M. SANKARANARAYANAN IAS.versusSTATE OF KARNATAKA AND ORS.

A                     M. SANKARANARAYANAN !AS.
                                  v.
                     STATE OF KARNATAKA AND ORS.

                             NOVEMBER 11, 1992

B                    IM.H. KANIA, CJ. AND G.N. RAY, J.]

          Civil Service:

          Transfe!"--Mala fides--lnference of-When arises.
c         Administrative Law-Mala fides--Malice infacHnferences can be
    drawn on basis of factual matrU--Not on insinuations, conjectures and
    sunnises.

         Indian Administrative (Pay) Rules 1954: Indian Administrative
D   (Cadre) Rules:

          Rule 4-Cltief Secretary transferred as Secretary High Powered Com-
    mittee-Ma/a fide!t-He/d not proved-Inference to be based on factual matrix
    not insinuation sitnnise or conjecture-Declaration of equivalence of post
    made by State Govemmel!t held valid.
E
          The appellant was appointed to the Indian Administrative Service .
    (Karnataka Cadre) in 1957, and on May 5, 1990 he was holding the post
    of Additional Chief Secretary to the Government of Karnataka, and by a
    Notification dated May 5, 1990 was appointed a Chief Secretary to the
    Karnataka Government until further orders.
F
        In the State of Karnataka there was originally one post of Chief
  Secretary to the Government. An ex-cadre post of Additional Chief
  Secretary was created with a declaration under Rule 9(1) of !AS (Pay)
  Rules that the status and responsibilities of the said post were equivalent
  to the cadre post of Chief Secretary, and this post was thereafter en-
G cadred by Notification dated January 30, 1987 with the same pay as of the
  post of Chief Secretary. The post of Secretary, High Power Committee, was
  created by the State Government of Karnataka in 1989 with the designa·
  tion Chairman, Hyderabad, Karnataka Development Board by order
  dated September 27, 1989, and was declared equivalent to the status and
H responsibilities to the cadre post of Additional Chief Secretary under Rule
                                       368
        SANKARANARAYANAN v. STATE OF KARNATAKA                      369

9 of IAS (Pay) Rules. The posts of Chief Secretary, Secretary, High Power A
Committee and Additional Chief Secretary thus carried equal pay.

       On January 3, 1991, the Cabinet Government of Karnataka took a
decision to the effect that a change of the Chief Secretary should be
effected, and pursuant thereto, the Chief Minister on January 4, 1991 took
the follo,,ing three decisions, and passed consequential orders viz; (I) B
declaring that the post of Secretary, High Power Committee, was
equivalent in status and responsibilities to the post of Chief Secretary to
the Government, (ii) transferring the appellant, to the post of Secretary,
High Power Committee with immediate effect, and (iii) appointing the 4th
respondent, who was senior to the appellant to the post of Chief Secretary C
to the Government. The Notification giving effect to the above orders of
transfer was issued on January 4, 1991 but the authenticated Government
order declaring the equivalent of the two posts under Rule 9 of IAS (Pay)
Rules, was issued on the next day, viz; January 5, 1991.

      The appellant made an application before the Central Adminlstra- D
tive Tribunal, Bangalore for quashing the order dated January 4, 1991
transferring and posting him as Secretary, High Power _Committee for
Development of Hyderabad, Karnataka area, Bangalore, and for a direc-
tion to allow him to continue as the Chief Secretary. The order was
challenged mainly on two grounds : (1) that such order was not passed E
bona fide for the exigencies of the administration but the same was passed·
ma/a fide by the Chief Minister of Karnataka who became displeased with
the appellant on account of his unfavourable attitude and resistance to
some of the proposals of the Chief Minister in the matter of posting of
senior officers of the State to different posts, and (2) that the transfer
order was vitiated because of non-compliance of the profedural for- F
malities for a valid transfer of the appellant as there was no declaration
under Rule 9(1) of 1AS (Pay) Rules, 1954 that the post of Secretary, High
Power Committee was equivalent to the post of Chief Secretary.

      The respondents viz; State of Karnataka, the Chief Minister as also
respondent No. 4 denied the allegations relating to the malice of facts and G
contended that they were mischievous, malicious, scandalous and
vexatious and such allegations were deliberately made to malign the
respondents, and contended that the post of Secretary, High Power Com-
mittee, was equivalent to the post of Additional Chief Secretary and such
declaration had been made long back, and the post of Additional Chief H
    370                 SUPREME COURT REPORTS [1992] SUPP. 2 S.C.R.

A Secretary and the post of Chief Secretary were also equivalent and inter-
    changeable, and that the appellant can have no grievance against the said
    orders of transfer, and that there is also no occasion to contend that the
    declaration, required as under Rule 9(1) of !AS (Pay) Rules had not been
    made.

B       The Central Administrative Tribunal after considering the facts and
  circumstances came to the finding that the freedom to choose a person as
  the Chief Secretary to the liking of the Chief Minister and the Cabinet on
  whom there is absolute confidence, is undisputed prerogative, and such
  decision becomes unassailable when it is made in bona fide manner follow-
C ing the statutory formalities applicable to such selection and appointment,
  and that the appellant had no subsisting right to remain as Chief
  Secretary and it was the prerogative of the Chief Minister and the Cabinet
  to take a decision to appoint a person to the post of Chief Secretary. The
  Tribunal also held that the appellant bad failed to establish that he bad
D been transferred with the ulterior motive of placing him in a lower post
  and thereby permanently preventing him from continuing in the position
  and status of Chief Secretary. The application was accordingly dismissed.

        Aggrieved by the aforesaid order of dismissal the appellant appealed
  to this Court by Special leave and contended that the declaration of
E equivalence under Rule 9(1) of IAS (Pay) Rules, 1954 is an essential
  statutory requirement and without such declaration of equivalence no mem-
  ber in the cadre of IAS can be transferred to a non-cadre post, and after
  encadrement of the post of Additional Chief Secretary the declaration of
  equivalence which was made earlier lost its force, and that equivalence is
  referable only to an ex-cadre post and ex-bypothesi declaration of
F equivalence cannot come in inter se posts within the cadre. It was also
  submitted that the order of transfer of the appellant and also the order of
  posting of respondent No. 4 had taken place simultaneously in undue haste
  even witbont making a declaration of equivalence and this only indicates that
  there had not been any bona fide and proper exercise to find out the most
G suitable person for the post of Chief Secretary in the normal way.

