{"id":221160,"date":"1990-09-04T00:00:00","date_gmt":"1990-09-03T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/delhi-transport-corporation-vs-d-t-c-mazdoor-congress-on-4-september-1990"},"modified":"2016-11-21T22:22:07","modified_gmt":"2016-11-21T16:52:07","slug":"delhi-transport-corporation-vs-d-t-c-mazdoor-congress-on-4-september-1990","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/delhi-transport-corporation-vs-d-t-c-mazdoor-congress-on-4-september-1990","title":{"rendered":"Delhi Transport Corporation vs D.T.C. Mazdoor Congress on 4 September, 1990"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Delhi Transport Corporation vs D.T.C. Mazdoor Congress on 4 September, 1990<\/div>\n
Equivalent citations: 1991 AIR 101, \t\t 1990 SCR Supl. (1) 142<\/div>\n
Author: S Mukharji<\/div>\n
Bench: Mukharji, Sabyasachi (Cj), Ray, B.C. (J), Sharma, L.M. (J), Sawant, P.B., Ramaswamy, K.<\/div>\n
           PETITIONER:\nDELHI TRANSPORT CORPORATION\n\n\tVs.\n\nRESPONDENT:\nD.T.C. MAZDOOR CONGRESS\n\nDATE OF JUDGMENT04\/09\/1990\n\nBENCH:\nMUKHARJI, SABYASACHI (CJ)\nBENCH:\nMUKHARJI, SABYASACHI (CJ)\nRAMASWAMY, K.\nRAY, B.C. (J)\nSHARMA, L.M. (J)\nSAWANT, P.B.\n\nCITATION:\n 1991 AIR  101\t\t  1990 SCR  Supl. (1) 142\n 1991 SCC  Supl.  (1) 600 JT 1990 (3)\t725\n 1990 SCALE  (2)1\n CITATOR INFO :\n D\t    1992 SC1072\t (4)\n\n\nACT:\n    Service  Law:  Delhi Road Transport Act,  1950:  Section\n53\/Delhi  Road Transport Authority) (Conditions of  Appoint-\nment and Service) Regulations, 1952--Regulation 9(b)\/Shastri\nAward---Para  522\/District Board Rules, 1926,  Part  V--Rule\n1(1)\/Indian   Airlines\tEmployees'   Regulations--Regulation\n13\/Air India Employees' Regulations--Regulation 48--Validity\nof--Termination\t of  service of permanent  employee  without\nassigning  any\treasons and holding  enquiry--Whether  arbi-\ntrary,\tunfair, unjust, unreasonable and opposed  to  public\npolicy-Whether violative of Articles 12, 14, 16, 19, 31\t and\n311(2)\tof the Constitution of India, principles of  natural\njustice\t and  Section 23 of  Contract  Act,  1872--Statutory\ncorporations--Power  to\t terminate  services  of   employees\nwithout holding enquiry--Validity of.\n    Contract  Act, 1872: Section 23--Contract providing\t for\ntermination  of\t service without notice and holding  of\t en-\nquiry--Whether enforceable.\n    Constitution of India, 1950: Articles 14, 16, 19(1) (g),\n21 and 311(2)--Termination of service of an employee without\nassigning reasons and holding enquiry--Whether violative  of\nFundamental Rights and principles of natural  justice--Regu-\nlations\/Rules-- Validity of.\n    Article 141.' Expressions \"declared\" and \"found or made\"\n--Scope and ambit of.\n    Interpretation  of Statutes: Internal aid  to  construc-\ntion--Doctrine\tof  reading  down--Scope  and  Applicability\nof--Provision illegal and invalid--Whether could be validat-\ned    by   reading   down--Where   provision\tclear\t and\nunambiguous--Whether  permissible  to  read  down  into\t the\nprovision something which was not intended.\n    Public    Policy\tvis-a-vis    constitutionality\t  of\nstatute--Whether public policy can be drawn from the Consti-\ntution--Whether constitutional policy provides an  aid--Role\nand purpose of constitutional interpretation by apex court.\n143\n    Administrative    Law--Discretionary     power--Exercise\nof--Limitations-Absence of arbitrary power--First  essential\nof Rule of Law.\n\n\n\nHEADNOTE:\n    Respondents No. 2 to 4, regular employees of the  appel-\nlant Delhi Transport Corporation, were served with  termina-\ntion notices under Regulation 9(b) of the Delhi Road  Trans-\nport Authority (Conditions of Appointment & Service) Regula-\ntions, 1952 by the appellant Corporation on the ground\tthat\nthey  became inefficient in their work and started  inciting\nother members not to perform their duties.\n    The three respondents and their Union, respondent No.  1\nfiled writ petition in High Court, challenging the constitu-\ntional\tvalidity of Regulation 9(b), which gave the  manage-\nment  right  to\t terminate the services of  an\temployee  by\ngiving one month's notice or pay in lieu thereof. The  Divi-\nsion  Bench  of the High Court struck down  the\t Regulation,\nholding\t that  the Regulation gave absolute,  unbridled\t and\narbitrary powers to the management to terminate the services\nof  any permanent or temporary employee, and such power\t was\nviolative  of  Article 14 of the  Constitution.\t Hence,\t the\nCorporation  filed the appeal before this Court, by  special\nleave.\n    The\t validity of similar provisions in Para 522  of\t the\nShastri\t Award, rule 1(i) of the District Board Rules  1926,\nPart V, Regulation 13 of Indian Airlines Employees'  Service\nRegulations,  Regulation 48 of Air India Employees'  Service\nRegulations and also the clause in the contract of  appoint-\nment  in respect of employees of Zilla Parishad and the\t New\nIndia  Assurance Company, also came up for consideration  in\nthe  connected\tappeals and applications filed\tbefore\tthis\nCourt.\n    It was contended on behalf of the Delhi Transport Corpo-\nration\tthat  there was sufficient guideline  in  Regulation\n9(b) and the power of termination, properly read, would\t not\nbe arbitrary or violative of Article 14 of the Constitution,\nthat the Court would be entitled to obtain guidance from the\npreamble,  the\tpolicy and the purpose of the  Act  and\t the\npower  conferred  under\t it and to see that  the  power\t was\nexercised  only\t for  that purpose, that even  a  term\tlike\n'public interest' could be sufficient guidance in the matter\nof retirement of a government employee, and such a provision\ncould be read into a statute even when it was not  otherwise\nexpressly  there,  that it was well-settled that  the  Court\nwould  sustain the presumption of constitutionality by\tcon-\nsidering  matters  of common knowledge and to  assume  every\nstate of facts which could be conceived and could even\tread\ndown  the  section,  if it became necessary  to\t uphold\t the\nvalidity of the provision, that the underlying\n144\nrationale of this rule of interpretation, or the doctrine of\nreading\t down  of a statute being that when  a\tlegislature,\nwhose  powers were not unlimited, enacted a statute, it\t was\naware  of  its limitations, and in the\tabsence\t of  express\nintention  or  clear language to the contrary,\tit  must  be\npresumed  to  have implied into the  statute  the  requisite\nlimitations and conditions to immunise it from the virus  of\nunconstitutionality,  that since every legislature  intended\nto  act\t within\t its powers, in a  limited  Government,\t the\nlegislature  would  attempt to function within\tits  limited\npowers\tand  it would not be expected to  have\tintended  to\ntransgress its limits, that the guidelines for the  exercise\nof  the\t power of termination simpliciter  under  Regulation\n9(b) could be found in the statutory provisions of the\t1950\nAct under which the regulations had been framed, the  pream-\nble; Sections 19, 20 and 53, the context of Regulation\t9(b)\nread  with Regulations 9(a) and 15, that even for the  exer-\ncise of this power, reasons could be recorded although\tthey\nneed  not be communicated which would ensure a check on\t the\narbitrary exercise of power and effective judicial review in\na given case, ensuring efficient running of services and  in\npublic interest and the regulations in question were  paral-\nlel  to, but not identical with, the exceptions\t carved\t out\nunder  proviso\tto Article 311(2), that even  the  power  of\ntermination simipliciter under Regulation 9(b) could only be\nexercised  in circumstances other than those  in  Regulation\n9(a),  i.e. not where the foundation of the order was  'mis-\nconduct',  the\texercise  of such power could  only  be\t for\npurposes  germane  and\trelevant to the\t statute,  that\t the\nprinciples  of natural justice or holding of an\t enquiry  is\nneither\t a  universal principle of  justice  nor  inflexible\ndogma and the principles of natural justice were not incapa-\nble  of\t exclusion in a given situation,  if  importing\t the\nright to be heard has the effect of paralysing the  adminis-\ntrative\t process or the need for promptitude or the  urgency\nof  the-  situation  so demands, natural  justice  could  be\navoided;  that the words \"where it is not  reasonably  prac-\nticable to hold an enquiry\" may be imported into the regula-\ntion, that where termination took place by the exclusion  of\naudi alteram partem rule in circumstances which were circum-\nscribed\t and  coupled  with the safeguard  of  recording  of\nreasons\t which were germane and relevant, then the  termina-\ntion  would not render the regulation unreasonable or  arbi-\ntrary,\tand  if the regulation was read in  this  manner  it\ncould not be said that the power was uncanalised or  unguid-\ned,  that  under ordinary law of \"master  and  servant\"\t the\nCorporation  was  empowered by the Contract  of\t Service  to\nterminate  the services of its employees in  terms  thereof;\nthe  Declaration in Brojo Nath's case that such\t a  contract\nwas  void  under section 23 of the Indian  Contract  Act  or\nopposed\t to public policy offending the\t Fundamental  Rights\nand  the  Directive Principles was not sound in\t law;  as  a\nmaster, the Corporation had unbridled right\n145\nto  terminate  the contract in the  interests  of  efficient\nfunctioning  of\t the Corporation or to\tmaintain  discipline\namong its employees, and if the termination, was found to be\nwrongful, the only remedy available to the employees was  to\nclaim damages for wrongful termination but not a declaration\nas was granted in Brojo Nath's case.