writ
in Quo Warranto proceedings.

In fact, Mr. Rao distinguished the cases referred to by the respondents
B on ·the issue of non-registered associations having no locus to file writ
petitions as distinguishable and inapplicable in the present facts and
circumstances.

In Mahinder Kumar Gupta and Ors. v. Union of India, Ministry of
C Petroleum and Natural Gas, [1995] l SCC 85, this Court held that the writ
petition filed by an Association is not maintainable as Association has no
fundamental right under Article 32 of the Constitution of India.

In Coinpar and Anr. v. General Manager, Telecom District and Ors.,
[2004] 13 SCC 772, the appellant before this Court was an Association which
D claims working in public interest preferred an appeal against the judgment of
the High Court with an application for permission to file special leave pet:tion.
The said permission was granted. After the matter was heard, this Court
found that the appellant was neither party in the case before the Forum nor
before the High Court. It was also not shown before this Court in what
manner the appellant was aggrieved by the judgment of the High Court. This
E Court held that the appellant has no locus standi and cannot be permitted to
challenge the judgment of the High Court.

Our attention was also drawn to the proceedings of the Deputy Registrar
of the Trade Union Dharwad (Division) Hub Ii dated 02.11.1992 Government
of Karnataka (Department of Labour). The said proceedings reads thus:-
F
"Subject: Cancellation of registration of Trade Unions, under Trade
Union Act, 1926.
Reference: This office notice No. TUA/AR.1991 dated 30.7.1992

G *****
WHEREAS a notice was issued from this office to the General Secretary/
Secretary, Kamataka Urban Water Supply & Drainage Board Employees
Association, Hubli, cause as to why the registration of trade union
should not be cancelled owing to the violation of the provisions of
H section 28 of the Trade Union Act, 1925, by not submitting the
B. SRINIVASA REDDY r. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. ILAKSHMANAN. JI 477

Annual Return of the union for the year ending 3 lst December, 1991. A
AND whereas the union was not complied with the above
requirements, even after notice, contravened the above provisions of
law. Therefore in exercise of my powers conferred under Section IO(b)
of the Act, 1 hereby order that the Registration of the Water Supply
& Drainage Board Employees Association, Hubli Bearing Registration B
No. 544/85 be cancelled with effect from the date of this order.

The General Secretary is hereby directed to surrender the certificate
of registration."

In the instant case, the appellant was appointed w.e.f. 01.02.2004. The C
Employees Union filed the writ petition on 08.03.2004. On the said date, the
respondent-Union was not a registered trade union and the Certificate of
Registration of the Trade Union in Form 'C' was issued by the Government
of Kamataka, Department of Labour only on 20.01.2005 which reads thus:-
"lt is hereby certified that the D
Kamataka Nagar Niru Sarbaraju Mattu Olacharandi Noukarar Sangha,
Dharwa.
has been registered under the Indian Trade Unions Act, 1926.
Dated: 20th January 2005
Sd/ E
Deputy Registrar of Trade Unions
Assistant Labour Commissioner,
Dharwad Division, Hubli."
Jh Parents Teachers Association and Ors. v. Chairman, Kendriya
Vidyalaya Sangathan and Ors., AIR (2001) Rajasthan 35, speaking for the F
Bench, Chief Justice Dr. AR. Lakshmanan, in paras 12 and 13 observed as
under:- ·

"(12). The appellant-petitioners have not placed before this Court any
document to show that the Parents-Teachers Association is a registered
and recognised association. The writ petition has been allegedly filed G
,,, in public interest and the alleged large interest of the students. It is
evident that the so-called Parents- Teachers Association is an
unregistered and unrecognised association and, therefore, in our view,
has no fundamental right to approach this Court under Article 226 of
the Constitution. This point has been concluded by the decision of
H
478 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A .the Apex Court in the case of Mahendra Kumar Gupta (supra) and
by the decision of Full Bench of this Court in the case of RSEB
Accountant's Association (supra). A reply to the preliminary objection
raised by the respondents was also made by the appellants. It is
stated that the Parents-Teachers Association has been recognised by
the KVS and that the Principal is the Vice Chainnan of the said
B Association and hence, the Association is competent to file the writ
petition on behalf of the students. In our view, the above reason
cannot be considered as a valid reason for maintaining the writ petition.
It is not in dispute that the Association is not a registered body and
recognised Association. Thus, after examining this point of law in
c detail and placing reliance on various judgments delivered by the
Apex Court from time to time, the Full Bench of this Court in the case
of RSEB Accountant's Association (supra) held as under:-
"It may also be observed that an unregistered association has no
fundamental right to approach this Court under Art. 226 of the
D Constitution and this point is concluded by the decision in the
case of Shri Maninder Kumar Gupta v. Union of India, MiniStlJ'
of Petroleum and Natural Gas, JT (I 995) I SC 11. A decision in
the case of Akhil Bharatiya Soshit Karamchari Sangh v. Union
of India and Ors., AIR (1981) SC 298 was relied where the non-
registered Association was held to apply under Art. 32 of the
E Constitution. We may observe that there had been number of the
instances of public interest litigation where large body of persons
is having the grievance against inaction of the State. Even letters
have been considered to be a writ petition but all these are the
matters where large section of public is affected and the personal
F interest of any person or a smaller section as in the present case,
is not involved. Even in the case of People's Union for Democratic
Rights v. Union of India, AIR ( 1982) SC 1473 when the question
of locus standi was considered, the Hon 'ble Supreme Court had
taken into consideration the poverty, illiteracy and the ignorance
obstructing and impeding accessibility of the judicial process
G and on that ground it was considered that the writ petition can
be filed. In D.S. Nakara & Ors. v. Union ofIndia, AIR (1983) SC •
130 the old pensioners individually were unable to undertake
journey through labyrinths of costly and protracted legal judicial
process for allowing to espouse their cause. In case of S.P.
H Gupta and Ors. v. President of India, AIR (1982) SC 149 poverty,
B. SRIN\VASA REDDY r. KARNATAKA URBAN WATER SUPPLY & DRAlNAGE BOARD EMP. ASSON. ILAKSHMANAN. J.I 479

helplessness and disability or social or economic disadvantaged, A
position was considered a sufficient ground for maintaining the
writ petition. There had been other decisions of the Apex Court
as well and principles which emerge from all of them are as
under:-

(a) That the members of the said association should have sufficient B
strength so as to come in the category of a large sect of public.

(b) That the members should be identifiable.

(c) That the members must be of the category of poor/illiterate/helpless
or disabled. C
(d) That the individual member must not be capable of filing a writ
petition.

(e) That the entire body of the members must authorise the association
to protect their legal rights.
D
(f) That such an association must have its own Constitution, and

(g) That there must be authority to file a writ petition on behalf of all
the members."