          The Attorney General appearing with the Advocate General of the
    State of Karnataka for respondent Nos. 1 and 3, namely, the State of
    Karnataka. and the Chief Minister of Karnataka, opposed the appeal and
    submitted that the post of Chairman, Karnataka Hyderabad Development
H   Board was created on September 1, 'l989 and respondent No. 4 was
         SANKARANARAYANAN v. STATEOFKARNATAKA                           371

holding a very high and responsible office at the relevant time, and senior A
to the appellant as a member of the Indian Administra.tive Service, and
that since the Cabinet and the Chief Minister had taken a decision to
relieve the appellant from the post of Chief Secretary, there had been a
necessity to find out a competent senior officer in the I~dian Administra-
tive Service Cadre in the State, that as no departmental proceedings had
been pending against him the Cabinet and the Chier Minister had taken a
                                                                            B
decision to appoint Respondent No. 4 being the seniormost person in the
Indian Administrative Service cadre in the State, having a long experience
in different administrative set np and conversant with the problems of the
State as Chief Secretary, and such decision is not ex facie perverse and
unjustified .                                                                  c
     . Dismissing the appeal, this Court,

      HELD : I. The appellant has not been able to lay any firm founda-
tion warranting a finding that the impugned order of transfer was passed
ma/a fide and/or an oblique purpose in order to punish the appellant D
and/or to humiliate him. (387-E]

      In the instant case, the pleadings of the appellant before the Central
Administrative Tribunal only indicate that some of his suggestions in the
matter of posting of senior bureaucratic officers of the ~tate had not been    E
accepted by the present Chief Minister of the State. Such facts alone do
not constitute any foundation for a finding that because the appellant was
not agreeable to oblige the Chief Minister, he had incurred the displeasure
of the Chief Minister and the impugned orders had been passed not on
administrative exigencies but only to malign the appellant and to
humiliate him. (387-F]                                                         F

       2. It is an admitted position that the Chief Secretary and the Chief
Minister had differences of opinion on a number of sensitive matters. If
on that score, the Cabinet and the Chief Minister had taken a decision to
relieve the appellant from the post of Chief Secretary and post a very         G
senior officer of their confidence to the post of Chief Secretary, it cannot
be held that such decision is per se illegal or beyond the administrative
authority. (388-B]

      3. It may not always be possible to demonstrate malice in fact with
full and elaborate particulars and it may be permissible in an appropriate H
    372                  SUPREME COURT REPORTS [1992] SUPP. 2 S.C.R.

A   case to draw reasonable inference of mala fide from the facts pleaded and
    established. But such inference must be based on factual matrix and such
    factual matrix cannot remain in the realm of insinuation, surmise or
    conjecture. [387-G]

           4. So far invalidity of' the impugned order of transfer for want of
B   declaration or equivalence under Rule 9(1) of IAS (Pay) Rules is con·
    cerned, it is indicated that here had already been a declaration when the
    re-designated post of Secretary, High Power Committee, was established
    that the said post was equivalent to the post of Additional Chief Secretary.
    It i~ the positive stand of the State Government that the post of Chief
C   Secretary and the Additional Chief Secretary are equivalent. [388-C-D]

          5. Prior to the impugned orders, a decision to declare the post of
    Secretary, High Power Committee equivalent to the post of Chief Secretary of
    the State bad been taken. Since the impugned order of transfer was imple-
    mented with immediate effect, the formal publication could not be made on
D   the very same day but was made on January 5, 1991, viz., on the very next day.
    In such circumstances the formal declaration made on January 5, 1991 does
    not invalidate the impugned order of transfer. [388-E-F]

            E.P. Royappa v. State of Tamil Nadu, AIR 1974 S.C. 555, relied on.

E           CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4090 of
    1991.

         From the Order dated 7.2.1991 of the Central Administrative
    Tribunal, Bangalore in Original Application No. 11 of 1991.

F        K.K. Venugopal, B.R.L. Iyengar, E.C. Vidyasagar, D.N. Nanjunda
    Reddy, L.R. Singh and Shahid Rizvi for the Appellant.

         G. Ramaswamy, Attorney General, P.P. Muthanna (for the State of
    Karnataka), Subramanian, M. Verrappa, Kh. Nobin Singh and S. Walla for
G   the Respondents.

            The Judgment of the Court was delivered by

         G.N. RAY, J. This appeal is directed against the decision of the
    Central Administrative Tribunal, Bangalore, dated February 7, 1991 passed
H   in Original Application No. 11 of 1991. The appellant, Shri M.
    SANKARANARAYANAN v. STATE OF KARNATAKA [RAY, J.]                  373

Sankaranarayanan, made an application before the Central Administrative A
Tribunal, Bangalore, for quashing the order dated January 4, 1991 trans-
ferring and posting him as Secretary High Power Committee for develop-
ment of Hyderabad, Karnataka area, Bangalore (hereinafter referred to as
High Power Committee) as contained in Annexure A-4 to the application
made before the Central Administrative Tribunal, and for a direction to
allow the applicant, Shri Sankaranarayanan, to continue as the Chief
                                                                              B
Secretary, Government of Karnataka. The aforesaid order of transferring
and posting the appellant as Secretary, High Power Committee was chal-
lenged mainly on two grounds, namely, that such order was not passed
bona fide for the exigencies of the administration but the same was passed
ma/a fide by the Chief Minister of Karnataka who became displeased with      c
the appellant on account of his unfavourable attitude and resistance to
some of the proposals of the Chief Minister in the matter of posting of
senior officers of the State to different key posts. It was also contended
that his transfer order is vitiated because of the non-compliance of the
procedural formalities for a valid transfer of the appellant to the said post D
of Secretary, High Power Committee inasmuch as there was no dedaration
under Rule 9 (1) of !AS (Pay) Rules, 1954 that the post of Secretary, High
Power Committee, was equivalent to the post of Chief Secretary and in the
absence of such declaration the transfer of the appellant from the post of
Chief Secretary to. the Secretary, High Power Committee, was illegal and
void.                                                                         E

       To appreciate the relevaric contentions made by the appellant and
the respondents before the Central Administrative Tribunal and also
before this Court at the hearing of the appeal, the backdrop of the events
resulting in the impugned order of transfer and posting of the appellant     F
and consequential challenge of such order by the appellant, requires to be
indicated in short.