\n    On\tbehalf of the workmen\/intervenors, it was  submitted\nthat  provision of any rule that service would be liable  to\ntermination  on\t notice for the\t period\t prescribed  therein\ncontravened Article 14 of the Constitution, as arbitrary and\nuncontrolled  power was left in the authority to  select  at\nits will any person against whom action would be taken; that\nArticles 14, 19 and 21 were inter-related and Article 21 did\nnot exclude Article 19 and even if there was a law providing\na  procedure for depriving a person of personal liberty\t and\nthere was, consequently no infringement of fundamental right\nconferred  by Article 21, such law in so far as it  abridged\nor  took away any fundamental right under Article  19  would\nhave  to meet the challenge of that Article, that  violation\nof  principle of natural justice by State action was  viola-\ntion  of Article 14 which could be excluded only  in  excep-\ntional circumstances, and, therefore, a clause which  autho-\nrised the employer to terminate the services of an employee,\nwhose contract of service was for indefinite period or\ttill\nthe age of retirement, by serving notice, and which did\t not\ncontain\t any  guidance\tfor the exercise of  the  power\t and\nwithout recording reasons for such termination, violated the\nfundamental  rights guaranteed under Articles  14,  19(1)(g)\nand 21 and principles of natural justice and was void  under\nSection 2(g) of the Indian Contract Act, 1872, and  unforce-\nable under Section 2(hi; that since audi alteram partem\t was\na  requirement\tof Article 14. and conferment  of  arbitrary\npower  itself was contrary to Article 14, the rule in  ques-\ntion could not be sustained as valid; that the Constitution-\nal guarantees under Articles 14 and 21 were for all  persons\nand there could be no basis for making a distinction between\n'workmen'  to  whom the Industrial Disputes  Act  and  other\nindustrial  laws  applied and those who were  outside  their\npurview, and the law applicable to the former could only add\nto and not detract from the rights guaranteed by Part 111 of\nthe  Constitution; that the power to terminate the  services\nof  a person employed to serve indefinitely or till the\t age\nof  retirement\tcould be exercised only in cases  of  proved\nmisconduct or exceptional circumstances having regard to the\nConstitutional\t guarantee  available  under   Article\t 14,\n19(1)(g)  and  21 and unless the  exceptional  circumstances\nwere  spelt out, the power to terminate the  services  would\ncover  both permissible and impermissible grounds  rendering\nit wholly invalid, particularly because, the requirement  of\naudi alteram partem which was a part of the guarantee of\n146\nArticle 14 was sought to be excluded, and there could be  no\nguidance available in the body of the law itself, since\t the\npurpose\t for  which an undertaking was established  and\t the\nprovisions dealing with the same in the law could provide no\nguidance  regarding  exceptional circumstances\tunder  which\nalone  the power could be exercised, that the  question\t in-\nvolved,\t in the instant cases was not the exercise of  power\nwhich an employer possessed to terminate the services of his\nemployee,  but the extent of that power; that provisions  of\nRegulation  9(b)  of  the  Delhi  Road\tTransport  Authority\n(Conditions  of Appointment and Service) Regulations,  1952,\ncould not be rendered constitutional by reading the require-\nment of recording reasons and confining it to cases where it\nwas not reasonably practicable to hold an enquiry and  read-\ning it down further as being applicable to only\t exceptional\ncases would not be permissible construction and proper; that\nthe  Regulation conferred arbitrary power of leaving  it  to\nthe  DTC  Management to pick and choose, either to  hold  an\nenquiry\t or terminate the services for the  same  misconduct\nand  there was nothing in the provisions of the Act  or\t the\nregulations  from which the Management could find any  guid-\nance  and, therefore, in order to conform to  the  constitu-\ntional guarantees contained in Articles 14, 19(1)(g) and 21,\nthe  regulation\t would have to make  a\tdistinction  between\ncases  where services were sought to be terminated for\tmis-\nconduct and cases of termination on grounds other than\twhat\nwould  constitute misconduct; that regulation 9(b)  deliber-\nately conferred wide power of termination of service without\ngiving reasonable opportunity to an employee even if he\t was\nregular or permanent employee, in addition to regulation  15\nwhich provided for dismissal or removal after a disciplinary\nenquiry,  thus, the intention of the  regulation-making\t au-\nthority\t was  clear and unambiguous; the provision  was\t not\ncapable of two interpretations, and consequently, the  ques-\ntion of reading down did not arise, and reading down in\t the\ninstant cases involved not interpretation of any single word\nin  regulation 9(b) but adding a whole clause to  it,  which\namounted  to  rewriting\t the provisions,  which\t courts\t had\nrefused to make up for the omission of the legislature,\t and\nwould  inevitably drain out Article 14 of its vitality,\t and\nthe right to equality which was regarded as a basic  feature\nof the Constitution, and subject permanent employees of\t the\nDTC to a tremendous sense of insecurity which is against the\nphilosophy  and scheme of the Constitution, that unless\t the\nprovision of the Constitution itself excluded the principles\nof  natural justice, they continued to be applicable  as  an\nintegral  part\tof the right to equality guaranteed  by\t the\nConstitution,  that  as the employees of the  DTC  were\t not\nGovernment employees, Article 311(2) was not applicable, and\nArticle\t 14 fully applied to them, including the  principles\nof natural justice.\n147\n    On behalf of the Indian Airlines Corporation and the Air\nIndia, which filed intervention applications, it was submit-\nted  that there had been distinction between  the  discharge\nsimpliciter and dismissal from service by way of punishment,\nthat  the effect of the judgments of this Court in the\tCen-\ntral Inland Water's case and West Bengal's case was to\ttake\naway the right of the employer to terminate the services  of\nan employee by way of discharge simpliciter, that this Court\nhad  recognised\t the existence of the inherent right  of  an\nemployer  to terminate the services of an employee in  terms\nof  the\t contract of employment and also under\tthe  various\nlabour\tenactments,  that  a plain reading  of\tthe  amended\nRegulation 13 of the Indian Airlines Employees'\t Regulations\nand  a cumulative reading of the amended regulations 48\t and\n44  of the Air India Employees Service\tRegulations  clearly\nestablished that the vice, if any, of arbitrariness had been\ncompletely removed and that the power to terminate had\tbeen\nvested\twith the Board of Directors, and not with any  indi-\nvidual,\t and  sufficient guidelines made  available  to\t the\nBoard to exercise the restricted and limited power available\nto the employer under these regulations.\n    On\tbehalf\tof another intervenor, New  India  Assurance\nCo.,  it was submitted that the Central Inland Water's\tcase\nwas erroneous, insofar as it made complete negation of power\nof  the employer to terminate and rendered  the\t termination\nillegal\t even where the employer had made all the  necessary\ninvestigation  and  had given hearing to the  employee\tcon-\ncerned\tbefore\tmaking the order, and took in  even  private\nemployment; therefore, the judgment of this Court should  be\nread down and made applicable prospectively.