(13). In the instant case, none of the grounds mentioned above in (a) E
to (g) have been satisfied by the present appellants to maintain the
writ petition. Since the above conditions are not fulfilled such an
unregistered association cannot file writ petition in respect of the
legal rights of the said association for the alleged breach of fundamental
right as the association itself has no fundamental right of its own.:'
F
We shall now advert to the provisions of the Industrial Disputes Act
with reference to the registration of Trade Unions. Section 2( q)( q) defines
trade union which means a trade union registered under the Trade Unions
Act, 1926 (16 of 1926). Section 36 of the Industrial Disputes Act, 194 7 says
that the workman who is a party to dispute shall be entitled to be represented
in any proceedings under this Act by any member of the executive or other G
office bearer of a registered trade union of which he is a member or by any
member of the executive or other office bearer of a federation of trade unions
to which the trade unions referreci to in clause A is affiliated. The writ
petitioner union made a false averment that it is a registered trade union that
~- itself, in our opinion, is a ground to dismiss the writ petition. The writ H
480 SUPREME COURT REPORTS (2006] SUPP. 5 S.C.R.
A petitioner has made an averment to the following effect in its writ petition
which is also reflected in the order passed by the High Court in the writ
petition which runs thus:

"The petitioner is a registered Trade Union of employees of 2nd respondent
Karnataka Urban Water Supply & Drainage Board (hereinafter referred to as
B 'the Board') constituted under the Karnataka Urban Water Supply and Drainage
Board Act, 1973 (hereinafter referred to as 'the Act')."

In the writ petition filed by respondent Nos. I and 2 their locus standi
to challenge the appointment of the appellant was asserted in the following
words:-
c
"The petitioner Association is Trade Union registered under the
Trade Unions Act, 1926. The petitioner is the only registered trade
union existing in the 2nd respondent-Board The Board has held
several negotiations with the petitioner Union in regard to the service
conditions of the employees of the 2nd respondent-Board since its
D formation in the year 1986. The Board has entered into several
settlements with the petitioner Union with regard to their service
conditions. The petitioner which is a recognized trade union is entitled
to agitate the matter with regard to the appointment of the 3rd
respondent to the Board. The petitioner is concerned about the·
E functioning of the 2nd respondent-Board, and as such is entitled to
question the appointment of the 3rd respondent as Managing Director
on contract basis. Hence, the petitioner has locus standi to file this
Writ Petition."

(Emphasis supplied)
F
These averments were established to be false. The registration of the
first respondent under the Trade Unions Act had been cancelled as early as
on 02.11.1992. It is not a registered and recognized union. In fact, it was
pointed out that recognized association is one Karnataka Urban Water Supply
and Drainage Board Officers and Employees Association and the first
G respondent does not have even a handful of members. The fact of cancellation
of registration of the first respondent came to the knowledge of the appellant
long after the disposal of the earlier writ petition No. 4400I of 1995 wherein
the Court had given a finding that the first respondent has locus standi to
challenge the appointment of the appellant to the post of Managing Director
H of the Board solely on the ground that it is a registered Trade Union. In our
B. SRI NI VASA REDDY r. KARNATAKA URBAN WATER SUPPLY&. DRAINAGE BOARD EMP. ASSON. ILAKSHMANAN. J.I 48)

opinion, the High Court gravely erred in refusing to examine the question of A
locus standi on the ground that it is decided in the earlier writ petition which
operates as res judicata and that the petitioners even otherwise have locus
standi. Chapter-III of the Trade Unions Act, 1926 sets out rights and liabilities
of the regisiered Trade Unions. Under the said enactment, an unregistered
trade union or a trade union whose registration has been cancelled has no
manner of right whatsoever even the rights available under the l.D. Act have B
been limited only to those trade unions which are registered under the Trade
Unions Act 1926 by insertion of clause 2 (q)(q) in the I.D. Act w.e.f. 21.08.1984
defining a trade union to mean a trade union registered under the Trade
Unions Act, 1926.

The High Court, in our opinion, miserably failed and gravely erred in
c
holding that the respondent Nos. I and 2 have locus standi to question the
appointment of the appellant in the light of the change of law that has been
brought about by insertion of Section 2(q)(q) of the I.D. Act and having
regard to the provisions of Chapter-Ill of the Trade Unions Act, 1926. This
Court, in many judgments, held that the Union has locus standi in the facts D
and circumstances of that case, however, cautioning that if a citizen is no
more than a wayfarer or officious intervener without any interest or concern
that what belongs to anyone of the 660 million people of this country.
Fertilizer Corporation Kamgar Union (Regd) Sindri and Ors. v. Union of
India and Ors., [1981] I sec 568. The doors of the Court will not ajar for him. E

In the instant case, the employees association approached the High
Court with unclean hands. The employees who approaches the Court for such
relief must come with frank and full dis-closure of facts. If they failed to do
so and suppress material facts their application is liable to be dismissed.
F
The Constitution Bench of this Court in Naraindas v. Government of
Madhya Pradesh and Ors., AIR (1974) SC 1252 held that if a wrong or mis-
leading statement is deliberately and wilfully made by a party to a litigation
with a view to obtain a favourable order, it would prejudice or interfere with
the due course of judicial proceeding and thus amount to contempt of court.
G
It is thus crystal clear that the Employees' Union have approached this
Court by suppressing the material facts and has snatched an order on the
basis of wrong averments when the employees union has no locus standi to
maintain the writ petition on the date relevant in question. Courts cannot
grant any relief to a person who comes to the Court with unclean hands and
H
482 SUPREME COURT REPORTS [2006) SUPP. 5 S.C.R.

A with ma/a fide intention/motive. The writ petition filed by the employees
association is liable to be thrown out on this single factor. Though it is
eminently a fit case for awarding exemplary costs, considering the employees
financial aspect and taking a lenient view of the matter, we are not ordering
any costs.

B (2) Writ of Quo Warranto:

Whether a Writ of Quo Warranto lies to challenge an appointment made "until
further orders" on the ground that it is not a regular appointment. Whether
the High Court failed to follow the settled law that a Writ of Quo Warranto
C cannot be issued unless there is a clear violation of law. The order appointing
the appellant clearly stated that the appointment is until further orders. The
terms and conditions of appointment made it clear that the appointment is
temporary and is until further orders. In such a situation, the High Court, in
our view, erred in law in issuing a Writ of Quo Warranto the rights under
Article 226 can be enforced only by an aggrieved person except in the case
D where the writ prayed for is for Habeas Corpus or Quo Warranto.
In the instant case, the power to appoint the Managing Director of the Board
is vested in the Board under 4(2) of the Act. Neither the Act nor the Rule
prescribed any mode of appointment or tenure of appointment. When the
mode of appointment, tenure of appointment have been left to the discretion
E of the Government by the Act and the Rules and the Act makes it clear that
the Managing Director shall hold office at the pleasure of the Government the
High Court could not have fettered the discretion of the Government by
holding that Section 4(2) of the Act does not expressly give the power to the
State Government to make ad hoc or contract appointment when the Act and
F the statutory rules have not prescribed any definite term and any particular
mode, the High Court could not have read into the statute a restriction or
prohibition that is not expressly prohibited by the Act and the Rules. It is well
settled that when the statute does not lay down the method of appointment
or term of appointment and when the Act specifies that the appointment is
one of sure tenure, the Appointing Authority who has power to appoint has
G absolute discretion in the matter and it cannot be said that discretion to
appoint does not include power to appoint on contract basis. An appointment
which is temporary remains temporary and does not become a permanent with
passage of time. The finding records by the learned Single Judge that the
appointment is bad for the reason that the appointment which was made on
H temporary basis has continued for nearly 2 years is wholly contrary to law
B. SRINl\'ASA REDDY 1·. KARNATAKA URBAN WATER SUPPLY&. DRAINAGE BOARD EMP . .'\SSON. ILAKSHMANAN. J.I 483

particularly when the Act and the Rule do not stipulate maximum period of A
appointment. The High Court, in our view, gravely erred in issuing a Writ of
Quo Warranto when there is no clear violation of law in the appointment of
the appellant.