      The appellant, Shri Sankaranarayanan, was appointed to the Indian
Administrative Service (Karnataka Cadre) in 1957 and on May 5, 1990 he
was holding the post of Additional Chief Secretary to the Government of G
Karnataka. By Notification dated May 5, 1990, he was appointed as Chief
Secretary to the Karnataka Government until further orders. In the State
of Karnataka, there was originally one post of Chief Secretary to the
Government. By an Order dated October 17, 1980, and ex-cadre post of
Additional Chief Secretary was created with a declaration under Rule 9(1) H
    374                 SUPREME COURT REPORTS [1992] SUPP. 2 S.C.R.

A of !AS (Pay) Rules that the status and responsibilities of the said post were
    equivalent to the cadre post of Chief Secretary. The post of Additional
    Chief Secretary was thereafter en-cadred by Notification dated January 30,
    1987 with the same pay as of the post of Chief Secretary. The post of
    Secretary, High Power Committee, was created by the State Government
    of Karnataka in 1989 with the designation Chairman, Hyderabad, Kar-
B   nataka Development Board by order dated September 27, 1989. The said
    post was d;clared equivalent to the status and responsibilities to the cadre
    post of Additional Chief Secretary under Rule 9 of !AS (Pay) Rules. The
    posts of Chief Secretary, Secretary, High Power Committee and Additional
    Chief Secretary carry equal pay. On January 3, 1991, the Cabinet Govern-
c   ment of Karnataka took a decision to the effect that a change of the Chief
    Secretary should be effected. Pursuant to such cabinet decision, the Chief
    Minister, on January 4, 1991, had taken the following three decisions and
    passed consequential orders namely (i) declaring that the post of Secretary,
    High Power Committee, was equivalent in status and responsibilities to the
D   post of Chief Secretary of the Government, (ii) transferring the appellant,
    Shri Sankaranarayanan, to the post of Secretary, High Power Committee
    with immediate effect and (iii) appointing the 4th respondent, Shri N.K.
    Prabhakar Rao, who was holding the post of Chief Secretary to the
    Government. It may be noted in this connection that Shri Prabhakar Rao
    is senior to Shri Sankaranarayanan as a member of the Indian Administra-
E   tive Service. The Notification giving effect to the above orders of transfer
    was issued on January 41 1991 but the authenticated Government order
    declaring the equivalent of two posts under Rule 9 of IAS (Pay) Rules, was
    issued on the next day, namely, January 5, 1991.

F           The appellant, Shri Sankaranarayanan, contended in his application
     before the Central Administrative Tribunal that the appellant was in the
     office of Chief Secretary when Shri Veerendra Patil was the Chief Minister
     of ~.rnataka. There was an intensive anti-corruption drive against the
     senior bureaucrats including the 4th respondent through the instrumen-
     tality of Lok Ayukta. One such Officer was Shri J. Alexender, IAS, who
G    was suspended while he was holding the post of the Chairman and Manag-
     ing Director of the Mangalore Chemicals and Fertilisers Ltd. but when Shri
     Alexender obtained a: stay order from the Central Administrative Tribunal,
     the appellant, in the best interest of administration suggested that Shri
     Alexender should not be given the post of Secretary of the Department of
H    Industry and Commerce but he should be given a posting in a less sensitive
                                                                                   ('
   SANKARANARAYANAN v. STATE OF KARNATAKA [RAY, J.]                    375

post but such suggestion of the appellant was not accepted by the third A
respondent, namely, the present Chief Minister of Government of Kar-
nalaka, Shri S. Bangarappa. Similarly, when a proposal lo replace Shri
Sangameswar, IAS, from the post of Managing Director of the Mysore
Sales International Ltd. and post one Shri Madhu in Place of Shri San-
gameswar came up for consideration, the appellant pointed out to the B
Chief Minister about the propriety in making such a change particularly
when Shri Sangameswar was keen in defending the cases filed against the
Government in the Supreme Court and his other actions were also ap-
preciated by his superiors and Shri Madhu had indicated his reluctance to
accept the post in his letter to the Government in view of the fact some of
his relatives happened to be. excise contractors. But the third respondent    c
did not like his suggestion and directed the posting of Shri Madhu as
Managing Director, Mysore Sales International Ltd. The third respondent
also did not like to pass orders on the files containing the irregularities
committed by the fourth respondent while holding high offices in the State
 during the period between 1983 and 1989. These files contained 41st D
 report of the Public Undertaking Committee recommending enquiry into
 the imprudent decisions taken by the 4th respondent as Chairman and
Managing Director of the New Government Electric Factory, Bangalore.
Accordingly, at the instance of the then Minister of Industries and Com-
merce an enquiry had been undertaken through Lok Ayukta. The Report           E
submitted after the enquiry indicated prima facie case against the 4th
respondent warranting further departmental actions. The former· Chief
Minister made enquiries about these matters and the appellant also fur-
nished further necessary information to the then Chief Minister who
referred the matter to the Personnel Department of Administrative
                                                                              F
Reforms. The Secretary, Department of Personnel and Administrative
Reforms suggested for initiation of departmental action against the fourth
respondent. The fourth respondent made a suggestion to the Government
seeking permission for voluntary retirement. But after the Ministry headed
by the then Chief Minister, Shri Veerendra Patil, was dismissed and the
President's rule was imposed in the State, the fourth respondent withdrew G
his letter seeking voluntary retirement. The appellant put up all the files
before the third respondent for appropriate orders in view of the fact that
the previous Chief Minister did not take any final decision regarding the
~roposal to initiate disciplinary action against the fourth respondent. But
the third respondent keep the files without passing any orders. It was H
    376                 SUPREME COURT REPORTS [1992] SUPP. 2 S.C.R.

A contended by the appellant that since the appellant was not prepared to
    1
    lies and to compromise with the desires of the Chief Minister, the Chief
    Minister, namely, the respondent No. 3, became displeased with him and
    opposed some of his suggestions relati~g to the posting of senior
    bureaucratic officers. The appellant has contended that he was sought to
    be transferred with undue haste from the post of Chief Secretary to the
B   post of Secretary, High Power Committee, although such post was inferior
    to the post of Chief Secretary and no declaration under Rule 9 (1) of IAS
    (Pay) Rules for the equivalence of the said post had been made.

