UP Awas Evam Vikas Parishad's Function Does Not Include Fixing its Employees' Service Conditions : Supreme Court

A bench of Justices Sanjay Kishan Kaul, Abhay S. Oka and Vikram Nath have delivered the judgment which has been authored by Justice Abhay S. Oka.

The brief facts of the case were that under Section 3 of the Uttar Pradesh Avas Evam Vikas Parishad Adhiniyam, 1965 (for short 'the 1965 Act'), Uttar Pradesh Avas Evam Vikas Parishad (for short 'the Board') was established. The basic object of the establishment of the Board was framing and executing housing and improvement schemes in the State of Uttar Pradesh. The larger issue that was up for consideration before the bench through a reference made by a division bench of the Supreme Court in State of U.P. vs. Preetam Singh & Ors. 2014 (15) SCC 774 was whether the act of determining service conditions of the employees and officers of the Board is one of the statutory functions of the Board.

First, let's have a look at the three referral questions.

THREE REFERRAL QUESTIONS

The three questions up for consideration before the three judge bench were as follows:

(1) Whether the judgment of this Court in State if U.P. vs. Preetam Singh & Ors. 2014 (15) SCC 774 laying down that conditions of service of officers and employees do not constitute the functions of the U.P. Avas Evam Vikas Parishad lays down the correct law more so when the judgment does not refer to provisions of Sections 8, 92, 94(2)(nn)of the 1965 Act ?

(2) Whether the view expressed in Preetam Singh's judgment that functions of the U.P. Avas Evam Vikas Parishad are only the specific functions enumerated in Section 15 of 1965 Act which does not include the service conditions of employees of the Board lays down the correct law ? Whereas the functions of the Board referred to in other provisions of Act, Rules and Regulations as has been expressly provided in Section 15(1) by use of expression "subject to the provisions of this Act and the Rules and Regulations" shall also be functions of the Board which induces service conditions of officers and employees as per Section 95(1)(f) of the 1965 Act.

(3) Whether the State Government had no jurisdiction to issue directions regarding service conditions of officers and employees of the U.P. Avas Evam Vikas Parishad under the provisions of the 1965 Act and 1975 Act and all other enabling powers with the State Government?

The court set out to answer the above questions by engaging itself in a discussion on three key aspects.

POWER TO DETERMINE THE CONDITIONS OF SERVICE OF THE OFFICERS AND SERVANTS OF THE BOARD

The judgment starts by first laying out the bare provisions from the legislation. It states that the statute nowhere grants the state government the explicit power to determine conditions of service of the officers and servants. It clearly distinguishes between the power of the state government to control the recruitment process vis-a-vis the power of the Board to determine the conditions of service of the officers and the servants.

It says, "26…Subsection (1) of Section 8 does not provide that the State Government shall have the power to determine the conditions of service of officers and employees of the Board. The power to control the appointment and the power to put restrictions are distinct and different from the power to determine the service conditions of the officers and servants of the Board. The control of the State Government and the power to impose restrictions as provided in subsection (1) of Section 8 will extend to the creation of posts of officers and servants of the Board. The control can be exercised by directing the creation of different categories of posts. The control can be also exercised by determining the number of posts of different categories.

However, the court then points to a provision within the statute that grants the State government the power to make Rules. In this context it points to Section 94(2)(nn) from the 1965 Act which reads as follows:

Clause (nn) of sub­section (2) of Section 94 reads thus :

"94. Power to make Rules.­ (1) ... ... ... ...

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for­

(nn) any matter for which regulation may be made by the Board under Section 95;"

The above clause (nn) of sub­section (2) of Section 94 clearly confers power on the State Government to frame Rules in respect of any matter for which regulations can be framed by the Board.

On the other hand, the court says, "Clause (f) of sub­section (1) of Section 95 specifically empowers the Board to frame Regulations governing conditions of service of officers and servants of the Board. The reason is that the power to determine the service conditions of the other officers and servants has been conferred on the Board which can be exercised by making Regulations."

After a conjoint reading of the above provision, the court concludes as follows:

"27. In view of sub­section (2) of Section 95 read with clause (nn) of sub­section (2) of Section 94, Regulations, if any, framed by the Board for determining the conditions of services of its officers and servants are always subject to the Rules which may be framed by the State Government by exercising the power under clause (nn) of sub­section (1) of Section 94. Whenever there is any inconsistency between the Regulations framed under clause (f) of sub­section (1) of Section 95 and the Rules framed under clause (nn) of sub­ section (1) of Section 94, the Rules will prevail and to that extent, the provisions of the Regulations which are repugnant to the Rules shall be void. To put it differently, the power to determine the conditions of service of the officers (except the Housing Commissioner) and servants of the Board vests in the Board, and the said power can be exercised only by framing Regulations under clause (f) of sub section (1) of Section 95. So long as Rules are not framed by the State Government under clause (nn) of sub­ section (1) of Section 95 for overriding the provisions of the Regulations framed by the Board for prescribing the service conditions, the provisions of Regulations shall always govern the field. Except for the exercise of the Rule making power under clause (nn) of sub­section (1) of Section 94, there is no specific power conferred under the 1965 Act, or for that matter under the 1975 Act, on the State Government to nullify or to override the conditions of service of its officers and servants determined by the Board by the Regulations framed in the exercise of powers under clause (f) of sub­section (1) of Section 95."