\n    In\tCivil  Appeal No. 4073 of 1986 it was  contended  on\nbehalf\tof the Bank employee whose services were  terminated\nunder  para 522 of the Shastri Award, that mere\t failure  of\nthe  employee to mention the loan taken by him from  another\nbranch\tof  the\t Bank, which was  repaid  subsequently,\t had\ndeprived him of his livelihood, and his services were termi-\nnated without charge of 'misconduct' and without an enquiry,\nand paragraph 522 of the Shastri Award gave no indication as\nto  on\twhat conditions this  arbitrary\t uncontrolled  power\ncould be used to get rid of one or more permanent  employees\nfor  \"efficient management of Banks\" on subjective  opinions\nor suspicion not tested in enquiry into facts, and that this\nprovision  provided for \"insecurity of tenure\" for lakhs  of\npermanent  employees; Articles 14, 19(1)(g) and 21  and\t the\nintegrated  protection of these Fundamental Rights  excluded\nthe  \"doctrine\tof  pleasure\" and insisted  on\tsecurity  of\ntenure \"during good behaviour\", and the right to  livelihood\ncould not be rendered precari-\n148\nous or reduced to a \"glorious 'uncertainty\", that no princi-\nple of interpretation permitted reading down a provision  so\nas to make it into a different provision altogether  differ-\nent  from what was intended by the legislature or its  dele-\ngate,  and  there could not be any reading  down  which\t was\ncontrary  to the principles of interpretation; that  if\t two\nprovisions  existed,  firstly to remove from  service  after\nholding an enquiry on a charge of 'misconduct' and secondly,\nwithout\t serving a charge-sheet or holding an  enquiry,\t all\nprovisions for holding enquiry would be rendered otiose\t and\nwould be reduced to a mere redundancy, that the Court had  a\nduty  to correct wrongs even if orders had been\t made  which\nwere  later found to be violative of any  fundamental  right\nand  to recall its orders to avoid injustice; that  substan-\ntive  provision of para 522 could not be controlled or\tcur-\ntailed\teffectively  so as to confine its  operation  within\nnarrow\tconstitutional limits; that it was not the  duty  of\nthe  court  to condone the constitutional  delinquencies  of\nthose  limited by the Constitution if they arrogated  uncon-\ntrolled\t unconstitutional powers, which were neither  neces-\nsary nor germane for supposed efficiency of services in\t the\nBanks  as a business enterprise, and that in a\tsystem\tgov-\nerned by rule of law, discretion when conferred upon  execu-\ntive  authorities  must be confined within  clearly  defined\nlimits.\n    In Civil Appeal No. I 115 of 1976, the appellant-employ-\nee  of\tthe Zila Parishad contended that his  services\twere\nterminated  on account of the vindictiveness of some of\t the\nemployees  of the respondent, and without enquiry.  The\t em-\nployer\tsubmitted that the termination order was  passed  on\nthe  basis of the condition in the mutually agreed terms  of\ncontract of appointment, and resolution passed by the Board,\nand  that  Rule 1(i) of District Board Rules, 1926,  Part  V\ngave  right to both the parties to terminate the  employment\non one month's notice.\n    On\tthe  questions (i) whether Regulation  9(b)  of\t the\nDelhi  Road Transport Authority (Conditions  of\t Appointment\nand  Service)  Regulations, 1952,  was\tarbitrary,  illegal,\ndiscriminatory\tand violative of audi alteram partem and  so\nconstitutionally  invalid  and void; and  (ii)\twhether\t the\nRegulation  could  be interpreted and read down\t in  such  a\nmanner\tas to hold that it was not discriminatory, or  arbi-\ntrary and did not confer unbriddled and uncanalised power on\nthe  authority\tto  terminate the service  of  an  employee,\nincluding a permanent employee, without any reason whatsoev-\ner.\n    Dismissing Civil Appeal No. 2876 of 1986 (appeal by\t the\nDelhi Transport Corporation), allowing Civil Appeal No. 1115\nof  1976, and directing other matters to be placed before  a\nDivision Bench, in ac-\n149\ncordance with the majority decision (per Ray, Sharma, Sawant\nand K. Ramaswamy, JJ.) this Court,\nHELD: Per Ray, J.:\n    1. I Regulation 9(b) of the Delhi Road Transport Author-\nity  (Conditions  of Appointment and  Service)\tRegulations,\n1952 which confers powers on the authority to terminate\t the\nservices of a permanent and confirmed employee by issuing  a\nnotice terminating the services or by making payment in lieu\nof  notice  without assigning any reasons in the  order\t and\nwithout\t giving any opportunity of hearing to  the  employee\nbefore\tpassing the orders is wholly arbitrary,\t uncanalised\nand unrestricted violating principles of natural justice  as\nwell  as Article 14 of the Constitution. There is no  guide-\nline  in  the  Regulations or in the  Delhi  Road  Transport\nAuthority Act, 1950 as to when or in which cases and circum-\nstances this power of termination by giving notice or pay in\nlieu thereof can be exercised. [264G, 285C]\n    1.2\t Government Companies or Public\t Corporations  which\ncarry  on trade and business activity of State\tbeing  State\ninstrumentalities,  are State within the meaning of  Article\n12  of the Constitution and as such they are subject to\t the\nobservance  of\tfundamental rights embodied in Part  111  as\nwell as to conform to the directive principles in Part IV of\nthe Constitution. In other words, the Service Regulations or\nRules  framed by them are to be tested by the touchstone  of\nArticle\t 14 of the Constitution. Furthermore, the  procedure\nprescribed by their Rules or Regulations must be reasonable,\nfair and just and not arbitrary, fanciful and unjust. [264H,\n265A-B]\n    1.3\t The 'audi alteram partem' rule which,\tin  essence,\nenforces the equality clause in Article 14 of the  Constitu-\ntion is applicable not only to quasi-judicial orders but  to\nadministrative orders affecting prejudicially the  party-in-\nquestion  unless  the application of the rule has  been\t ex-\npressly\t excluded by the Act or Regulation or Rule which  is\nnot  the case here. Rules of natural justice do no  supplant\nbut supplement the Rules and Regulations. Moreover, the Rule\nof  Law, which permeates the Constitution of India,  demands\nthat   it  has\tto  be\tobserved  both\t substantially\t and\nprocedurally.  Rule  of\t law posits that  the  power  to  be\nexercised in a manner which is just, fair and reasonable and\nnot  in\t an  unreasonable, capricious  or  arbitrary  manner\nleaving room for discrimination. [265D-E]\nRegulation  9(b) does not expressly exclude the\t application\nof the\n150\n'audi alteram parterm' rule and as such the order of  termi-\nnation\tof service of a permanent employee cannot be  passed\nby  simply issuing a month's notice or pay in  lieu  thereof\nwithout recording any reason in the order and without giving\nany hearing to the employee to controvert the allegation  on\nthe basis of which the purported order is made. [265F]\n    1.4\t Considering from all these aspects Regulation\t9(b)\nis illegal and void, as it is arbitrary, discriminatory\t and\nwithout any guidelines for exercise of the power. It confers\nunbridled, uncanalised and arbitrary power on the  authority\nto  terminate the services of a permanent  employee  without\nrecording any reasons and without conforming to the  princi-\nples of natural justice. It is also void under Section 23 of\nthe Contract Act, as being opposed to public policy and also\nultra vires of Article 14 of the Constitution. [265E,  265B-\nC, 266G]\n    Moti  Ram  Deka Etc. v. General Manager,  NEF  Railways,\nMaligaon.  Pandu,  Etc.,<\/a>  [1964] 5 SCR\t683;  Parshotam\t Lal\nDhingra v. Union of India,<\/a> [1958] SCR 828; Shyam Lal v.\t The\nState  of  Uttar Pradesh and Anr., [1955] SCR 26;  Shri\t Ram\nKrishna Dalmia v. Shri Justice S.R. Tendolkar & Ors.,<\/a> [1959]\nSCR  279; Jyoti Pershad v. The Administrator<\/a> for  the  Union\nTerritory of Delhi, [1962] 2 SCR 125; State of Orissa v. Dr.\n(Miss) Binapani Devi & Ors.,<\/a> [1967] 2 SCR 625; A.K.  Kraipak\nJUDGMENT:\n<\/pre>\n
of India v. Col. J.N. Sinha and Anr., [1971] 1 SCR 791;\t Air
\nIndia  Corporation  v. V.A. Rebello & Ant.,  AIR  1972\tS.C.
\n1343; The Workmen of Sudder Office Cinnamara v. The  Manage-
\nment, [1971] 2 Lab LJ 620; Tata Oil Mills Co. Ltd. v.  Work-
\nmen  &\tAnr., [1964] 2 SCR 125; Maneka Gandhi  v.  Union  of
\nIndia,<\/a> [1978] 2 SCR 621; E.P. Royappa v. State of Tamil Nadu
\nand Anr..<\/a> [1974] 2 SCR 348; Municipal Corporation of Greater
\nBombay\tv. Malvenkar & Ors.,<\/a>  [1978] 3 SCR 1000; Manohar  P.
\nKharkher and Anr. v. Raghuraj & Anr., [1981] 2 LLJ 459;\t 1..
\nMichael\t & Anr. v. Johnaton Pumps India Ltd.,<\/a> [1975]  3\t SCR
\n489; Sukhdev Singh & Ors. v. Bhagat Ram Sardar Singh  Raghu-
\nvanshi & Anr., [1975] 1 SCC 421; S.S. Muley v. J.R.D. Tata &
\nOrs., [1979] 2 SLR 438; West Bengal State Electricity  Board
\n&  Ors.\t v. Desh Bandhu Ghosh and Ors.,<\/a> [1985]\t3  SCC\t116;
\nWorkmen Of Hindustan Steel Ltd. and Anr. v. Hindustan  Steel
\nLtd.  and  Ors.,<\/a> [1985] 2 SCR 428; O.P. Bhandari  v.  Indian
\nTourism\t Development Corporation Ltd. & Ors.,<\/a> [1986]  4\t SCC
\n337; Central Inland Water Transport Corporation Ltd. &\tAnr.