         The respondents, namely, the State of Karnataka and the Chief
c Minister of Karnataka and also the said respondent No. 4 denied the
  allegations relating to the malice of facts and contended that the allegations
  relating to the malice of facts were mischievous, malicious, scandalous and
  vexatious and such allegations were deliberately made to malign the
  respondents. The respondents also contended that the post of Secretary,
D High Power Committee, was equivalent to the post of Additional Chief
  Secretary and such declaration had been made long back and the post of
  Additional Chief Secretary and the post of Chief Secretary were also
  equivalent and inter-changeable. In any event, before giving effect to the
  order of transfer of the appellant, further declaration was made by the
  Chief Minister that the post of Secretary, High Power Committee was
E equivalent to the post of Chief Secretary so that in any event the appellant
  had no occasion to feel stifled. Accordingly, there was no occasion to
  contend that the declaration, required as under Rule 9 (1) of !AS (Pay)
  Rules, had not been made and the order of transfer was accordingly
  vitiated for non compliance with the statutory rules. The Central Ad-
F ministrative Tribunal, after considering the facts and circumstances of the
  case and hearing the submissions made on behalf of the respective parties,
  inter alia came to the finding that the freedom to choose a person as the
  Chief Secretary to the liking of the Chief Minister and the Cabinet on
  whom there is absolute confidence, is undisputed prerogative and such
  decision becomes unassailable when it is made in bona fide manner follow-
G ing the statutory formalities applicable to such selection and appointment.
  Referring to the decision of this Court made in the case of E.P. Royappa
  v. State of Tamil Nadu, AIR 1974 SC 555 and referring to various obser-
  vations made in the said decision at length, the Central Administrative
  Tribunal came to the finding that the appellant had no subsisting right to
H remain as Chief Secretary and it was the prerogative of the Chief Minister
       SANKARANARAYANAN v. STATE OF KARN.\TAKA [RAY, J.]                    377

    and .the Cabinet to take a decision to appoint a person to the post of Chief A
    Secretary in place of the appellant to whom the Cabinet and the Chief
    Minister had confidence. It was held by the Central Administrative
    Tribunal that the appellant had failed to establish that he had been
    transferred with the ulterior motive of placing the appellant in a lower post
    and thereby permanently preventing him from continuing in the position
    and status of Chief Secretary. The Administrative Tribunal inter a/ia held
                                                                                  B
    that it is an admitted position that there was o difference of opinion
    between the appellant and the Chief Minister and such difference had been
    developing ever since the new Chief Minister had assumed Office. The
    Tribunal had also noted that the appellant was also not promoted and
    posted as Chief Secretary permanently but he was appointed to the post         c
    of Chief Secretary until further orders and he continued in that capacity
    only for eight months without being regularised or confumed in that post.
    The Central Administrative Tribunal also held that there had been only
    casual collateral challenge by the appellant against the appointment of
    fourth respondent as the Chief Secretary raising some allegations which D
    could at best be grouped in the category of vague and indefinite allegations.
    The Central Administrative Tribunal held inter alia that the applicant had
    not laid down any firm foundation to hold that the appoinlmrnt of the 4th
    respondent as Chief Secretary was bad and unsustainable. It has been held
    by the Central Administrative Tribunal that the fourth respondent had
    already assumed the office of the Chief Secretary and except in making E
    some vague allegations, his appointment as Chief Secretary was not chal-
    lenged on the score of violation of rules governing the matter. As such, the
    Central Administrative Tribunal held that there was no occasion to go into
    the legality of the posting of fourth respondent as the Chief Secretary of
    the State.
                                                                                   F

-          So far as the other contention made by the appellant, namely, that
    .the transfer order is vitiated in view of the fact that the appellant was
     sought to be reverted to a lower post in violation of the procedure in Rule
    9 (1) of !AS (Pay) Rules and Rule 4 of !AS (Cadre) Rules in concerned,
     it has been contended by the appellant that a Notification issued on G
    January 5, 1991 declaring the post of Secretary, High Power Committee, as
     equivalent to the post of Chief Secretary, was of no consequence and could
    not cure the initial defect inasmuch as prior to such Notification issued on
    January 5, 1991 declaring equivalence of the said posts, the impugned order
    of transfer was sought to be effected and the respondent No. 4 was allowed H
    378                  SUPREME COURT REPORTS [1992] SUPP. 2 S.C.R.

A lo join the post of Chief Secretary pursuant to the order of transfer of the
  appellant. The Central Administrative Tribunal referred to four documents
  being Annexures 7, 8, 9 & 10 to the application made by the appellant and
  also the affidavits tiled by the parties and accepted the contention of the
  respondents that the post of the Secretary was declared equivalent to the
B post   of Additional Chief Secretary and the post of Additional Chief
  Secretary was also declared equivalent to the post of Chief Secretary, and
  such declarations had been made ever since 1980 and the appellant was
  fully aware of the said position. The Central Administrative Tribunal also
  accepted the contention of the respondents that in order to avoid any
  embarrassment and complication, the State Government had also made a
c declaration on January 4, 1991 prior to the transfer of the appellant that
  the post of the Secretary, High Power Committee, .was equivalent to the
  post of Chief Secretary buf the formal authenticated order declaring the
  said equivalence was issued next day i.e. January 5, 1991. There was no
  delay in issuing the declaration and even assuming that there was a delay
V of one day in making the formal declaration of equivalence, such delay had
  not nullified and invalidated the decision of the Government. Referring to
  the various decisions of this Court including the decision made in the case
  of Babula/ v. Mis Hazari Lal Kishori Lal and others, [1982] 2 SCC p.525,
   the Central Administrative Tribunal indicated that a deviation from the
E strict procedure prescribed by law would not vitiate an action taken by the
   Government or public authority in the interest of public unless it·could be
  shown that such an act had resulted in gross injustice to the affected party.
   The Central Administrative Tribunal held that the appellant could not
   establish that impugned order had caused any serious injury to him. The
   Central Administrative Tribunal further held that the appellant had sub-
F mitted that because of the delay in issuing the declaration strictly in