The official memorandum dated 23 .12.1994 on a plain reading of it
applies only to Government servants. It has no manner of the application to B
the employees or servants of the statutor; boards. The appellant is not a
retired government servant. His appointment as Managing Director of the
Board is not a post in Government service. The High Court has erred in law
in applying the said official memorandum to the appointment of the appellant
which is governed only by the Act and the Rules, even otherwise the High C
Court has failed to appreciate that the official memorandum running counter
to the statutory provisions are ineffective and at any event cannot be enforced
.• in a quo warranto proceedings .

The appellarit joined the services of the State in the public health
engineering segment of its Power Works Department in the year 1967. From D
the time, the Karnataka Urban Water Supply & Drainage Board was established
in the year 1975, he has been working in the Board having initially been
appointed to its services as Assistant Engineer, thereafter, absorbed in its
services and by his consistently good performance and unblemished record
reached the post of Chief Engineer of the Board. He has apart from about 34
years of experience in development, establishment, maintenance and E
management of drinking water and drainage facilities in the urban areas has
undergone several training programmes abroad in planning, appraisal
implementation of water and sanitation projects and management development
programme for senior public health engineers.
F
Section 4(2) of the Act, 1973 mandates that the Managing Director shall
possess the prescribed qualification and he shall be appointed by the
Government. Rule 3 of the Rules, 1974 prescribes the qualification for
appointment of Managing Director in these words:

"The Managing Director shall be a person having experience m G
administration and capacity commercial matters."

There was not even a pleading that the appellant does not have experience
in administration and capacity in commercial matters. The appointment of the
appellant has been made by the Government in exercise of powers conferred
on it by Section 4(2) of the Act. The High Court does not dispute the power H
484 SUPREME COURT REPORTS [2006) SUPP. 5 S.C.R.

A of the Government to make the appointment. Mr. Raju Ramachandran, learned
senior counsel for the Union does not dispute that the power of the Government
to make contractual appointment. A perusal of the judgment of the High Court
would only go to show that the High Court did not record any finding that
the appellant does not possess the qualification prescribed by the acts and
B rules. The disqualification for appointment as a Director of the Board are set
out in Section 7 of the Act. The only disqualification that the appellant
suffered was under Section 7(l)(d) of the Act. He being an employee of the
Board and this disqualification disappeared on 31.01.2004 when the appellant
retired from service of the Board on superannuation. The High Court having
regard to the technical nature of quo warranto proceedings could not have
C ousted the appellant from the office on the ground of an inapplicable
qualification prescribed by administrative instruction dated 23 .12.1994 which
had no manner of application for appointment to the post of Managing
Director of the Board.

The law is well settled. The High Court in exercise of its writ jurisdiction
D in a matter of this nature is required to determine, at the outset, as to whether
a case has been made out for issuance of a Writ of Quo Warranto. The
jurisdiction of the High Court to issue a Writ of Quo Warranto is a limited
one which can only be issued when the appointment is contrary to the
statutory rules.

E The official memorandum dated 23.12.1994 deals with re-appointment of
retired government servants and granting extension of service to retired
government servants. As already stated, the appellant is not a government
servant nor a retired government servant. The official memorandum is an
administrative instruction which is contrary to the provisions of the Act and
p statutory Rules neither the Act nor the Rules prescribe any age of retirement
for the Managing Director of the Board. On the other hand, having regard to
the dis-qualification prescribed by Section 7(1 )(d) of the Act to the effect that
an officer or servant of the Board cannot be appointed as Managing Director. <( •

The High Court could not have read an additional dis-qualification that a
retired officer or a servant of the Board also cannot be appointed as Managing
G Director of the Board. The memorandum' dated 23.12.1994 is no manner of
application to the appointment in question and it is even otherwise ineffective
inasmuch as it is an administrative instruction which is contrary to the
provisions of the Act and the Rules. The High Court, in our opinion, erred
in ousting the appellant from his service by issue of a Quo Warranto on the
H ground that the appellant having retired from this service of the Board on
B. SRINIVASA REDDY r. KARNATAKA URBAN WATER SUPPLY&: ORAINAGE BOARO EMP. ASSON. jLAKSHMANAN.J.I 485

31.01.2004 suffered dis-qualification under the said memorandum by a reading A
of the Act and the Rules the appellant acquired qualification for appointment
on 31.01.2004 on his retirement and the view of the High Court that the
appellant is dis-qualified on 31.01.2004 on his retirement from service of the
Board is not only contrary to the Act and the Rules is also plainly opposed
to the language of the memorandum itself. Even otherwise, no Writ of Quo B
Warranto could have been issued on the ground that even though the
appointment is contrary to any statutory rule it is contrary to the administrative
instruction which the High Court holds as disclosed the policy of the
Government. There is no warrant to have taken such a view at all.

It is settled law by a catena of decisions that Court cannot sit in C
judgment over the wisdom of the Government in the choice of the person to
be appointed so long as the person chosen possesses prescribed qualification
and is otherwise eligible for appointment. This Court in R.K. Jain v. Union
of India, [1993] 4 SCC 119 was pleased to hold that the evaluation of the
comparative merits of the candidates would not be gone into a public interest
litigation and only in a proceeding initiated by an aggrieved person, it may D
be open to be considered. It was also held that in service jurisprudence it is
settled law that it is for the aggrieved person that is the non-appointee to
assail the legality or correctness of the action and that third party has no
locus standi to canvass the legality or correctness of the action. Further, it
was declared that only public law declaration would be made at the behest E
of public spirited person coming before the Court as a petitioner having
regard to the fact that the neither of respondent Nos. I and 2 were or could
have been candidates for the post of Managing Director of the Board and the
High Court could not have gone beyond the limits of Quo Warranto so very
well delineated by a catena of decisions of this Court and applied the test
which could not have been applied even in a certiorari proceedings brought F
before the Court by an aggrieved party who was a candidate for the post.
,, The judgment impugned in this appeal not only exceeds the limit of Quo
Warranto but has not properly appreciated the fact that writ petition filed by
the Employees' Union and the President of the Union - Halakatte was
absolutely lacking in bonafides. In the instant case, the motive of the second G
respondent Halakatte is very clear and the Court might in its discretion
declined to grant a Quo Warranto.

This Court in A.N. Sashtri v. State of Punjab and Ors., [1988] Supp SCC
127 held that the Writ of Quo Warranto should be refused where it is an H
486 SUPREME COURT REPORTS (2006] SUPP. 5 S.C.R.