\nv.  Brojo  Nath Ganguly & Anr.,<\/a> [1986] 3 SCC 156  and  Delhi
\nTransport  Undertaking\tv. Balbir Saran Goel,<\/a> [1970]  3\t SCR
\n757, referred to.\n<\/p>\n
2.1 An Act can be declared to be valid wherein any term\t has
\nbeen
\n151<\/span>
\nused which per se seems to be without jurisdiction, but\t can
\nbe read’ down in order to make it constitutionally valid  by
\nseparating  and\t excluding the part which is invalid  or  by
\ninterpreting  the word in such a fashion as to make it\tcon-
\nstitutionally valid and within jurisdiction of the  legisla-
\nture  which passed the said enactment, by reading  down\t the
\nprovisions  of\tthe Act. This however, does  not  under\t any
\ncircumstances, mean that where the plain and literal meaning
\nthat  follows from a bare reading of the provisions  of\t the
\nAct,  Rule or Regulations that it confers arbitrary  uncana-
\nlised,\tunbridled unrestricted power to terminate the  serv-
\nices  of a permanent employee without recording any  reasons
\nfor  the  same\tand without adhering to\t the  principles  of
\nnatural justice and equality before the law as envisaged  in
\nArticle 14 of the Constitution, it can be read down to\tsave
\nthe said provision from constitutional invalidity, by bring-
\ning or adding words in the said legislation, such as  saying
\nthat  it implies that reasons for the order  of\t termination
\nhave to be recorded. [271C-F]
\n    2.2 In interpreting the provisions of an Act, it is\t not
\npermissible where the plain language of the provision  gives
\na  clear and unambiguous meaning that it can be\t interpreted
\nby  reading down and presuming certain expressions in  order
\nto save it from constitutional invalidity. Therefore, it  is
\nimpossible to hold by reading down the provisions of Regula-
\ntion  9(b) framed under section 53 of the Delhi Road  Trans-
\nport  Act, 1950 read with Delhi Road  Transport\t (Amendment)
\nAct, 1971 that the said provision does not confer arbitrary,
\nunguided,  unrestricted\t and uncanalised power\twithout\t any
\nguidelines on the authority to terminate the services of  an
\nemployee  without  conforming to the principles\t of  natural
\njustice\t and  equality\tas envisaged in Article\t 14  of\t the
\nConstitution of India. [271F-H, 272A]
\n    Union  of India & Anr. v. Tulsiram Patel & Ors.,<\/a>  [1985]
\nSupp. 2 SCR 131; Roshan Lal Tandon v. Union of India,<\/a> [1968]
\n1 SCR 185; Commissioner of Sales Tax, Madhya Pradesh, Indore
\n&  Ors. v. Radhakrishan & Ors.,<\/a> [1979] 2 SCC 249; In Re\t The
\nHindu  Women’s Rights to Property Act, 1937, and  the  Hindu
\nWomen’s Rights to Property (Amendment) Act, 1938 and in Re a
\nSpecial\t Reference  under Section 213 of the  Government  of
\nIndia  Act, 1935, [1941] FCR 12; R.M.D.\t Chamarbaugwalla  v.
\nThe  Union of India,<\/a> [1957] SCR 930; R.L. Arora v. State  of
\nUttar Pradesh & Ors.,<\/a> [1964] 6 SCR 784 and The Mysore  State
\nElectricity  Board  v. Bangalore Woollen,  Cotton  and\tSilk
\nMills Ltd. & Ors.,<\/a> [1963] Supp. 2 SCR 127, Jagaish Pandey v.
\nThe  Chancellor of Bihar & Anr., [1968] 1 SCR 231,  referred
\nto.\n<\/p>\n
    H.N.  Seervai: Constitutional Law of India,\t Third\tEdi-
\ntion, p. 119, referred to.\n<\/p>\n
152<\/span><\/p>\n
Per Sharma, J.\n<\/p>\n
    1.1\t The  rights  of the parties in\t the  present  cases
\ncannot\tbe governed by the general principle of\t master\t and
\nservant,  and  the management cannot have  unrestricted\t and
\nunqualified power of terminating the services of the employ-
\nees.  In  the interest of efficiency of the  public  bodies,
\nhowever,  they\tshould have the authority to  terminate\t the
\nemployment  of undesirable, inefficient,  corrupt,  indolent
\nand disobedient employees, but it must be exercised  fairly,
\nobjectively  and  independently; and the  occasion  for\t the
\nexercise  must\tbe  delimited with  precision  and  clarity.
\nFurther, there should be adequate reason for the use of such
\na power, and a decision in this regard has to be taken in  a
\nmanner\twhich should show fairness, avoid arbitrariness\t and
\nevoke  credibility. And this is possible only when  the\t law
\nlays  down  detailed guidelines in unambiguous\tand  precise
\nterms so as to avoid the danger of misinterpretation of\t the
\nsituation.  An element of uncertainty is likely to  lead  to
\ngrave  and undesirable consequences. Clarity  and  precision
\nare. therefore, essential for the guidelines. [272D-F]
\n    1.2 Regulation 9(b) of the Delhi Road Transport Authori-
\nty  (Condition of Appointment and Service) Regulation,\t1952
\ncannot, therefore. be upheld for lack of adequate and appro-
\npriate guidelines. [272G]
\nPer Saw,ant, J.\n<\/p>\n
    1.1.  There is need to minimise the scope of  the  arbi-
\ntrary  use of power in all walks of life. It is\t inadvisable
\nto  depend  on the good sense of  the  individuals.  however
\nhigh-placed  they  may be. It is all the more  improper\t and
\nundesirable to expose the precious rights like the rights of
\nlife. liberty and property to the vagaries of the individual
\nwhims  and fancies. It is trite to say that individuals\t are
\nnot and do not become wise because they occupy high seats of
\npower, and good sense, circumspection and fairness do not go
\nwith  the posts, however high they may be. There is  only  a
\ncomplaisant  presumption  that those who occupy\t high  posts
\nhave  a\t high sense of responsibility.\tThe  presumption  is
\nneither legal nor rational. History does not support it\t and
\nreality\t does  not warrant it. In particular, in  a  society
\npledged\t to uphold the rule of law, it would be both  unwise
\nand impolitic to leave any aspect of its life to be governed
\nby discretion when it can conveniently and easily be covered
\nby the rule of law. [276E-F]
\n    1.2\t Beyond the self-deluding and self-asserting  right-
\neous  presumption,  there is nothing to\t support  the  ‘high
\nauthority’ theory. This
\n153<\/span>
\ntheory\tundoubtedly weighed with some authorities  for\tsome
\ntime in the past. But its unrealistic pretensions were\tsoon
\nnoticed and it was buried without even so much as an ode  to
\nit. [278A-B]
\n    1.3\t The employment under the public undertakings  is  a
\npublic employment and a public property. It is not only\t the
\nundertakings but also the society which has a stake in their
\nproper\tand efficient working. Both discipline and  devotion
\nare  necessary for efficiency. To ensure both,\tthe  service
\nconditions  of those who work for them must be\tencouraging,
\ncertain\t and  secured,\tand not vague  and  whimiscal.\tWith
\ncapricious service conditions, both discipline and  devotion
\nare endangered, and efficiency is impaired. [276G-H, 277A]
\n    1.4 The right to life includes right to livelihood.\t The
\nright  to livelihood, therefore, cannot hang on to the\tfan-
\ncies  of individuals in authority. The employment is  not  a
\nbounty\tfrom  them nor can its survival be at  their  mercy.
\nIncome is the foundation of many fundamental rights and when
\nwork is the sole source of income, the right to work becomes
\nas much fundamental. Fundamental rights can ill-afford to be
\nconsigned  to the limb of undefined premises  and  uncertain
\napplications. That will be a mockery of them. [277B]
\n    1.5 Both the society and the individual employed, there-
\nfore,  have an anxious interest in service conditions  being
\nwell-defined and explicit to the extent possible. The  arbi-
\ntrary rules which are also sometimes described as Henry VIII
\nRules, can have no place in any service conditions. [277C]
\n    Sukhdev  Singh & Ors. v. Bhagatram Sardar  Singh  Raghu-
\nvanshi\t& Anr., [1975] 3 SCR 619; Maneka Gandhi v. Union  of
\nIndia,<\/a>\t[1978]\t2 SCC 621; The\tManager,  Government  Branch
\nPress & Ant. v. D.R. Belliappa, [1979] 1 SCC 477; The Manag-
\ning  Director, Uttar Pradesh Warehousing Corporation &\tAnr.
\nv.  Vinay Narayan Vajpayee,<\/a> [1980] 2 SCR 773; A.L. Kalra  v.
\nThe Project & Equipment Corporation of India Ltd.,<\/a> [1984]  3
\nSCR 646; Workmen of Hindustan Steel Ltd. & Anr. v. Hindustan
\nSteel  Ltd.  &\tOrs.,<\/a> [1985] 2 SCR 428;\t West  Bengal  State
\nElectricity Board & Ors. v. Desh Bandhu Ghosh & Ors.,<\/a> [1985]
\n2 SCR 1014; Olga Tellis & Ors. v. Bombay Municipal  Corpora-<\/a>
\ntion  & Ors. etc., [1985] Supp. 2 SCR 51; Union of  India  &
\nAnr.  v. Tulsiram Patel<\/a>& Ors., [1985] Supp. 2 SCR 131;\tCen-
\ntral Inland Water Transport Corporation Ltd. & Anr. v. Brojo
\nNath Ganguly & Anr.<\/a> etc., [1986] 3 SCR 156; O.P. Bhandari v.
\nIndian Tourism Development Corporation Ltd. & Ors..<\/a> [1986] 4
\nSCC 337; N.C. Dalwadi v. State of Gujarat,<\/a> [1987] 3
\n154<\/span>
\nSCC 611; M.K. Agarwal v. Gurgaon Gramin Bank & Ors.,<\/a>  [1987]
\nSupp. SCC 643 and Daily Rated Casual Labour employed under P
\n&  T Department through Bhartiya Dak Tar Mazdoor Manch\tetc.
\nv. Union of India & Ors., [1988] 1 SCC 122, referred to.