                                                                                     -
   accordance with the Rule 9(1) of !AS (Pay) Rules, the appellant was in
   dark as to the nature and duties of the post of Secretary, High Power
   Committee, to which he had been transferred under the impugned order.
   The Central Administrative Tribunal held that the form and procedure in
G Rule 9(1) of !AS (Pay) Rules do not make it obligatory to approach the
   issue in a judicial or quasi judicial manner and the violation, if any, of Rule
   9(1) was only a mere technicality and it did not cause any legal injury or
     injustice to the appellant. Such violation, even if any, was not so serious
     that it required a judicial scrutiny by the Central Administrative Tribunal
H    in the facls and circumstances of the case. The Central Administrative
       SANKARANARAYANAN v. STATE OF KARNATAKA [RAY, J.]                      379

-   Tribunal also held that after going through the files leading to the decla-
    ration under Rule 9(1) since placed before the Tribunal, the Tribuoal was
                                                                                    A

    satisfied that the Government had considered the question in detail and
    sufficiently in advance and had taken a decision to issue the declaration of
    equivalence on January 4, 1991 and it was a valid decision satisfying the
    requirement of Rule 9 (1) of IAS (Pay) Rules, 1954. Referring to the            B
    allegations of ma/a jides, the Central Administrative Tribuoal came to the
    finding that the facts were narrated in paragraphs (1) to (w) of paragraph
    6 of the application of the appellant. The Tribuoal categorically came to
    the finding that there was no firm foundation to find on facts that the
    impugned order was vitiated by any ma/a fide. In that view of the matter,
    the Central Administrative Tribuoal dismissed the application made by the       C
    appellant. As aforesaid, the said decision is under challenge in this appeal.

          Mr. Venugopal the learned counsel for the appellant has strenuously
    contended that declaratio11 of equivalence under Rule 9 (1) of IAS (Pay)
    Rules, 1954 is an essential statutory requirement and without such decla- D
    ration of equivalence no member in the cadre of IAS can be transferred
    to a non-cadre post. He has contended that the declaration of equivalence
    of the posts of Chief Secretary and Additional Chief Secretary made in
    1980 has been highlighted beyond proportion before the Central Ad-
    ministrative Tribunal by the respondents and the Administrative Tribunal
    was also influenced because of such declaration of equivalence made in E
    1980. But such declaration of equivalence is of no consequence and the
    legal requirement of declaration of equivalence was still there and non-
    compliance with the requirement of declaration of equivalence has
    rendered the impugned order of transfer illegal and void. Mr. Venugopal
    has contended that previously there was only one post of Chief Secretary F
    in the administrative hierarchy in the State of Karnataka. It was felt
    necessary that a post of Additional Chief Secretary should be created and
    the recommendation to that effect was made when the post of Additional
    Chief Secretary was not encadred. A declaration of equivalence was also
    made by the State Government so that a cadre officer belonging to the
    Indian Administrative Service may be transferred to .the non-cadred post G
    of Additional Chief Secretary but later on, the post of Additional Chief
    Secretary \Vas encadred on the basis of triennial review. After such en-
    cadrcment of the post of Additional Chief Secretary, the declaration of
    equivalence which was made earlier lost its force. Mr. Venugopal has
    suhrnilted that the question of equivalence comes in when one post is H
    380                 SUPREME COURT llEPORTS (1992] SUPP. 2 S.C.R.

A outside the cadre post of Indian Administrative Service. Mr. Venugopal
                                                                                   ...
  has contended that equivalence is referable only to an ex-cadre post and
  ex-hypothesi declaration of equivalence cannot come inter se posts within
  the cadre. Accordingly, all the previous exercises made in declaration of
  equivalence when the post of Additional Chief Secretary was not a cadre
  post are of little consequence. Mr. Venugopal has also contended that the
B
  posts of Additional Chief Secretary and Chief Secretary are not equivalent
  in reality. The post of Chief Secretary is the highest post in the administra-
  tive set up in the State. Mr. Venugopal has referred to the Office
  Memorandum dated September 2, 1988 at page No. 127 of Volume II-A
  of the Paper Book of this appeal, for the purpose of showing that the post
C of Chief Secretary is superior post because Additional Chief Secretary is
  to report to the Chief Secretary. He also made reference to the Karnataka
  Government (Transfer of Business) Rules, 1977 and contended that refer-
  ence to various provisions of the Rules would indicate that the post of Chief
  Secretary is the highest post and the reports of different Secretaries
D including Additional Chief Secretary are required to be routed through
  Chief Secretary but no Report of the Chief Secretary is ever required to
  be routed through Additional Chief Secretary or any other Officer. He has
  submitted that a mere declaration that the post of Additional Chief
  Secretary is equivalent to the post of Chief Secretary will not make both
   the said posts equivalent. Mr. Venugopal has also contended that as a
E matter of fact, the respondents felt difficulty in transferring the appellant
   to the post of Secretary, High Power Committee, because the said post was
  declared equivalent to the post of Additional Chief Secretary and not to
   the post of Chief Secretary. Precisely for the said reason, after the im-
   pugned order of transfer, an attempt was made to publish a declaration on
  January 5, 1991 to the effect that the post of Chief Secretary is equivalent
F
   to the post of Secretary, High Power Committee. Mr. Venugopal has
   contended that the post of Secretary, High Power Committee, cannot be
   equivalent to the post of Chief Secretary of the State which is highest post
   and in any event the post facto declaration of equivalence on January 5,
   1991 cannot cure the initial defect of not declaring equivalence of the post
G in question prior to the order of transfer made on January 4, 1991. Mr.
   Venugopal has submitted that the appellant may not have an absolute right
   to remain in the post of Chief Secretary and for good administrative
   reasons the Cabinet and the Chief Minister may have a prerogative to
   select a person of their confidence to the post of Chief Secretary but the
H
   SANKARANARAYANAN v. STATE OF KARNATAKA [RAY, J.]                   381