FUNCTIONS OF THE BOARD

On the question of the function of the board, the court concluded as follows:

"30…The nature of the functions of a statutory body like the Board will always depend on the object of establishing such a body. The appointment of officers and servants needs to be made for the efficient performance of the specific functions of the Board. The exercise of power to appoint servants and officers of the Board and determination of their service conditions cannot constitute the functions of the Board. The powers under Chapter V and the power of appointing officers and servants under Sections 7 and 8 of Chapter II need to be exercised for ensuring proper discharge of the functions of the Board as well as for the exercise of the powers set out in Chapter III. We are, therefore, of the considered view that the appointment of officers and servants and determination of their service conditions cannot constitute functions of the Board."

POWER OF THE STATE GOVERNMENT TO ISSUE DIRECTIONS TO THE BOARD REGARDING THE DETERMINATION OF THE SERVICE CONDITIONS OF THE BOARD

The issue for consideration before the court was whether the State Government can exercise its power to override statutory Regulations framed by the Board. The court concluded as follows:

As the scheme of the 1965 Act specifically provides that Regulations framed under Section 94 can be overridden by framing Rules in accordance with clause (nn) of sub­section (1) of Section 94, the act of overriding the Regulations must be done only by framing the Rules and not in any other manner. This view is supported by a series of decisions of this Court taking a consistent view that where an enactment requires to do a certain thing in a certain way, the thing must be done in that way and in no other manner. There are several decisions taking that view ending with the decision of this Court in the case of Gujarat Urja Vikas Nigam. However, the locus classicus on this point is the well known decision of the Privy Council in the case of Nazir Ahmed v. The King Emperor. The upshot of the aforesaid discussion is that the State Government has no power to issue directions under sub­section (2) of Section 92 to nullify or override the Regulations framed by the Board in the exercise of powers under clause (f) of sub­section (1) of Section 95.

At the end, the court answered the three questions in the following manner:

(1) The decision lays down the correct proposition of law.

(2) The first part of the question is answered in the affirmative. The functions of the Board are as specified in Section 15 and other relevant sections in Chapter III of the 1965 Act. The second part is answered in the negative.

(3) Answered in affirmative. But the State Government can always frame Rules in the exercise of powers under clause (nn) of sub section (1) of Section 94 of the 1965 Act for determining the conditions of service of the servants and officers of the Board. Whenever there is any inconsistency between Regulations framed under clause (f) of sub­section (1) of Section 95 and the Rules framed under clause (nn) of sub­section (1) of Section 94, the Rules will prevail and to that extent, the provisions of the Regulations which are repugnant to the Rules shall be void.

Case Title: State of U.P. & Ors. vs. Virendra Kumar & Ors. CIVIL APPEAL NOS.6622­6623 OF 2022

Citation : 2022 LiveLaw (SC) 1001

For Appellant(s) Ms. Aishwarya Bhati, Ld. ASG Mr. V.K. Shukla, Sr. Adv. Ms. Nithin Pavuluri, Adv. Ms. B.L.N. Shivani, Adv. Mr. Rajeev Kumar Dubey, Adv. Mr. Kamlendra Mishra, AOR Mr. Vishwajit Singh, Sr. Adv. Mr. Abhishek Kumar Singh, AOR Ms. Pallavi Baghel, Adv. Ms. Anamika Yadav, Adv. Mr. Pankaj Singh, Adv.

For Respondent(s) Mr. Nidhesh Gupta, Sr. Adv. Mr. Nikhil Majithia, AOR Ms. Japneet Kaur, Adv. Ms. Vriti Gujral, Adv. Mr. P. K. Jain, AOR Mr. Saurabh Jain, Adv. Mr. P.K. Goswami, Adv. Mr. S.P. Singh Rathore, Adv. Mr. Vishwajit Singh, Sr. Adv. Mrs. Veera Kaul Singh, Adv. Mr. Pankaj Singh, Adv. Mr. Abhishek Kumar Singh, AOR Ms. Ridhima Singh, Adv. 2 Mr. Vignesh Singh, Adv. Mr. Jitendra Mohan Sharma, Sr. Adv. Mr. Ajit Sharma, Adv. Mr. Amrit Pradhan, Adv. Mr. Sandeep Singh, Adv. Mr. Sanpreet Singh Ajmani, Adv.

Uttar Pradesh Avas Evam Vikas Parishad Adhiniyam, 1965 - UP Housing and Development Board's function does not include fixing its employees' service conditions- Judgment in State of U.P. vs. Preetam Singh & Ors. 2014 (15) SCC 774 approved.

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