\n    2.1\t The  doctrine of reading down or of  recasting\t the
\nstatute\t can be applied in limited situations. It is  essen-
\ntially used, firstly, for saving a statute from being struck
\ndown on account of its unconstitutionality. It is an  exten-
\nsion  of  the principle that when  two\tinterpretations\t are
\npossible–one  rendering  it constitutional  and  the  other
\nmaking it constitutional the former should be preferred. The
\nunconstitutionality may spring from either the\tincompetence
\nof  the legislature to enact the statute or from its  viola-
\ntion  of  any  of the provisions of  the  Constitution.\t The
\nsecond\tsituation which summons its aid is where the  provi-
\nsions  of  the\tstatute are vague and ambiguous\t and  it  is
\npossible to gather the intention of the legislature from the
\nobject\tof the statute, the context in which  the  provision
\noccurs\tand the purpose for which it is made. However,\twhen
\nthe provision is cast in a definite and unambiguous language
\nand its intention is clear, it is not permissible either  to
\nmend  or  bend it even if such recasting is in\taccord\twith
\ngood reason and conscience. In such circumstances, it is not
\npossible for the Court to remake the statute. Its only\tduty
\nis  to strike it down and leave it to the legislature if  it
\nso  desires, to amend it. If the remaking of the statute  by
\nthe courts is to lead to its distortion that course is to be
\nscrupulously avoided. The doctrine can never be called\tinto
\nplay  where  the statute requires  extensive  additions\t and
\ndeletions.  Not\t only it is no part of the court’s  duty  to
\nundertake  such exercise, but it is beyond its\tjurisdiction
\nto do so. [288F-H, 289A-B]
\n    Re\tHindu Women’s Rights to Property Act, 1937, and\t the
\nHindu Women’s Rights to Property (Amendment) Act, 1938 etc.,
\n[1941]\tFCR 12; Nalinakhya Bysack v. Shyam Sunder  Halder  &
\nOrs.,<\/a> [1953] SCR 533; R.M.D. Chamarbaugwalla v. The Union of
\nIndia,<\/a>\t[1957] SCR 930; Kedar Nath Singh v. State of  Bihar,
\n[1962] Supp. 2 SCR 769; R.L Arora v. State of Uttar  Pradesh
\n& Ors.,<\/a> [1964] 6 SCR 784; Jagdish Pandey v. The\t Chancellor,
\nUniversity  of Bihar & Anr.,<\/a> [1968] I SCR 231; Shri Umed  v.
\nRaj  Singh  & Ors.,<\/a> [1975] I SCR 918;  Mohd.  Yunus  Salim’s
\ncase,  AIR 1974 SC 1218; Sunil Batra etc. v. Delhi  Adminis-
\ntration\t & Ors., [1978] 4 SCC 494; Excel Wear etc. v.  Union
\nof  India  & Ors., [1979] 1 SCR 1009; Minerva Mills  Ltd.  &
\nOrs.  v. Union of India & Ors.,<\/a> [1981] 1 SCR 206;  Union  of
\nIndia  & Anr. etc. v. Tulsiram Patel etc., [1985] 3 SCC\t 398
\nand  Elliott Ashton Welsh, 11 v. United States, 398 US\t333;
\n26 L.ed. 2nd 308, referred to.\n<\/p>\n
155<\/span><\/p>\n
    2.2\t Therefore, the doctrine of reading down  cannot  be
\navailed of for saving the regulation in the instant case. In
\nthe first instance, the regulation is a part of the  service
\nregulations  of the employees made by the Delhi Road  Trans-
\nport  Authority in exercise of the powers conferred by\tsub-
\nsection\t (1)  read  with clause (c) of\tsub-section  (2)  of
\nSection\t 53  of the Delhi Road Transport  Act,\t1950,  whose
\nobject\tis to provide for the establishment and the  regula-
\ntion of Road Transport Authority for the promotion of a\t co-
\nordinated  system of road transport in the State  of  Delhi.
\nThere is nothing either in the object of the service regula-
\ntions  or  in the object of the Act which has a\t bearing  on
\nRegulation  9(b).  If anything the object of the  Act  would
\nrequire framing of such service regulations as would  ensure
\ndedicated and diligent employees to run the undertaking. The
\ndedication  of the employees would pre-suppose\tsecurity  of
\nemployment and not a constant hanging of the Democle’s sword
\nover  their head, and hence would in any case not  bear\t the
\nexistence  of  such regulation. Secondly,  the\tlanguage  of
\nregulation  is so crystal clear that no two  interpretations
\nare possible to be placed on it and hence it is not  permis-
\nsible  to read in it any meaning other than what is  clearly
\nsought\tto  be conveyed by it. Thirdly, the context  of\t the
\nregulation makes it abundantly clear that it is meant to  be
\na naked hire and fire rule and the authority has been vested
\nwith  unguided\tand  arbitrary power to\t dispense  with\t the
\nservices of any category of the employees. Sub-clause (a) of
\nthe  Regulation\t mentions elaborately the  circumstances  in
\nwhich the services of an employee can be terminated  without
\nany  notice  or pay in lieu of such notice.  Sub-clause\t (b)
\nfollows\t closely  on its heel and states in  clear  language
\nthat when the termination is made due to reduction of estab-
\nlishment  or in circumstances other than those mentioned  in
\nsub-clause (a), one month’s notice or pay in lieu thereof is
\nall that is necessary to be given for terminating an employ-
\nee’s  services. The intention of the rule-making  authority,
\ntherefore,  is more than clear. It was to give\tan  absolute
\nfree  hand without any limitations whatsoever  to  terminate
\nthe  services  of  any employee. Both the  language  of\t the
\nregulation as well as the context in which it is cast  leave
\nno scope for reading into it any further provision. [289C-H,
\n290A]
\n    2.3\t Moreover, reading in the rule\tcircumstances  under
\nwhich  alone  the rule can be used, and reading it  down  to
\nread  in it words or expressions or provisions in  order  to
\nsave the legislation would not only distort the intention of
\nthe  rule-making authority but would also require  extensive
\namendment  of a very vague nature to it. The reading in\t the
\nregulation  of\ta  provision that  the\tconcerned  employees
\nshould\tbe  given a hearing with regard to  his\t mis-conduct
\nwill  require that be should first be intimated of the\tmis-
\nconduct of which he is guilty. But
\n156<\/span>
\nthat kind of a situation is taken care of by sub-clause\t (a)
\nof  the said regulation. There is. therefore. no need  of  a
\nseparate prevision for the same. If. on the other hand.\t the
\nservices  of  an employee are to be  terminated\t on  grounds
\nother  than  those mentioned in sub-clause (a),\t then  those
\ngrounds being unknown to the employee, cannot be met by\t him
\neven if he is given a hearing. The Court cannot read in\t the
\nrule all circumstances where it is not possible or necessary
\nto  hold  an enquiry. Such situations are capable  of  being
\nformulated easily and conveniently at least in general terms
\nas is done by the Constitution-makers in the second  proviso
\nto Article 311( 2). The reading of such circumstances in the
\nexisting  regulation would require its\textensive  recasting
\nwhich  is  impermissible for the Court to do.  There  is  no
\nauthority  which  supports  such wide reading  down  of\t any
\nprovision  of the statute or rule\/regulation. Therefore\t the
\ndoctrine  of reading down is singularly inapplicable to\t the
\npresent case. [281B, 290B, 291A-F]\n<\/p>\n
    3.\tClause (b) of Regulation 9 contains the\t much  hated
\nand abused rule of hire and fire reminiscent of the days  of
\nlaissez faire and unrestrained freedom of contract. [274E]
\nPer Ramaswamy.J 1.\n<\/p>\n
    1.1\t The question of security of work is of most  impor-
\ntance. If a person does not have the feeling that he belongs
\nto  an\torganisation engaged in promotion. he will  not\t put
\nforward\t his  best  effort to produce more.  That  sense  of
\nbelonging  arises  only when he feels that he  will  not  be
\nturned\tout  of employment the next day at the whim  of\t the
\nmanagement.  Therefore, as far as possible security of\twork
\nshould be assured the employees so that they may  contribute
\nto the maximisation of production. [300D-E]
\n     Daily  Rated Casual Labour v. Union of India,<\/a> [1988]  1
\nSCR 598 [1988] 1 SCC 122 at 130-131, referred to.
\n    1.2\t A  permanent  employee of  a  statutory  authority,
\ncorporation  or instrumentality under Article 12 has a\tlien
\non the post till he attained superannuation or\tcompulsorily
\nretired or service is duly terminated in accordance with the
\nprocedure established by law. Security of tenure enures\t the
\nbenefit\t of  pension on retirement.  Dismissal,\t removal  or
\ntermination of his\/her service for inefficiency,  corruption
\nor other misconduct is by way of penalty. He\/She has a right
\nto  security  of tenure which is essential  to\tinculcate  a
\nsense  of belonging to the service or organisation  and\t in-
\nvolvement for maximum production or efficient
\n157<\/span>
\nservice. It is also a valuable right which is to be duly put
\nan end to only as per valid law. [300A-G]
\n    Roshan Lal Tandon v. Union of India,<\/a> [1968] 1 SCR 185 at
\n195-196; Calcutta Dock Labour Board v. Jarfar Imam,<\/a> [1965] 3
\nSCR  463 and Sirsi Municipality v. Cecelia Kom Francis\tTal-<\/a>
\nlis, [1973] 3 SCR 348, referred to.\n<\/p>\n
    1.3\t The right to life, a basic human right, assured  by
\nArticle\t 21 of the Constitution comprehends some thing\tmore
\nthan  mere animal existence; it does not only mean  physical
\nexistence,  but includes basic human dignity. The  right  to
\npublic\temployment and its concomitant right  to  livelihood
\nreceive\t their succour and nourishment under the  canopy  of
\nthe protective umbrella of Articles 14, 16(1), 19(1)(g)\t and\n<\/p>\n
21. [296A, 297B]
\nMunn v. Illinois, [1876] 94 US 113 and 154, referred to.