appellant having been appointed as Chief Secretary can only be removed A
from the said post for good administrative reasons but not for any oblique
purpose. The appellant could have been transferred from the post of Chief
Secretary to a suitable· post which was equivalent to the post of Chief
Secretary only in accordance with law and a declaration of equivalence
under Rule 9 (1) of IAS (Pay) Rules was an essential sine qua non for B
transferring an incumbent holding the post of Chief Secretary to any other
ex-cadre post. Mr. Venugopal has contended that declaration of
equivalence of a cadre post with a non-cadre post is a statutory require-
ment under Rule 9(1) ofIAS (Pay) Rules. Such statutory requirement must
be strictly complied with. So long the declaration of equivalence made by
the competent authority is not published in accordance with the procedure C
under Rule 9(1), no. equivalence takes place and in ''1.e absence of
equivalence, no cadre officer can be posted to a non-cao. o post. Admit-
tedly, the impugned order of transfer of the appellant was made on January
4, 1991 and the respondent No. 4 purported to assume the office of the
Chief Secretary on January 4, 1991. But the declaration of equivalence was D
made on 5.1.1991 i.e. after the impugned order of transfer. Hence, the
impugned order of transfer of the appellant is illegal on the face of it and
subsequent declaration of equivalence cannot cure the invalidity of the
order of transfer. On this score alone the impugned order is liable to be
quashed. Mr. Venugopal has further cont~nded that the Central Ad-
ministrative Tribunal failed to appreciate that in reality the posts of Chief E
Secretary and Additional Chief Secretary were not inter-changeable and
declaration of equivalence made earlier had lost its force after the encadre-
 ment of the post of Additional Chief Secretary.

     . Mr. Venugopal has also submitted that it is nor always possible and F
practicable to precisely establish ma/a fide in fact but the Court should draw
reasonable inference from the pleadings whether there was any foundation of
ma/a fide action. Mr. Venugopal has contended that the appellant has given
instances how he gradually incurred displeasure of the present Chief Mini-
ster when his suggestions for posting senior bureaucratic officers of the State
in key and sensitive positions, contrary to the desire of the Chief Minister, G
were not liked by the Chief Minister. Mr. Venugopal has contended that the
respondent No. 4 was found prima facie guilty of various administrative
lapses of serious nature over the years. During the regime of the previous
Chief Minister of the State, Shri Veerendra Patil, enquiries had been con-
ducted at a high level and recommendations were made for initiating H
    382                  SUPREME COURT REPORTS (1992] SUPP. 2 S.C.R.

A departmental proceedings. Unfortunately, before any formal order could be
  passed by the then Chief Minister, Shri Veerendra Patil, the Ministry was
  dissolved and the President's rule was imposed. Thereafter, the present Chief
  Minister came to head the Cabinet of the State. The appellant as a Chief
  ,Secretary of the State was duty bound to place all the relevant files for
  appropriate directions of the Chief Minister so far as the respondent No. 4 is
B
   concerned. When the appellant placed all the relevant files, it was only
   reasonably expected that the present Chief Minister would pass formal
   orders for initiating departmental proceedings against the respondent No. 4
   but for inexplicable reasons, the present Chief Minister held back the files
   without passing any order. Even in the matter of posting of Shri Alexander,
C Sri Sangmeswar and Sri Madhu, the appellant indicated cogent reasons
   relating to the posting:; desired by the Chief Minister and normally reason-
   ings indicated by the appellant were not expected to be over-ruled by the
   Chief Minister in the interest of purity in administration. But, unfortunately,
   such suggestions had been overruled by the Chief Minister. Mr. Venugopal
D has contended that in the backdrop of the events disclosed in various sub-
   paragraphs, namely, paragraphs 6(1) to 6(q) of the petition made before the
   Tribunal it should have come to the finding that a case of malice in fact had
   been establishedprima facie and the respondents were under an obligation to
   dispel the reasonable inferences to be drawn by the Tribunal atout the
   existence of malice in facts. Unfortunately, the Tribunal has not considered
E the question in the proper perspective. Mr. Venugopal has submitted that
   since the posting of respondent No. 4 as Chief Secretary was not directly
   challenged by the appellant and infraction of any statutory provisions could
   not be established by the appellant so far as the posting of respondent No. 4
   is concerned, the Tribunal has proceeded on the footing that such posting,
   therefore, is not required to be interfered with and consequently the chal-
F
   lenge to the transfer and posting of the appellant cannot also be sustained.
   Mr. Venugopal has contended that such approach, to say the least, is unsatis-
   factory and requires a re-thinking. Mr. Venugopal has also contended that
   when the former Chief Secreta.-y went on leave prior to his retirement, the
   appellant's case was considered and in view of his excellent track record over
G the past 33 years as a member of the Indian Administrative Service in the
    Karnataka cadre, the appellant was found to be most suitable candidate to
   hold the post of Chief Secretary and he was made the Chief Secretary. Simply
   because the appellant was appointed as the Chief Secretary until further
     orders, such appointment and posting do not necessarily mean that he was
H
    Si\NKARANARAYANAN v. STATE OF KARNATAKi\ [RAY, l.J                   383

holding the said post only as a stop-gap-measure. Mr. Venugopal has con- A
tended that it is nobody's case that the Government of Karnataka did not
intend to appoint and post the appellant as Chief Secretary of the State and
such posting was made only by way of a stop-gap-measure until suitable
person could be selected and later on the respondent No. 4 was posted as
Chief Secretary on appropriate consideration of the cases of all the eligible
officers of the State. Mr. Venugopal has contended that the order of transfer
                                                                                 B
of the appellant and also the order of posting of respondent No. 4 had taken
place simnltaneously in undue haste even without making declaration of
equivalence. It only indicates that there had not been any bona fide and
proper exercise to find out the most suitable person for the post of Chief
Secretary in the normal way. He has submitted that although no specific        c
pleading was made by the appellant before the Tribunal that in order to find
a berth for the respondent No. 4, the appellant was moved out against the
interest of the administration and the respondent No. 4 was appointed as
Chief Secretary of the State, there is sufficient material to indicate that the
Chief Minister was bent upon to move out the appellant from the post of D
Chief Secretary who had always resisted improper suggestions of the Chief
Minister in the better interest of the administration and to give effect to such
improper decision not on the score of administrative exigencies or for public
interest, the impugned order of transfer was made. On the face of the adverse
materials on record and the recommendations made by the appropriate
Committee to initiate disciplinary proceedings against the respondent No. 4, E
there could not have been any administrative exigency to place the respon-
dent No. 4 incharge of the highest Administrative office in the State. Mr.
Venugopal has submitted that ma/a fide in fact needs to be considered from
the totality of the facts and circumstances by drawing reasonable inferences.
There cannot be a straight jacket formula to which every case of malice of fact
                                                                                 F
can fit in.