A outcome of malice or ill-will. The High Court failed to appreciate that on
18.01.2003 the appellant filed a criminal complaint against the second respondent
-
Halakatte that cognizance was taken by the criminal court in CC No. 4152 of
2003 by the jurisdictional magistrate on 24.02.2003, process was issued to the
second respondent who was enlarged on bail on 12.06.2003 and the trial is
B in progress. That apart, the second respondent has made successive complaints
to the Lokayukta against the appellant which were all held to be baseless and
false. This factual background which was not disputed coupled with the fact
that the second respondent Halakatte initiated the writ petition as President
of the 1st respondent Union which had ceased to be a registered trade union
as early as on 02.11.1992 suppressing the material fact of its registration
C having been cancelled, making allegations against the appellant which were
no more than the contents of the complaints filed by him before the Authorities
which had been found to be false after thorough investigation by the Kamataka
Lokayukta would unmistakably establish that the writ petition initiated by the
respondent Nos. 1 and 2 lacked in bona fides and it was the outcome of the
malice and ill-will the 2nd respondent n:irses against the appellant. Having
D regard to this aspect of the matter, the High Court ought to have dismissed
the writ petition on that ground alone and at any event should have refused
to issue a Quo Warranto which is purely discretionary. It is no doubt true that
the strict rules of locus standi is relaxed to an extent in a Quo Warranto
proceedings. Nonetheless an imposture coming before the Court invoking
E public law remedy at the hands of a Constitutional Court suppressing material
facts has to be dealt with firmly.

This Court in Dr. B. Singh v. Union of India and Ors., [2004] 3 SCC 363
held th~t only a person who comes to the Court with bonafides and public
interest can have locus. Coming down heavily on busybodies, meddlesome
F interlopers, wayfarers or officious interveners having absolutely no public
interest except for personal gain or private profit either of themselves or as
a proxy of others or for any other extraneous motivation or for glare of
P.ublicity, this Court at para 14 of the report held as under:-

"The court has to be satisfied about: (a) the credentia!s of the applicant;
G (b) the primafacie correctness or nature of information given by him;
and (c) the information being vague and indefinite. The information
should show gravity and seriousness involved. Court has to strike a
balance between two conflicting interests: (i) nobody should be allowed
to indulge in wild and reckless allegations besmirching the character
H of others; and (ii) avoidance of public mischief and to avoid
-
B. SRINIVASA REDDY r. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. ILAKSHMANAN. J.I 487

mischievous petitions seeking to assail, for oblique motives, justifiable A
executive actions. In such case, however, the court cannot afford to
be liberal. It has to be extremely careful to see that under the guise
of redressing a public grievance, it does not encroach upon the
sphere reserved by the Constitution to the executive and the legislature.
The court has to act ruthlessly while dealing with imposters and
busybodies or meddlesome interlopers impersonating as public spirited B
holy men. They masquerade as crusaders of justice. They pretend to
act in the name of pro bona publico, though they have no interest
to the public or even of their own to protect."

It is useful to refer4o the case of The University of Mysore and Anr. C
v. C.D.Govinda Rao and Anr., (1964] 4 SCR 575 at pages 580 and 581

"As Halsbury has observed:

"An information in the nature ofa quo warranto took the place of the
obsolete writ of quo warranto which lay against a person who claimed
or usurped an office, franchise, or liberty, to inquire by what authority D
he supported his claim, in order that the right to the office or franchise
might be determined."

Broadly stated, the quo warranto proceeding affords a judicial remedy
by which any person, who holds an independent substantive public
office or franchise or liberty, is called upon to show by what right he E
·holds the said office, franchise or liberty, so that his title to it may be
duly determined, and in case the finding is that the holder of the office
has not title, he would be ?usted from that office by judicial order. In
other words, the procedure of quo warranto gives the Judiciary a
weapon to control the Executive from making appointment to public F
office against law and to protect a citizen from being deprived of
public office to which he has a right. These proceedings also tend to
, protect the public from usurpers of public office, who might be allowed
to continue either with the connivance of the Executive or by reason
of its apathy. It will, thus, be seen that before a person can effectively
claim a writ of quo warranto, he has to satisfy the Court that the G
office in question is a public office and is held by a usurper without
legal authority, and that inevitably would lead to the enquiry as to
whether the appointment of the alleged usurper has been made in
accordance with law or not."
H
488 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A It is also beneficial to refer to the decision of this Court in Ghulam
Qadir v. Special Tribunal and Ors., [2002] I SCC 33 para 38 which reads
thus:-

"There i~ no dispute regarding the legal proposition that the rights
under Article 226 of the Constitution of India can be enforced only
B by an aggrieved person except in the case where the writ prayed is
for habeas corpus or quo warranto. Anot.her eKception in the general
rule is the filing of a writ petition in public interest. The existence of
the legal right of the petitioner which is alleged to have been violated
is the foundation for invoking the jurisdiction of the High Court under
the aforesaid Article. The orthodox rule of interpretation regarding the
c locus standi of a person to reach the court has undergone a sea-
change with the development of constitutional law in our country and
the constitutional courts have been adopting a liberal approach in
dealing with the cases or dis-lodging the claim of a litigant merely on
hyper-technical grounds. If a person approaching the court can satisfy
D that the impugned action is likely to adversely affect his right which
is shown to be having source in some statutory provision, the petition
filed by such a person cannot be rejected on the ground of his having
not the locus standi. In other words, if the person is found to be not
merely a stranger having no right whatsoever to any post or property,
he cannot be non-suited on the ground of his not having the locus
E standi.

It is settled law that Writ of quo warranto does not lie if the alleged
violation is not of a statutory nature. Three judgments relied on by Mr. P.P.
Rao can be usefully referred to in the present context.
F In A. Ramachandran v. A. Alagiriswami, Govt. Pleader High Court,
Madras & Anr.. AIR (1961) Madras 450, the Court observed in paragraphs
74 and I04 as under:

" .... Where an authority has power to make rules relating to a
subject matter and also the power to decide disputes arising in the
G field occupied by that subject matter, the two powers and functions
must be kept distinct and separate. This dispute must be decided with
reference to the rules in force at the time the adjudication had to be
made and, the rule making power cannot be invoked in relation to that
adjudication."
H
...

B. SRINIVASA REDDY r. KARNATAt.:A URBAN WATER SUPPLY It DRAINAGE BOARD EMP. ASSON. fLAKSHMANAN. J.] 489
• " ....... It was also contended that it was incumbent on the State A
Government to follow the principle of appointment as laid down in
1932 C.O. so as to avoid arbitrariness of nepotism. Reliance was
placed upon the decision in 1955-2 Mad LJ 49: (AIR 1955 Mad 305)
(FB) for the position that even non-statutory regulations and rules
contained in the Board's Standing Orders are binding on the State
Government, and that it cannot depart from such rules arbitrarily and
B
capriciously to suit the exigencies of a particular situation. In that
case the Government purported to exercise a revisional power over the

- Orders of the Board of Revenue which it did not have as per Board's
Standing Orders count at any time be modified or amended and that
if the Government had power to bring about such modifications it
followed that the Government had power of revision though in terms
c
such power was not conferred upon it."

In High Court of Gujarat & Anr. v. Gujarat Kishan Mazdoor Panchayat
& Ors., [2003] 4 SCC 712, it was held by this Court that a Writ of Quo
Warranto can only be issued when the appointment is contrary to the statutory D
rules. The judgment in Mor Modern Coop. Transport Society ltd. v. Financial
Commissioner & Secretary to Government of Haryana, [2002] 6 SCC 269 was
also relied on.