\n    Kharak  Singh v. State of U.P.,<\/a> [1964] 1 SCR  332;\tOlga
\nTellis v. Bombay Municipal Corporation,<\/a> [1985] 2 Suppl.\t SCR
\npage 51 at 79; Menaka Gandhi v. Union of India, [1978] 2 SCR
\n621;  State  of Maharashtra v. Chander Bhan,<\/a>  [1983]  3\t SCR
\n387=AIR 1983 SC 803 and Board of Trustees, Port of Bombay v.
\nDilip Kumar, [1983] 1 SCR 828, referred to.\n<\/p>\n
    1.4\t The  arbitrary, unbridled and naked power  of\twide
\ndiscretion  to\tdismiss\t a permanent  employee\twithout\t any
\nguidelines  or procedure would tend to defeat the  constitu-
\ntional\tpurpose of equality and allied purposes.  Therefore,
\nwhen the Constitution assures dignity of the individual\t and
\nthe right to livelihood, the exercise of power by the execu-
\ntive  should  be combined with adequate safeguards  for\t the
\nrights of the employees against any arbitrary and capricious
\nuse of those powers.\n<\/p>\n
    Workmen of Hindustan Steels Ltd. v. Hindustan Steel Ltd.
\n&  Ors.,<\/a>  [1985] 2 SCR 428 and Francis\tCorallie  v.U.T.  of
\nDelhi, [1981] 2 SCR 516 = AIR 1981 SC 746, referred to.
\n1.5  It\t is well settled constitutional law  that  different
\nArticles the Chapter on Fundamental Rights and the Directive
\nPrinciples in Part IV of the Constitution must be read as an
\nintegral  and  incorporeal whole with  possible\t overlapping
\nwith  the subject-matter of what is to be protected  by\t its
\nvarious provisions, particularly the Fundamental Rights. The
\nfundamental  rights, protected by Part III of the  constitu-
\ntion,  out  of\twhich Articles 14. 19 and 21  are  the\tmost
\nfrequently
\n158<\/span>
\ninvoked to test the validity of executive as well as  legis-
\nlative actions when these actions are subjected to  judicial
\nscrutiny, are necessary means to develop  one’s own  person-
\nality  and  to carve out one’s own life in  the\t manner\t one
\nlikes  best  subject to reasonable restrictions\t imposed  in
\nthe  paramount interest of the society and to a\t just.\tfair
\nand  reasonable\t procedure.  The effect\t of  restriction  or
\ndeprivation and not of the form adopted to deprive the right
\nis the conclusive test. Thus, the right to a public  employ-
\nment  is  a constitutional right under\tArticle\t 16(1).\t All
\nmatters relating to employment include the right to continue
\nin  service till the employee reaches superannuation or\t his
\nservice is duly terminated in accordance with just, fair and
\nreasonable procedure prescribed under the provisions of\t the
\nConstitution or the Rules made under proviso to Article\t 309
\nof the Constitution or the statutory provision or the Rules.
\nregulations  or instructions having statutory  flavour\tmade
\nthereunder. But the relevant provisions must be\t conformable
\nto the rights guaranteed in Parts III & IV of the  Constitu-
\ntion. Article 21 guarantees the right to live which includes
\nright  to livelihood. to many. assured tenure of service  is
\nthe source. [311G; 312G-H, 313A-B]
\n    R.C. Cooper v. Union of India,<\/a> [1970] 3 SCR 530; Minerva
\nMills Ltd. v. Union of India,<\/a> [1981] 1 SCR 2116 and Union of
\nIndia  & Ant. v. Tulsiram Patel &<\/a> 0rs.. [1985] Suppl. 2\t SCR
\n131 at 233 referred to.\n<\/p>\n
    1.6\t Article  14  is the general  principle\t while\tArt.
\n311(2) is a special provision applicable to all civil  serv-
\nices under the State. Article 311(2) embodies the principles
\nof  natural  justice but proviso to clause (2) of  Art.\t 311
\nexcludes  the  operation of principles\tof  natural  justice
\nengrafted  in Art. 311(2) as an exception in the given\tcir-
\ncumstances  enumerated\tin these clauses of the\t proviso  to
\nArt. 311(2) of the Constitution. Article 14 read with  Arti-
\ncles  16(1) and 311 are to be harmoniously interpreted\tthat
\nthe  proviso to Art. 311(2) excludes the application of\t the
\nprinciples  of\tnatural\t justice as an\texception;  and\t the
\napplicability of Article 311(2) must, therefore, be  circum-
\nscribed to the civil services and to be construed according-
\nly. In respect of all other employees covered by Article  12
\nof the Constitution the dynamic role of Article 14 and other
\nrelevant Articles like 21 must be allowed to have full\tplay
\nwithout\t any  inhibition. unless the statutory\trules  them-
\nselves, consistent with the mandate of Articles 14.16.19 and
\n21 provide, expressly, such an exception. [317F-H, 315A]
\n    Union  of India & Ant. v. Tulsiram Patel & Ors.,<\/a>  [1985]
\nSuppl.\t2 SCR 131 at 233; A.K. Kraipak & Ors. etc. v.  Union
\nof India & Ors., [1970] 1 SCR 457 and Union of India v.\t Col
\nJ.N. Sinha & Ors.,<\/a> [1971] 1 SCR 791, referred to.\n<\/p>\n
159<\/span><\/p>\n
    1.7\t Article  19(1)(g) empowers every citizen  right  to
\navocation  or  profession etc., which includes right  to  be
\ncontinued in employment under the State unless the tenure is
\nvalidly terminated and consistent with the scheme  enshrined
\nin  the\t fundamental rights of\tthe  Constitution.  Whenever
\nthere is arbitrariness in State action–whether it be of the
\nLegislature  or\t of the Executive or of an  authority  under
\nArticle 12. Articles 14 and 21 spring into action and strike
\ndown such an action. The concept of reasonableness and\tnon-
\narbitrariness  pervades the entire  constitutional  spectrum
\nand  is a golden thread which runs through the whole  fabric
\nof the Constitution. [315B-D]
\n    1.8 Thus, Article 14 read with 16(1) accords right to an
\nequality or an equal treatment consistent with principles of
\nnatural justice. Any law made or action taken by the employ-
\ner, corporate statutory or instrumentality under Article  12
\nmust act fairly and reasonably. Right. to fair treatment  is
\nan essential inbuilt of natural justice. Exercise of  unbri-
\ndled  and uncanalised discretionary power impinges upon\t the
\nright  of  the citizen; vesting of discretion  is  no  wrong
\nprovided it is exercised purposively, judiciously and  with-
\nout prejudice. Wider the discretion, the greater the chances
\nof abuse. Absolute discretion is destructive of freedom than
\nof man’s inventions. Absolute discretion marks the beginning
\nof the end of the liberty. The conferment of absolute  power
\nto dismiss a permanent employee is antithesis to justness or
\nfair treatment. The exercise of discretionary power wide  of
\nmark  would bread arbitrary, unreasonable or unfair  actions
\nand would not be consistent with reason and justice.  [320B-
\nD]
\n    1.9 The right to public employment which includes  right
\nto continued public employment till the employee is superan-
\nnuated\tas per rules or compulsorily retired or duly  termi-
\nnated in accordance with the procedure established by law is
\nan integral part of right to livelihood which in turn is  an
\nintegral  part\tof right to life assured by Art. 21  of\t the
\nConstitution.  Any  procedure prescribed to deprive  such  a
\nright  to livelihood or continued employment must  be  just,
\nfair and reasonable procedure and conformable to the mandate
\nof  Articles  14 and 21. In other words, an  employee  in  a
\npublic employment also must not be arbitrarily, unjustly  or
\nunreasonably deprived of his\/her livelihood which is ensured
\nin continued employment till it is terminated in  accordance
\nwith just, fair and reasonable procedure. Otherwise any\t law
\nor rule in violation thereof is void. [320E-F]
\n    A.K.  Kraipak  &  Ors. etc. v. Union of  India  &  Ors.,
\n[1970]\t1  SCR 457; Union of India v. Col.  J.N.  Sinha\t and
\nAnr.,<\/a> [1971] 1 SCR 791;\n<\/p>\n
160<\/span><\/p>\n
Fertilizer  Corporation Kamgar Union (Regd.), Sindri &\tOrs.
\nv.  Union  of India & Ors.,<\/a> [1981] 2 SCR 52 at\t60-61;\tS.S.
\nMuley  v. J.R.D. Tata, [1979] 2 SLR 438\t (Bombay);  Superin-
\ntendent\t of Post Office v. K. Vasayya, [1984] 3 Andhra\tPra-
\ndesh law Journal 9; West Bengal Electricity Board & Ors.  v.
\nD.B. Ghosh & Orb’.,<\/a> [1985] 2 SCR 1014; Workmen of  Hindustan
\nSteel  Ltd. & Anr. v. Hindustan Steel Ltd. & Ors.,<\/a> [1985]  2
\nSCR  428; O.P. Bhandari v. Indian Tourism Development  Corp.