      Mr. Attorney General appearing with the Advocate General of the
State of Karnataka for the respondents Nos. 1 and 3, namely, the State of
Karnataka and the Chief Minister of Karnataka, has submitted that the post
of Chairman, Karnataka-Hyderabad Development Board was created on G
September 1, 1989 and the respondent No. 4 who was holding a very high
and responsible office at the relevant time. The respondent No. 4 is a very
senior member of the Indian Administrative Service in the Karnataka cadre
and admittedly senior to the appellant as a member of the Indian Ad-
ministrative Service. The said respondent No. 4 was appointed to the post H
    384                 SUPREME COURT REPORTS [1992] SUPP. 2 S.C.R.

A of Chairman, Karnataka-Hyderabad Development Board. The said post                 -·
  was declared as equivalent to the post of Additional Chief Secretary on
  September 27, 1989 when the said post was created. Later on, on October
  11, 1989, the said post of Chairman was re-designated as Secretary, High
  Power Committee and ex-officio Additional Chief Secretary to the Govern-
B ment of Karnataka. Mr. Attorney General has contended that simply
  because adverse comments were made on the functioning of the respon-
  dent No. 4 when he was holding the post of Chairman of some other
  organisation or the Secretary, High Power Committee, there was no com-
  pelling necessity of by-passing a very senior officer in the Indian Ad-
  ministrative Service cadre in the State. Since the Cabinet and the Chief
c Minister had taken a decision to relieve the appellant from the post of
  Chief Secretary, there had been a necessity to find out a competent senior
  officer in the Indian Administrative Service Cadre in the State. As no
  departmental proceedings had been pending against him, the Cabinet and
  the Chief Minister had taken a decision that Mr. Rao, respondent No. 4,
D being the seniormost person in the Indian Administrative Service cadre in
  the State, having a long experience in different administrative set up and
  conversant with the problems of the State should be posted as Chief
  Secretary. Such decision is not ex facie perverse and unjustified. He has
  contended that even if it is assumed that instead of re;pondent No. 4, some
E other officer would have been selected for the post of Chief Secretary, such
  selection being a prerogative of the Cabinet and the Chief Minister, the
   appellant cannot question the correctness and propriety of the same. The
   Central Administrative Tribunal is justified in its finding that there has not
  been any direct challenge to the appointment of the respondent No. 4 to
   the post of Chief Secretary and the appellant could not establish that any
F statutory rule has been violated in giving appointment to the respondent
   No.4 to the post of Chief Secretary. Mr. Attorney General has also
   contended that the law is well-settled after the decision of this Court in
   E.P. Royappa (supra) that it is the prerogative of the State Cabinet and the
   Chief Minister to select a person of their confidence to man the key post
G of Chief Secretary in the State. The only exercise which is required to be
   made by Court of law or a Tribunal is to find out whether in removing the
   holder of the post of Chief Secretary, any ma/a fide action has been taken.
   The Tribunal, according to the learned Attorney General, is justified in
   holding that except making some vague allegations, no firm foundation has
                                             '
H been laid by the appellant to warrant a finding    that the impugned order of
   SANKARANARAYANAN v. STATE OF KARNATAKA [RAY. J.]                  385

transfer of the appellant is actuated by a malice in fact or malice in law. A
Mr. Attorney General has submitted that the Tribunal has indicated that
the Chief Secretary had not been pulling on well with the Chief Minister
of the State, and there had been differences of opinion on a number of
matters from before. If on such account, the Government and the Chief
Minister felt that a man of their confidence should be posted as the Chief B
Secretary of the State so that there was a good rapport between the Chief
Secretary and the Chief Minister and the Cabinet, no exception can be
made and such decision being squarely within the prerogative of the Chief
Minister and the Cabinet as indicated by this Court in no uncertain terms
in Royappa's decision, the Central Administrative Tribunal was justified in
declining to interfere against the impugned orders. Mr. Attorney General C
has contended that allegations of ma/a fide action on the part of the Chief
Minister or the Cabinet must be substantiated by cogent materials and not
by vague insinuations. In the pleadings, the appellant has only indicated
several instances showing how he assessed the facts in giving suggestions
in the matter of posting of different top bureaucratic officers including D
respondent No. 4 and how his suggestions had not beea ultimately accepted
by the Chief Minister. Such facts by no stretch of imagination establish a
case of ma/a fide action of the State Government in transferring the
appellant from the post of Chief Secretary. Mr. Attorney General has
contended that in order to overcome the decision of the Tribunal, on the
pleadings made before the Tribunals, the appellant has attempted to E
introduce a new case in paragraph 20 of the special leave petition by setting
up the appointment of respondent No. 4 as both proof and result of the
Chief Minister's ma/a [ides. To make it a triable issue, ground 'k' has been
taken in the special leave petition.. But introduction of a new case for the
first time before this Court by way of embellishment cannot be permitted. F
He has contended that the said new case is far from truth and is an
after-thought deserving outrigh: rejection.

       Mr. Attorney General has also contended that by virtue of holding a
particular adn1inistrative position, an incumbent of the post may have the G
privilege to have the reports of other senior bureaucratic Officers routed
through him under the prevalent rules of business. Such facts alone do not
establish that such post is superior to other post. If there has been a
declaration of equivalence under Rule 9(1) of !AS (Pay) Rules, the post
must be held to be equivalent irrespective of the fact that because of the
rules of business one of the two equivalent posts enjoys some advantage or H
    386                SUPREME COURT REPORTS (1992] SUPP. 2 S.C.R.