Thus it is seen that Writ of Quo Warran/a does not lie if the alleged
violation is not of a statutory provision. E

The Official Memorandum of 1994 dated 23.12.1994 of the Government
of Karnataka reads thus:

"GOVERNMENT OF KARNATAKA"
F
No. DPAR/15/SDE 94
Karnataka Government Secretariat
Vidhana Soudha
. Bangalore dated 23.12. 1994
OFFICIAL MEMORANDUM
G
Sub: Regarding re-appointment of retired Government Employee and
extension of their services after Retirement.
Ref: (i) O.M. No. DPAR 42 SSR 77 dated 15.12.1977
(ii) O.M. No. DPAR No. 2 SOE 90 dated 22.02.1990
H
490 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A I. In the O.M. referred at ( 1) above in respect of the teaching staff
vi:., Teachers, Lecturers, Professors who are working in
educational institutions of the Education Department retiring in
the middle of the academic year, it was permitted to continue their
services till the end of the educational year with the permission
of the concerned office,.,
B
2. In the O.M. referred at (2) above, it was instructed not to re-
appoint the retired Government servants and not to give them
extension of service.
3. It has come to the notice of Government that retired Government
c officers/officials have been re-appointed on contact basis. Hence
it is ordered that the officers/officials who have been re-appointed
on contract basis and continuing in service shall be removed
from service forthwith.
4. If the teaching staff working in educational institutions of the
D Education Department are retiring in the middle of the academic
year, the instructions given in O.M. No. DPAR 42 SSR 77 dated
15.12.1977 are applicable.
5. The procedure contained in the above paragraphs are also
applicable to the Autonomous/Grant-in-Aid institutions, Boards
and the Companies which are subordinate to or under the control
E
of the Government."

Sd/-
(A.V. Ramamurthy)
Joint Secretary to Government
F D.P.A.R. (SR)"
Paragraph 5 of the Memorandum makes it amply clear that Boards are included
within the said memorandum and hence the procedure adopted for Government
employees will equally apply to the Board. The initial appointment of the
appellant as Managing Director was on 28.1.1998. He was relieved vide relieving
G Order dated 3 l. t.2004 as M.D. His pension order stated that he has retired
as M.D. Thereafter he was re-appointed as M.D. on 31.1.2004. The said
Notification reads as follows:

"In exercise of the powers conferred under Section 4(2) of the
KUWS&D B Rules, 1973 (Kamataka Act 25/1974) Sri B. Srinivasa
H Reddy, No. 427 12th Main, RMV Extension, Bangalore-560 080 is
B. SRINl\IASA REDDY v. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP ..>\SSON. ILAKSHMANAN. J.I 491

appointed as Managing Director, KUWS&D Bon contract basis w.e.f. A
01.02.2004 until further orders.

The terms and conditions will be issued separately."

Therefore, the official memorandum squarely applies to the appellant.
B
In Union of India v. K. P. Joseph & Ors., [1973] 1 SCC 194, it was held
by this Court that administration instructions made to fill gaps or to supplement
the statutory rules and affecting conditions of service would be binding and
enforceable by Writ under Art. 226 of the Constitution of India.

A close scrutiny of the official memorandum would show that it is C
restrictive to appointment to any post but as a general application to all the
posts and that the intention of the memorandum is that retired person should
not be appointed again.

No violation of Section 4(2) of the Act and Rule 3 of the Rules:
D
There is no violation of Section 4(2) and Rule 3 as held by the High
Court because the appellant having been the Chief Engineer of the Board had
experience in administration and capacity in commercial matters before he was
appointed as M.D. on contract basis by the Government. Section 4(2) of the
Act reads as under:
E
"4(2) The Chairman and the Managing Director shall possess the
prescribed qualification. They and the other directors shall be appointed
by the Government."

Rule 3 of the Rules deals with Qualification for appointment of the
Chairman and the Managing Director. F
Rule 3 reads thus:

"The Chairman shall be a person having experience in matters
concerning public welfare. The Managing Director shall be a person
having experience in Administration and capacity in commercial G
matters."

In this context, it is useful to peruse the original file produced by Mr.
Sanjay R. Hegde, learned counsel appearing for the State, before us. A note
was prepared by the Secretary to Government, Urban Development Department,
~ in regard to the appointment of M.D. of the Board: H
492 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A "Subject : Appointment of Managing Director of KUWSDB
I. Shri B. Srinivasa Reddy, Managing Director ofKUWSD will retire
from service on 31.1.2004.\
2. As per Section 4(2) of the Karnataka Urban Water Supply and
Drainage Board Act, 1973, the Managing Director shall be
B appointed by the government as per Section 6(1 ). He shall hold
office during the pleasure of the government. As per Rule 3 of
the KUWSDB Rules 1974, the Managing Director shall be a
person having experience in administration and capacity in
commercial matters. As per KUWSDB Rule 4(2), the Managing
c Director shall be a whole time officer of the Board and shall be
paid remuneration as prescribed.
3. Therefore, it is necessary for the Government to appoint the
Managing Director. The Managing Director can be a serving
Officer of the Government who can be sent on deputation to the
D KUWSDB. It is even open to the Government to appoint a retired
official to the post of Managing Director. But generally
Government has not appointed any retired official either to
KUWSDB or other Boards and Corporations of the Government.
4. A decision has to be ql'ickly taken as the Managing Director of
KUWSDB has to hold negotiations with the World Bank on
E
9.2.2004 regarding the new Water Supply and Sanitation
Improvement Programme.
5. In my view, an Engineer in water supply/public health engineering
would be most ideal for the post of Managing Director,
KUWSDB."
F
The file was placed before Shri S.M. Krishna, Chief Minister. The order
passed by the Chief Minister is at page 2 of the File which reads thus:

"This is a critical juncture for Karnataka Urban Water Supply and
Sewerage Board. Considering the projects on hand and the need to
G

-
complete them within a definite time frame, there should be continuity
in leadership and management. The services of Shri B. Srinivasa
Reddy, are need for the present.

Shri Srinivasa Reddy' s continuation will help in the important
negotiations with the World Bank scheduled t-0 be held in February,
H
B. SRINJVASA REDDY 1·. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. ILAKSHMANAN.J.I 493

regarding the new Water Supply and Sanitation programme. A
Considering the adverse seasonal conditions prevailing and
prolonged drought, there is likelihood of severe water scarcity in
urban areas in the coming months. For this, a sum of Rs.15 crores by
way of relief has been earmarked in the period February to June 2004.
The Urban Water Supply Board will be required to augment water B
availability, especially in chronic places like Bagalkot, Pavagada and
Hubli-Dharwad. For planning and executing these contingency
measures, Shri Srinivasa ~eddy's presence is essential.

Shri Srinivasa Reddy who has retired today may be appointed on
Contract basis from 1.2.2004 until further orders." C
It is thus seen that the Chief Minister after considering the relevant
material, experience in administration and capacity in commercial matters of
the appellant accepted the office note put up by the Secretary to Government
and appointed a retired official to the post of M.D. Ample reasons are given
for considering the name of the appellant and the consequential appointment D
made by the Government.

In the instant case, there is no violation of statutory provision and,
therefore, in our view, a writ of Quo Warranto does not lie. If there be any
doubt, it has to be resolved in favour of uphold.ing the appointment. E
In Statesman (Private) Ltd v. H.R. Deb, [1968] 3 SCR 614, Hidyatullah,
C.J., speaking for the Constitution Bench indicated:

"The High Court in a quo warranto proceeding should be slow
to pronounce upon the matter unless there is a clear infringement of F
the law."

In the circumstances which we have narrated above in paragraphs
supra, it is indeed difficult to hold that the appellant did not have the requisite
qualification.