\nLtd.  & Ors.,<\/a> [1986] 4 SCC 337; A.P.S.R.T. Corp.  v.  Labour
\nCourt, AIR<\/a> 1980 A.P. 132; R.M.D. Chamarbaugwalla v. State of
\nPunjab, [1957] SCR 930; Kanhialal v. District Judge &  Ors.,<\/a>
\n[1983] 3 SCC 32; M.K. Agarwal v. Gurgaon Gramin Bank & Ors.,<\/a>
\n[1987] Suppl. SCC 643; All Saints High School v.  Government
\nof  A.P.,  [1980]  2 SCR 924 & 938 e to\t f;  Frank  Anthoney
\nPublic School v. Union of India,<\/a> [1987] 1 SCR 238 & 269 b to
\ne;  Christian  Medical College Hospital Employees’  Union  &
\nAnr.  v.  Christian Medical College  Veilore  Association  &
\nOrs.,<\/a>  [1988] 1 SCR 546 & 562; Kameshwar Prasad v. State  of
\nBihar, [1962] Suppl. 3 SCR 369 and O.K. Ghosh v. EZX Joseph,<\/a>
\n[1963] Supp. 1 SCR 789, referred to.\n<\/p>\n
United\tStates\tv. Samuel D. singleton, [1981]\t109  US.  3,
\nreferred
\n    1.10  Undoubtedly, efficiency of the administration\t and
\nthe  discipline\t among the employees is very  vital  to\t the
\nsuccessful functioning of an institution or maximum  produc-
\ntion of goods or proper maintenance of the services.  Disci-
\npline in that regard amongst the employees is its  essential
\nfacet  and  bas\t to be maintained. The\tsociety\t is  vitally
\ninterested in the due discharge of the duties by the govern-
\nment employees or employees of corporate bodies or statutory
\nauthorities  or instrumentalities under Art. 12 of the\tCon-
\nstitution.  The\t government  or\t corporate  employees\tare,
\nafter-all, paid from the public exchequer to which  everyone
\ncontributes  either by way of direct or indirect taxes.\t The
\nemployees  are\tcharged\t with public duty  and\tthey  should
\nperform their public duties with deep sense of responsibili-
\nty.  The collective responsibility of all the officers\tfrom
\ntop most to the lowest maximises the efficient public admin-
\nistration. They must, therefore, be held to have  individual
\nas  well as collective responsibility in discharge of  their
\nduties\tfaithfully honestly with full dedication and  utmost
\ndevotion  to  duty. Equally the employees must also  have  a
\nfeeling that they have security of tenure. They should\talso
\nhave  an  involvement on their part in the  organisation  or
\ninstitution, corporation, etc. They need assurance of  serv-
\nice and protection. The public interest and the public\tgood
\ndemands\t that  those who discharge  their  duties  honestly,
\nefficiently and
\n161<\/span>
\nwith  a\t sense\tof devotion and dedication  to\tduty  should
\nreceive\t adequate protection and security of tenure.  There-
\nfore,  before depriving an employee of the means of  liveli-
\nhood to himself and his dependents, i.e. job, the  procedure
\nprescribed  for\t such  deprivation must be  just,  fair\t and
\nreasonable  under  Arts. 21 and 14 and when  infringes\tArt.
\n19(1)(g) must be subject to imposing reasonable restrictions
\nunder Art. 19(5). [320G-H, 321A-D, 322D]
\n    1.11  Conferment of power on a high rank officer is\t not
\nalways an assurance, in particular, when the moral standards
\nare generally degenerated, that the power would be exercised
\nobjectively, reasonably, conscientiously, fairly and  justly
\nwithout inbuilt protection to an employee. Even officers who
\ndo  their duty honestly and conscientiously are\t subject  to
\ngreat  pressures and pulls. Therefore, the competing  claims
\nof the “public interest” as against “individual interest” of
\nthe employees are to be harmoniously blended so as to  serve
\nthe societal need consistent with the constitutional scheme.
\n[322D-E]
\n    1.12 Regulation 9(b) of the Delhi Road Transport (Condi-
\ntions  of  Appointment and Service)  Regulations,  1952,  is
\narbitrary,  unjust, unfair and unreasonable offending  Arti-
\ncles  14, 16(1), 19(1)(g) and 21 of the Constitution. It  is
\nalso opposite to the public policy and thereby is void under
\nSection 23 of the Indian Contract Act. [330G]
\n    1.13  Under ordinary law of master and servant,  whether
\nthe contract of service is for a fixed period or not, if  it
\ncontains  a provision for termination of service by  notice,
\nin  terms thereof, it can be so determined and if  the\tcon-
\ntract finds no provision to give notice and the contract  of
\nservice\t is not for a fixed period, law implies giving of  a
\nreasonable  notice. Where no notice or a  reasonable  notice
\nwas issued. before terminating the contract. the termination
\nof  the\t contract of service is wrongful and  the  aggrieved
\nemployee  is entitled at law to sue for damages. It  is\t not
\ndisputed  that\tthe Delhi Road Transport  Corporation  is  a
\nstatutory Corporation under the Delhi Road Transport Act and
\nthe Regulations are statutory and its employees are entitled
\nto  the\t fundamental  rights enshrined in Part\t111  of\t the
\nConstitution. The Corporation or an instrumentality or other
\nauthority  under  Article 12 is not free, like\tan  ordinary
\nmaster (a private employer) to terminate the services of its
\nemployees at its whim or caprices or vagary. It is bound  by
\nthe  Act and the Regulation and paramount law of  the  land,
\nthe Constitution. [292G-H; 293A-B]
\n    1.14 Any law, much less the provisions of Contract\tAct,
\nwhich  are inconsistent with the fundamental rights  guaran-
\nteed in Part III of
\n162<\/span>
\nthe Constitution, are void by operation of Article 13 of the
\nConstitution.  The  law of contract, like the  legal  system
\nitself, involves a balance between competing sets of values.
\nFreedom\t of  contract  emphasises the  need  for  stability.
\ncertainty and predictability. But, important as values\tare.
\nthey  are  not absolute, and there comes a point  when\tthey
\nface a serious challenge. ‘This Court, as a court of consti-
\ntutional conscience enjoined and is jealously to project and
\nuphold\tnew  values in establishing the\t egalitarian  social
\norder.\tAs a court of constitutional functionary  exercising
\nequity\tjurisdiction,  this Court would relieve\t the  weaker
\nparties\t  from\tunconstitutional  contractual\tobligations,
\nunjust,\t unfair,  oppressive  and  unconscionable  rules  or
\nconditions  when  the citizen is really unable\tto  meet  on
\nequal terms with the State. It is to find whether the  citi-
\nzen, when entered into contracts of service, was in distress
\nneed  or compelling circumstances to enter into contract  on
\ndotted\tlines  or whether the citizen was in a\tposition  of
\neither\tto “take it or leave it” and if it finds to  be\t so,
\nthis  Court would not shirk to avoid the contract by  appro-
\npriate declaration. [302G, 303B, 304H, 305A-B]
\n    Central Inland Water Transport Company Limited v. Brojo-
\nnath Ganguly, [1986] 3 SCC 156=AIR 1986 SC 1571, affirmed.
\n    Ramdas Vithaldas Durbar v. S. Amarchand & 60., 43 Indian
\nAppeals.  164 and V. Raghunadha Rao v. State of Andhra\tPra-
\ndesh, [1988] 2 A.L.T. 461, referred to.\n<\/p>\n
    Anson’s Law of Contract, p. 6 and 7 and Professor  Guido
\nCalabresi  of  Yale  University\t Law  School  “Refractivity,
\nParamount  power and Contractual Changes”, 1961-62  71\tYale
\nLaw Journal, P- 1191, referred to.\n<\/p>\n
    2.1\t The golden rule of statutory construction  is\tthat
\nthe  words  and phrases or sentences should  be\t interpreted
\naccording  to the intent of the legislature that passed\t the
\nAct.  All  the provisions should be read  together.  If\t the
\nwords of the statutes are in themselves precise and unambig-
\nuous,  the words, or phrases or sentences  themselves  alone
\ndo,  then  no more can be necessary than  to  expound  those
\nwords or phrases or sentences in their natural and  ordinary
\nsense.\tBut if any doubt arises from the terms\temployed  by
\nthe  legislature, it is always safe means of collecting\t the
\nintention, to call in aid the ground and cause of making the
\nstatute,  and have recourse to the preamble, which is a\t key
\nto  open  the  minds of the makers of the  statute  and\t the
\nmischiefs  which the Act intends to redress. In\t determining
\nthe  meaning of statute the first question to ask always  is
\nwhat is the natural or ordinary meaning of that
\n163<\/span>
\nword or phrase in its context. It is only when that  meaning
\nleads to some result which cannot reasonably be supposed  to
\nhave  been the intent of the legislature, then it is  proper
\nto look for some other possible meaning and the court cannot
\ngo further. [323D-G]
\n    2.2\t The  Doctrine\tof Reading Down\t is,  therefore,  an
\ninternal aid to construe the word or phrase in a statute  to
\ngive  reasonable  meaning,  but not to\tdetract,  disort  or
\nemasculate  the language so as to give the supposed  purpose
\nto  avoid unconstitutionality. Thus, the object\t of  reading
\ndown  is  to keep the operation of the\tstatute\t within\t the
\npurpose of the Act and constitutionally valid. [324E, 325B]
\n    2.3 It cannot be accepted that the Courts, in the  proc-
\ness of interpretation of the Statute, would not make law but
\nleave it to the legislature for necessary amendments. In  an
\nappropriate  case, Judges would articulate the\tinarticulate
\nmajor premise and would give life and force to a Statute  by
\nreading\t harmoniously  all the provisions  ironing  out\t the
\ncreezes.  The object is to elongate the purpose of the\tAct.