A privilege. Mr. Attorney General has contended that the declaration in 1980
  was made under Rule 9(1) of !AS (Pay) Rules to the effect that the post
  of Additional Chief Secretary which was then an ex-cadre post was
  equivalent to the post of Chief Secretary. Although, subsequently the post
  of Additional Chief Secretary was encadred, the declaration of equivalence
  has not lost its force as sought to be contended by Mr. Venugopal. Mr.
B Attorney General has contended that even assuming that after the encadre-
  ment there was no further scope of declaring equivalence, the fact remains
  that there had been appreciation and understanding of the State Govern-
  ment about the importance of the two posts and factual assessment of
  equivalence of the two posts. He has contended that in any event, such
c question has become academic in the instant case because pursuant to the
  Cabinet decision, an exercise was made on January 4, 1991 to declare the
  post of Secretary, High Power Committee, as equivalent to the post of
  Chief Secretary itself so that there may not be any occasion for the
  appellant to feel stifled. Such decision had taken place prior to the im-
D pugned order of transfer but the publication could not be made on the
  same day, namely, January 4, 1991 but such publication of equivalence
  under Rule 9 (1) was made on the very next day, namely, on January 5,
  1991. Mr. Attorney General has contended that publication on the next day
  does not invalidate the factum of declaration made on January 4, 1991.
   Such publication being a requirement of statute has been complied with
E and the publication has been made in order to give effect to the decision
   of declaring oquivalence already taken.

         Mr. Attorney General has contended that it has been specifically
  stated by the Chief Minister in his affidavit in opposition that declaration
F of equivalence was made on January 4, 1991 prior to the impugned order.
  Mr. Attorney General, has also submitted that even if it is assumed that
  the publication of declaration of equivalence was made on January 5, 1991
  but the impugned order of transfer was made on January 4, 1991, and by
  that process there has been violation of Rule 9(1) of !AS (Pay) Rules, such
  violatiort is a mere technical violation for which no interference by this
G Court is called for. He has submitted that Central Administrative Tribunal
  was justified in coming to the finding that no real injury was caused to the
  appellant for such technical violation, even if any, and as such no inter-
  ference was called for by the Tribunal against the impugned order of
  transfer. Mr. Attorney General has contended that interference under
H Article 136 of the Constitution is not a matter of course. Such interference
   SANKARANARAYANAN v. STATE OF KARNATAKA [RAY, J.]                    387

is required to be made if it conforms both to equity and law. In the facts A
and circumstances of the case, the appellant has not been able to make out
any case for such interference within the discretionary remedy of this Court
and the appeal should, therefore, be dismissed. Mr..Attorney General has
also submitted that the appellant is guilty of suppression of material facts.
After the impugned order of transfer, in view of some statements made by
                                                                              B
the appellant to the Press against Chief Minister, a decision was taken to
initiate disciplinary proceeding against the appellant and he was placed
 under suspension. Such suspension was challenged by the appellant before
 the Central Administrative Tribunal, Bangalore, in Application No. 78 of
 1991 and an interim order of stay of the order of suspension was passed
 in the said proceeding, but subsequent to the filing of the instant special c
 leave petition before this Court, the interim order of stay was vacated by
 the Administrative Tribunal. In the aforesaid facts, the factum of suspen-
 sion was required to be disclosed by the appellant. Mr. Attorney General
 has contended that for suppression of material facts, this Court should
 refuse to interfere in this appeal and should dismiss the same. He has also D
 contended that in view of order of suspension, the appellant, in any event,
 cannot be permitted to hold or continue to hold the post of Chief Secretary.

      After considering the respective contentions of the learned counsels
appearing for the parties, it appears to us that the appellant has not been able
to lay any firm foundation warranting a finding that the impugned mder of E
transfer was passed ma/a fide and/or for an oblique purpose in order to
punish the appellant and/or to humiliate him. The pleadings of the appellant
before the Central Administrative Tribunal only indicate that some of his
suggestions in the matter of posting of senior bureaucratic officers of the
State had not been accepted by the present Chief Minister of the State. Such F
facts alone do not constitute any foundation for a finding that because the
appellant was not agreeable to oblige the Chief Minister by accepting all his
suggestions and putting up notes to that effect, he had incurred the dis-
pleasure of the Chief Minister and the impugned orders had been passed not
on administrative exigencies but only to malign the appellant and to humiliate G
him. It may not always be possible to demonstrate malice in fact with full and
elaborate particulars and it may be permissible in an appropriate case to
draw reasonable inference of ma/a fide from the facts pleaded and estab-
lished. But such inference must be based on factual matrix and such factual
matrix cannot remain in the realm of insinuation, surmise or conjecture. In
 the instance case, we are unable to find that there are sufficient materials H
    388                  SUPREME COURT REPORTS [1992) SUPP. 2 S.C.R.

A from which a reasonable inference of malice in fact for passing the impugned
    order of transfer can be drawn. It is an admitted position that the Chief
    Secretary and the Chief Minister had differences of opinion on a number of
    sensitive matters. If on that score, the Cabinet and the Chief Minister had
    taken a decision to relieve the appellant from the post of Chief Secretary and
    post a very senior officer of their confidence to the post of Chief Secretary, it
B   cannot be held that such decision is per se illegal or beyond the administrative
    authority. The position in this regard has been well explained in Royappa's
    case by this Court.


           So far as the other contention of the appellant, namely, invalidity of the
c impugned order of transfer for want of declaration of equivalence under
  Rule 9(1) ofIAS (Pay) Rules is concerned, it may be indicated that there had
  already been a declaration when the re-designated post of Secretary, High
  Power Committee, was established that the said post was equivalent to the
  post of Additional Chief Secretary. It is the positive stand of the State
D Government that the posts of Chief Secretary and the Additional Chief
  Secretary are equivalent. But in the instant case, it is also not necessary to
  decide the question in detail as to whether in reality both the said posts are
  not \'quivalent as sought to be contended by Mr. Venugopal. It appears to us
  that prior to the impugned orders, a decision to declare the post of Secretary,
  High Power Committee, equivalent to the post of Chief Secretary of the State
E had been taken. Since the impugned order of transfer was implemented with
  immediate effect, the formal publication could not be made on the very same
  day but was made on January 5, 1991, namely, on the very next day. It appears
  from the records that the decision to declare equivalence was taken prior to
  the impugned order of transfer and the formal publication byway of statutory
F requirement was made in order to give effect to the decision to declare
  equivalence already taken. In such circumstances, we do not think that the
  formal declaration made on January 5, 1991 invalidates the impugned order
  of transfer. The Tribunal is justified in holding that infraction, even if any, in
  making publication formally on January 5, 1991, is only a technical violation
  for which no interference is called for. In the result, we do not find any reason
G to interfere with the impugned decision of the Central Administrative
  Tribunal and the appeal, therefore, fails and is dismissed but \\ithout any
  order as to costs.


     NVK                                                          Appeal di>111issed.




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