The above ruling was followed in A.N. Shashtri v. State of Punjab & G
Ors., [1988] Supp SCC 127. We are of the view that in the facts of this case,
the reasonable conclusion to reach should have been that the writ petitioners
had failed to establish that the appellant did not possess requisite qualification
I
and the appeals are, therefore, be allowed and the judgment of the High Court
has to be set aside and the writ petition has to be dismissed. H
494 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A The finding of disqualification given in the earlier round of litigation
while the appellant was holding a lien on the post of Chief Engineer i.e. while
he was an officer of the Board, ceased to hold good after the appellant retired
from the service of the Board on 31.1.2004 (AN) and the appointment impugned
in the second round of litigation was effective from 1.2.2004 after the appellant
hc>.d ceased to be an officer of the Board.
B
Contractual appointment/powers of the Government

Mr. Raju Ramachandran, learned senior counsel appearing for the Trade
Union, fairly conceded that the Government has unrestricted power to make
C contractual appointment. Even otherwise, the Government, in our opinion, has
the undoubted power to make a contractual appointment until further orders.
The finding to the contrary is ex facie erroneous.

The Notification dated 31.1.2004 clearly states that the appointment is
on contract basis and until further orders. While laying down the terms of
D appointment in its order dated 21.4.2004, the Government of Karnataka clearly
. stated that "term of contractual appointment of Sri B. Srinivasa Reddy shall
commence on 1st February, 2004 and will be in force until further orders of
the Government and this is a temporary appointment." Section 6(1) of the Act
categorically states that the Managing Director shall hold office during the
pleasure of the Government. Power and functions of the Board are laid in
E Chapter V of the Act. A reading of the Act clearly shows that neither the
Board nor its Managing Director is entrusted with any sovereign function.
Black's Law Dictionary defines public office as under:

"Public Office: Essential characteristics of "public office" are (I)
authority conferred by law, (2) fixed tenure of office, and (3) power to
F exercise some portion of sovereign functions of government, key
element of such test is that "officer" is carrying out sovereign function.
Spring v. Constantion, 168 Conn.563, 362 A.2d 871, 875. Essential
elements to establish public position as "public office" are position
must be created by Constitution, legislature or through authority
conferred by legislature, portion of sovereign power of government
G
must be delegated to position, duties and power must be delegated
to position, duties and powers must be defined, directly or impliedly,
by legislature or through legislative authority, duties must be performed
-
independently without control or superior power other than law, and
position must have some permanency and continuity, State ex rel. E.li
H Lil~v & Co. v. Gaertner, Mo.App 619 S.W. 2d 6761, 764."
B. SRINIVASA REDDY 1·. KA.RNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. ILAKSHMANAN.ll 495

Carrying out sovereign function by the Board and delegation of a A
portion of sovereign power of Government to the Managing director of the
Board and some permanency and continuity in the appointment are
quintessential features of public office. Every one of these ingredients are
absent in the appointment of the appellant as Managing Director of the
Board. This aspect of the matter was completely lost sight of by the High B
Court.

The High Court, in the instant case, was not exercising certiorari
jurisdiction. Certiorari jurisdiction can be exercised only at the instance of
a person who is qualified to the post and who is a candidate for the post.
This Court in Dr. Umakant Saran v. State ofBihar, [1973) l SCC 485 held that C
the appointment cannot be challenged by one who is himself not qualified to
be appointed. In Kuman· Chitra Ghose v. Union of India, [1969) 2 SCC 228,
a Constitution Bench of this Court held as under:

"The other question which was canvassed before the High Court
and which has been pressed before us relates to the merits of the D
nominations made to the reserved seats. It seems to us that the
appellants do not have any right to challenge the nominations made
by the Central Government. They do not compete for the reserved
seats and have no locus standi in the matter of nomination to such
seats. The assumption that if nominations to reserved seats are not
in accordance with the rules all such seats as have not been properly E
filled up would be thrown ~pen to the general pool is wholly ·
unfounded."

But the High Court of Delhi in P.L. Lakhanpal v. Ajit Nath Ray, AIR (1975)
Delhi 66 held as under:
F
"Another facet of the preliminary objection relates to the allegations
of ma/a fides made in the petition. It will bear repetition to state that
the preliminary objection is on the assumption and not admission that
the appointment of Justice A.N. Ray was ma/a fide. It is indisputable
that mala fide action is no action in the eye of law. But, to my mind, G
the ma/a /ides of the appointing authority or, in other words, the
motives of the appointment authority in making the appointment of a
particular person are irrelevant in considering the question of issuing
a writ of quo warranto ....."

The discretion available to the competent authority under the Rules has H
496 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A been exercised by the appointing authority in making the appointment of the
appellant. That could not have been annulled by the High Court. In Writ
Petition No. 44001 of 2005 decided on 12.4.2002, the very High Court had
directed the Government by a direction akin to mandamus to immediately take
steps to appoint the Managing Director of the Board in accordance with the
B Act and the Rules. The present appointment of the appellant was made under
the provisions of the Act and the Rules. This appointment could not have
been interdicted by a writ of Quo Warranto as it amounted to issuance of writ
of Quo Warranto to disobey the mandamus already issued and is in operation.
Such a course adopted by the High Court is contrary to law declared by this
Court Rajendra Prasad Yadav v. State of Madhya Pradesh, (1997] 6 SCC 678.
c In Salish Chandra Anand v. Union of India, [ 1953] SCR 655, a
Constitution Bench of this Court while dealing with a case of a contract
appointment which was being terminated by notice under one of its clauses,
this Court held that Articles 14 & 16 had no application as the petitioner
therein was not denied equal opportunity in a matter relating to appointment
D or employment who had been treated just like any other person to whom an
offer of temporary employment under these conditions was made. This Court
further held as under:

"The State can enter into contracts of temporary employment and
impose special terms in each case, provided they are not inconsistent
E with the Constitution, and those who choose to accept those terms
and enter into the contract are bound by the111, even as the State is
bound."

In P.K. Sandhu (Mrs.) v. Shiv Raj V. Patil, [ 1997] 4 SCC 348, it was held
F by this Court as under:

"The power to make an appointment includes the power to make
an appointment on substantive basis, temporary or officiating basis,
ad hoc basis, on daily wages or contractual basis."

Legal Malice:
G
It was argued by Mr. Raju Ramachandran, learned senior counsel
appearing for the respondents, that there was no reason for the State to re-
appoint the appellant on the post of M.D., specially in view of the following
facts:

H
B. SRINIVASA REDDY v. K..\RNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. fLAKSHMANAN. J.1 497

(i) His initial appointment to Managing Director on 28.01.1998 was A
admittedly in contravention of Section 7(l)(d) of the Act. Yet, he
continued till 31.1.2004. He, thereafter, withdrew his appeal thereby
confirming that his entire tenure as M.D. from 1998 to 2004 was
illegal and in contravention of the Act.
(ii) He was relieved from his duty as "Managing Director" and is B
receiving pension accordingly.
(iiO Reports pertaining to malpractices committed by the petitioner of
which he has not exonerated so far reveal that he is not a person
with an undoubtful character.
(iv) List of persons appointed at the post of Managing Director of c
the Board since its inception show that only !AS Officers or
PWD officials have been appointed at this post. For the first time,
a retired Board servant was brought as the Managing Director for
"until further orders".
(v) The note sheet of the Chief Minister, though proposes certain D
exigencies, do not indicate that he is the only person who can
cater to such demands.
(vi) There was no need for an appointment for "until further orders"
where admittedly, the purpose of appointment would have been
accomplished at the most by June,2004. E
According to him something was done by the State without excuse and
that it is an act done wrongfully and wilfully without reasonable or probable
cause. He also referred to the findings of the High Court on legal malice.

In our opinion, the finding of legal ma/a fides is unsustainable being F
based on a misunderstanding of the law and facts. When a competent and
.. experienced officer of an outstanding medt is appointed to a higher post on
contract basis after his super-annuation from service in larger public interest
does not suffer from legal malice at all. The decision of the then Chief
Minister, Shri S.M. Krishna, recorded in the file which is also extracted by the G
High Court at page 69 ofS.L.P. Paper book, Vol.II. In the context of the note
put up by the Secretary of the Department, it is again extracted at pages 67
& 68 which clearly bring out the fact that the appointment was made in the
interest of the Board and the State at a time when nobody else other than
the appellant could have served the interests of the State better. The High
Court• failed to appreciate the element of urgency involved in making the H
498 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A appointment because of impending n~gotiations with the World Bank scheduled
for 9.2.2004. The writ petition, in our opinion, was motivated as respondent
No. I had lodged a false complaint to the Lokayukta against the appellant
which was found to be baseless by the Lokayukta (Annexure P-9). A petition
praying for a Writ of Quo Warranto being in the nature of public interest
B litigation, it is not maintainable at the instance of a person who is not
unbiased. The second respondent is the President of the first respondent-
Union. He has chosen this forum to settle personal scores against his erstwhile
superior officer after his retirement. The proceedings, in our view, is not meant
to settle personal scores by an employee of the department. The High Court,
in our view, ought to have dismissed the writ petition filed by respondent
C No. I at the threshold.

In any event, respondent No. I failed to discharge the heavy burden to
substantiate the plea of ma/a fides (E.P. Royappa v. State of Tamil Nadu,
[I 974) 2 SCR 348.

D The finding of the High Court that the appointments from legal ma/a
jides is wrong. The Court relied on the judgment in Centre for Public Interest
Litigation & Anr. v. Union of India & Anr., (2005) 8 SCC 202. It was a case
of appointment of an officer against whom criminal proceedings were pending
even the Commission will look into the charges against the officer, therefore,
the above ruling has no application at all in the present case.
E
The Division Bench noted that certain allegations were made against
the appellant and observed in paragraph 3 that the comphint was stated to
be pending before the Lokyukta in the matter relating to financial irregularities
of the Board and that the Comptroller and Auditor General submitted a report
F for the year ending 3 I .3.2000 wherein the appellant has paid the amounts to
contractor even before they became due resulting in loss of interest of
Rs.15.40 lakhs to the Board. However, the Division Bench did not take notice
of that fact that Lokayukta had completely exonerated the appellant. •
Until fi1rther orders
G Mr. Raju Ramachandran, learned senior counsel appearing for the
respondents, submitted that the pleasure of the Government and discretion
cannot be completely discretionary and at the ipse dixit of the exe.cutive.
Even a contractual appointment has to be made with a certain ascertainable
period and cannot be open-ended. According to him, use of words "until
H
B. SRJNIVASA REDDY 1•. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. !\SSON. jLAKSHMANAN.J.I 499

further orders" is not a safety notch but is rather prone to misuse. Even in A
the constitutional scheme, under Chapter XIV of the Constitution, a contractual
~ppointment presumes a specific period. Art 310(2) of the Constitution provides

.· that:

"(2) Notwithstanding that a person holding a civil post under the
Union or a State holds office during the pleasure of the President or, B
as the case may be, of the Governor of the State, any contract under
which a person, not being a member of a defence service or of an all-
India service or of a civil service of the Union or a State, is appointed
under this Constitution to hold such a post may, if the President or
the Governor, as the case may be, deems it necessary in order to C
secure the services of a person having special qualifications, provide
for the payment to him of compensation, if before the expiration of an
agreed period that post is abolished or he is, for reasons not connected
with any misconduct on his part, required to vacate that post"

In EP. Royappa v. State a/Tamil Nadu and Anr. (supra), further question D
before us is whether the appointment made by the Government includes any
component of ma/a }ides. The burden of establishing ma/a }ides is very
heavy on the person who alleges it. The allegations of ma/a }ides are often
more easily made than proved, and the very seriousness of such allegations
demands proof of a higher order of credibility. Here respondents I & 2 have
flung a series of charges of oblique conduct against the then Chief Minister E
through their advocate. The anxiety of the Court should be all the greater to
insist on a high decree of proof. The Court would, therefore, be slow to draw
dubious inferences from incomplete facts placed before it by a party, particularly
when the imputations are grave and they are made against the holder of an
office which has a high responsibility in the administration. F
This Court, in the above judgment, held that such is the judicial
perspective in evaluating charges of unworthy conduct against ministers and
other high authorities, not because of any special status which they are
supposed to enjoy, nor because they are highly placed in social life or
administrative set up, these considerations are wholly irrelevant in judicial G
approach-but b~cause otherwise, functioning effectively would become difficult
in a democracy.

Two important considerations must weigh with us in determining our
approach to these questions. First, the post of Managing Director is a highly
respectable post. It is a post of great confidence - a lynchpin in the H
500 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A administration and smooth functioning of the administration 1equires that
there should be complete rapport and understanding between the Managing
Director and the Chief Minister. The Chief Minister as a Head of the
Government is in ultimate charge of the administration and it is he who is
politically answerable to the people for the achievements and failures of the
B Government. If the Chief Minister forfeits the confidence on the appellant, he
may legitimately in the larger interests of administration appoint him until
further orders as M.D. of the Board. It does not involve violation of any legal
or constitutional rights. Secondly that the vast multitudinous activities in
which a modern State is engaged, there are bound to be some posts which
require for adequate discharge of their functions, high degree of intellect and
C specialized experience. It is always a difficult problem for the Government to
find suitable officers for such specialized posts. There are not ordinarily many
officers who answer the requirements of such specialized posts and the
choice with the Government is very limited and this choice becomes all the
more difficu It, because some of these posts, though important and having
onerous responsibilities, do not carry wide executive powers and officers may
D not, therefore, generally be willing to he transferred to those posts. The
Government has in the circumstances to make the best possible choice it can,
keeping in view the larger interests of the administration. When in exercise
of this choice, the Government transfers an officer from one post to another,
the officer may feel unhappy because the new posts does not give him the
E same ampiitude of powers which he had while holding the old post. But that
does not make the appointment arbitra;y. So long as the appointment is made
on account of the exigencies of administration, it would be valid and not open
to attack under Arts. 14 & 16. Here the post of M.D. was admittedly a
selection post and after careful examination of the merits, the Chief Minister
selected the appellant for the post of M.D. It was not the case of the
F respondents that the appellant was not found qualified to the task or that his
work was not satisfactory.

It was argued by Mr. P.P. Rao, learned senior counsel, appearing for the
appellant that the Division Bench while answering Point No.2 in paragraph
G 25 that the order of appointment passed by the State Government is not a
regu Iar appointment. It has further been observed that Section 4(2) of the Act
and Rule 3 of the Rules framed do not permit the Government to appoint the
Managing Director on contractual basis. It was submitted that the finding of
the Division Bench as well as the single Judge are legally unsustainable. The
Act makes clear distinction between appointments to the Board and
H appointment of Officers and servants of the Board. All appointments of
8. SRINIVASA REDDY r. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. ASSON. JLAKSHMANAN. J.I 501

Directors are "appointments at the pleasure of the Government". He drew our A
attention to Section 6(1) of the Act which reads thus:

"6( 1) All directors including the Chairman and the Managing Director
shall hold office during the pleasure of the Government. The expression
'contract basis' is only to indicate that the appointment was to subsist
till the withdrawal of the pleasure of the Government. It could not be B
said that the contractual appointment is made contrary to the Rules
that contemplate regular appointment."

It is pertinent to point out that there are no separate conditions of
service or tenure prescribed for 'Directors', which expression under the Act
includes the Managing Director. Appointments at the pleasure of the C
Government are not the same as ordinary appointments. It was further submitted
that ordinary principles of recruitment applicable to posts governed by Chapter
I of Part XIV of the Constitution of India would not apply to the instant
appointment being an appointment at the pleasure of the Government. This
is also for the simple reason that ordinary appointments in public service D
entail security of tenure which has an essential feature of such appointment.
These characteristics are noticeably absent in the instant case.

Our attention was also drawn to the conclusion reached by the High
Court that the appellant was not. qualified for the post and under Rule 3 of
the Rules, the qualification for appointment is explicitly provided. No age of E
retirement is prescribed for Director including Maniiging Director. Neither any
age limit for appointment is prescribed. These qualifications do not prescribe
any age limit. Section 8 of the Act itself suggests that even a legal practitioner
could be appointed as a Director. The only limitation or disqualification is with
regard to a serving officer or servant of the Board from being appointed as
Director. Section 7( 1)( d) does not apply to an officer or servant who ceased F
to be such on the date of his appointment as Managing Director. Section 7
stipulates all disqualifications for appointment as Director. It is not the case
of the contesting respondent that the appellant was disqualified from holding
the post on any other grounds.
G
Our attention was also drawn to the judgment of the Division Bench
holding that the State Government and the Board could not have filed an
appeal against che order of the learned single Judge. Reference has been made
to the judgment of this Court in B.R. Kapur v. State of Tamil Nadu and Anr.,
[200 I] 7 SCC 231. The said judgment is wholly in applicable to this case
inasmuch the issue therein did not pertain to the appointment under service H
502 SUPREME COURT REPORTS (2006) SUPP. 5 S.C.R.

A Rules. In the said case, no question relating to the issuance of Writ of Quo
Warranto pertaining to service jurisprudence was involved. That case related
to appointment by the Governor of a person convicted of a criminal offence
by which she stood disqualified under the provisions of the Representation
of Peoples Act, 1951. Moreover, the Writ of Quo Warran/a in that case was
B issued in the light of several provisions of the Prevention of Corruption Act,
the Representation of Peoples Act, 1951 and various other enactments which
clearly prohibited the appointment of a convicted person to a public office.
There is no legal postulation in the said judgment which seeks to restrain any
interested party from challenging a judgment. In the instant case, the appellant
did not solicit or engineer his appointment. His appointment was at the
C instance of the State Government in accordance with provisions of the Act
and the Rules. The State Government has power to take its own decision for
deciding on a suitable candidate for appointment as long as the eligibility
criteria was satisfied. The appointment in the instant case is not one of
recruitment, but of a different species of appointment for rendering services.
It is more in the nature of a contract for service. This is specially required
D considering fact that the functions of the Board are essentially technical in
nature as would be evident from a perusal of Sections 16 & 17 of the Act.

At any event implicit in the finding of the Division Bench that the
appointing authority has no right to appeal in Quo warranto proceedings is
E that the Court cannot probe the mind of the appointing authority in a motion
for Quo Warranto. The High Court erred in probing the mind of the government
and acted contrary to its own finding on the role of appointing authority in
Quo Warranto proceedings. The reasons felt out by the learned Judges of the
Division Bench are not sustainable in law and the impugned judgment is liable
to be interfered with in these appeals. The learned Judges ate not right in
F quashing the appointment of the appellant as Managing Director on the
misconception that he has been re-appointed to the said office, whereas it
was a fresh appointment under the provisions of the Act and in accordance
with the prescribed qualification and eligibility under the Act. Further the
appointee holds the office during the pleasure of the Government as provided
G under Section 6(1) of the Act. The learned Judges are not correct in holding
chat the Government is not affected by allowing the writ of Quo Warranto
against the appointee and observed that the Government ought not have filed
the appeal. It is unfortunate that the learned Judges have observed that the
Government has filed the appeal at the instance of the appointee. The learned
Judges, in our opinion, failed to appreciate that it is the duty of the Government
H to justify the appointment as such there is no wrong in filing the writ appeal.
-.

B. SRINIVASA REDDY r. KARNATAKA URBAN WATER SUPPLY & DRAINAGE BOARD EMP. AS50N. ILAKSHMANAN. I.I 503

In the result, we hold : A
(a) that the appellant was not disqualified for appointment as
Managing Director w.e.f. 1.2.2004.

(b) There is no bar for appointment to the post in question on
contract basis. The Government has absolute right to appoir.t B
persons on contract basis.

(c) Writ of Quo warranto does not lie if the alleged violation is not
of a statutory provision.

(d) There is no violation of Section 4(2) of the Act and Rule 3 of the
Rules because the appellant had experience in administration and
c
capacity in commercial matters before he was appointed as
Managing Director on contract basis by the Government.
(e) The Government has no doubt power to make contractual
appointment until further orders. The power included the power
to make appointment on substantive basis temporary, officiating D
basis, ad hoc basis, daily wages or contractual basis.
(f) Writ filed by respondents I & 2 is motivated.
(g) The petitioners in the writ petition, respondent No. I herein-which
is an unregistered Association under the Trade Unions Act cannot E
maintain the writ petition.
(h) The findings of legal ma/a fides is unsustainable and has no
basis.

The finding of legal malafides suffers from other infirmities as far as placing
reliance on the complaints against the appellant without adverting to the F
orders of the Lokyukta detail examination, the appellant is unequivocal terms
in both the cases.

For the foregoing reasons, the appeals are allowed and tt.e order
impugned in this appeal passed by the Division Bench of the High Court in G
W.A. No. 86/2006 affirming the judgment of the learned single Judge is set
aside.

The Division Bench of the High Court ordered cost in the writ appeal.
There is no justification in ordering cost in the facts and circumstances of the
case. Therefore, the appellant, State Government and respondent No.4 are H
504 SUPREME COURT REPORTS [2006] SUPP. 5 S.C.R.

A entitled to refund the cost, if it has already been paid. However, we are not
ordering cost against respondent Nos. 1 & 2 taking into consideration of the
financial constraint of the employees and by taking a lenient view of the
matter.

In view of this judgment, we allow the appeals filed by Mr. B. Srinivasa
B Reddy and by the State of Karanataka. As noted herein earlier, the appellant
has already been released and in his place a person has already been appointed
as a Managing Director of the Board on contract basis. Keeping this admitted
fact in mind, we, therefore, keep it on record that the Government or the Board
would be at liberty to consider and appoint a candidate, if occasion arises,
on contract basis. If such a situation does arise in that case it would be open
to the State or the Board to consider the candidature of the appellant (B.
Srinivasa Reddy) with others.

B.B.B. Appeals allowed.