\n[323B]
\n    2.4\t The Courts, though, have no power to amend the\t law
\nby  process of interpretation, but do have power to mend  it
\nso as to be in conformity with the intendment of the  legis-
\nlature. Doctrine of reading down is one of the principles of
\ninterpretation\tof  statute in that process.  But  when\t the
\noffending language used by the legislature is clear, precise
\nand  unambiguous, violating the relevant provisions  in\t the
\nconstitution, resort cannot be had to the doctrine of  read-
\ning  down  to blow life into the void law to  save  it\tfrom
\nunconstitutionality or to confer jurisdiction on the  legis-
\nlature.\t Similarly it cannot be taken aid of  to  emasculate
\nthe  precise,  explicit, clear and unambiguous\tlanguage  to
\nconfer\tarbitrary,  unbridled and uncanalised  power  on  an
\nemployer  which is a negation to just, fair  and  reasonable
\nprocedure envisaged under Articles 14 and 21 of the  Consti-
\ntution\tand  to direct the authorities\tto  record  reasons,
\nunknown or unintended procedure. [326H, 327A-B]
\n    Elliott Ashton Walsh, H v. United States, 398 U.S.\t333;
\nNalinakhya Bysack v. Shyam Sunder Haldar & Ors.,<\/a> [1953]\t SCR
\n533  at\t 544-45; United States v. Wunderlick, 342  U.S.\t 93;
\nS.C. Jaisinghani v. Union of India, [1967] 2 SCR 703; In  re
\nHindu  Women’s Right to Property Act, [1941] FCR,  12;\tK.N.
\nSingh v. State of Bihar, [1962] Suppl. 2 SCR 769; R.L. Arora
\nv. State of U.P.,<\/a> [1964] 6 SCR 784; Jagdish Pandev v.  Chan-
\ncellor of the Bihar, [1969] 1 SCR 231; Amritsar Municipality
\nv.  State of Punjab, [1969] 3 SCR 447;Sunil Batra  v.  Delhi
\nAdmn.,<\/a>\t[1978] 4 SCC 494; N.C. Dalwadi v. State of  Gujarat,<\/a>
\n[1987] 3
\n164<\/span>
\nSCC  611;  Charanlal Sahu v. Union of India,  [1989]  Suppl.
\nScale  1  at p. 61; Delhi Transport  Undertaking  v.  Balbir
\nSaran  Goel,<\/a>  [1970]  3 SCR 747; Air  India  Corporation  v.
\nRebellow,<\/a>  [1972]  3 SCR 606 and  Municipal  Corporation  of
\nGreater\t Bombay\t v. P.S. Malvankar,<\/a> [1978] 3 SCR  1000,\t re-
\nferred to.\n<\/p>\n
    Federal Steam Navigation Co. v. Department of Trade\t and
\nIndustry,  [1974]  2 All E.R. 97 at p. 100 and\tSaints\tHigh
\nSchool,\t Hyderabad v. Govt. of A. P., [1980] 2 SCR 924,\t re-
\nferred to.\n<\/p>\n
Craies Statute Law, 7th Ed. Ch. V, P. 64.\n<\/p>\n
    2.5\t The language of Regulation 9(b) is not\t capable  of
\ntwo interpretations. This power is in addition to the normal
\npower in Regulation 15 to conduct an enquiry into misconduct
\nafter giving reasonable opportunity. Thereby the legislative
\nintention is manifest that it intended to confer such draco-
\nnian  power  couched in language of width which\t hangs\tlike
\nDamocles  sword on the neck of the employee,  keeping  every
\nemployee  on tenter-hook under constant pressure  of  uncer-
\ntainty,\t precarious tenure at all times right from the\tdate
\nof  appointment\t till  date of\tsuperannuation.\t It  equally
\nenables the employer to pick and choose an employee at\twhim
\nor  vagary to terminate the service arbitrarily\t and  capri-
\nciously.  Regulation  9(b), thereby  deliberately  conferred
\nwide power of termination of services of the employee  with-
\nout following the principles of audi alteram partem or\teven
\nmodicum\t of procedure of representation\t before\t terminating
\nthe services of permanent employee. [327E-G]
\n    2.6 No doubt, the power to take appropriate and  expedi-
\ntious  action to meet the exigencies of weeding out  ineffi-
\ncient, corrupt, indolent officers or employees from  service
\nshould be provided and preserved to the competent  authority
\nbut  any  action  taken without any  modicum  of  reasonable
\nprocedure  and\tprior opportunity always  generates  an\t un-
\nquenchable  feeling that unfair treatment was meted  out  to
\nthe aggrieved employee. To prevent miscarriage of justice or
\nto  arrest a nursing grievance that arbitrary  whimsical  or
\ncapricious  action was taken behind the back of an  employee
\nwithout\t opportunity, the law must provide a fair, just\t and
\nreasonable procedure as is exigible in a given\tcircumstance
\nas adumbrated in proviso to Art. 311(2) of the Constitution.
\nIf an individual action is taken as per the procedure on its
\nown  facts  its legality may be tested. But it would  be  no
\njustification  to confer power with wide discretion  on\t any
\nauthority  without  any procedure which would not  meet\t the
\ntest of justness, fairness and reasonable-\n<\/p>\n
165<\/span><\/p>\n
ness  envisaged under Arts. 14 and 21 of  the  Constitution.
\nTherefore, conferment of power with wide discretion  without
\nany guidelines, without any just, fair or reasonable  proce-
\ndure  is  constitutionally  anathema  to  Arts.\t 14,  16(1),
\n19(1)(g)  and  21 of the Constitution. Doctrine\t of  reading
\ndown cannot be extended to such a situation. [328A-C,  329B-
\nC]
\n    2.7\t In view of the march of law, made by Article 14  it
\nis too late in the day to contend that the competent author-
\nity  would be vested with wide discretionary  power  without
\nany  proper  guidelines or the procedure. When it  is  found
\nthat the legislative intention is unmistakably clear,  unam-
\nbiguous and specific, the preamble, the other rules and\t the
\ncircumstances could not be taken aid of in reading down\t the
\nprovisions of the rules or the regulations of the  constitu-
\ntional scheme. [330F-G]
\n    3.1\t The  phrases  “public policy”,\t opposed  to  public
\npolicy,\t or  “contrary to public policy”  are  incapable  of
\nprecise definition. It is valued to meet the public good  or
\nthe  public interest. What is public good or in\t the  public
\ninterest or what would be injurious or harmful to the public
\ngood or the public interest vary from time to time with\t the
\nchange\tof the circumstances. Therefore, in the\t absence  of
\nspecific head of public policy which covers a case, then the
\ncourt  must  in consonance with public\t conscience  and  in
\nkeeping\t with  public good and public  interest\t invent\t new
\npublic\tpolicy and declare such practice or rules  that\t are
\nderogatory  to\tthe  constitution to be\t opposed  to  public
\npolicy. The rules which stem from the public policy must  of
\nnecessity be laid to further the progress of the society, in
\nparticular when social change is to bring about an egalitar-
\nian  social  order through rule of law. In deciding  a\tcase
\nwhich  may not be covered by authority, courts\thave  before
\nthem  the  beacon light of the trinity of  the\tConstitution
\nviz.,  the  preamble, Part III and Part IV and the  play  of
\nlegal  light  and  shade must lead on the  path\t of  justice
\nsocial, economic and political. Lacking precedent, the court
\ncan  always  be guided by that light and the  guidance\tthus
\nshed  by the trinity of our Constitution.  [308C-D,  309G-H,
\n310A]
\n    3.2\t Since\tConstitutions are the superior\tlaw  of\t the
\nland,  and  because  one of their  outstanding\tfeatures  is
\nflexibility  and capacity to meet changing conditions,\tcon-
\nstitutional  policy provides a valuable aid  in\t determining
\nthe legitimate boundaries of statutory meaning. Thus  public
\npolicy having its inception in Constitutions may  accomplish
\neither a restricted or extended interpretation of the liter-
\nal expression of a statute. A statute is always presumed  to
\nbe  constitutional  and where  necessary,  a  constitutional
\nmeaning\t will  be inferred to preserve\tvalidity.  Likewise,
\nwhere a statute tends to extend or preserve a constitutional
\n166<\/span>
\nprinciple, reference to analogous constitutional  provisions
\nmay be of great value in shaping the statute to accord\twith
\nthe  statutory aim or objective. Therefore, when the  provi-
\nsions  of  an Act or Regulations or Rules  are\tassailed  as
\narbitrary,  unjust, unreasonable,  unconstitutional,  public
\nlaw  element  makes it incumbent to  consider  the  validity
\nthereof\t on  the  anvil of inter play of  Arts.\t 14,  16(1),
\n19(1)(g)  and 21 and of the inevitable effect of the  provi-
\nsion  challenged  on  the rights of a citizen  and  to\tfind
\nwhether they are constitutionally valid. [310C-D, 311E]\n<\/p>\n
    4. The absence of arbitrary power is the first essential
\nof  the\t rule  of law upon which  our  whole  constitutional
\nsystem\tis based. In a system governed by rule of law,\tdis-
\ncretion, when conferred upon executive authorities, must  be
\nconfined  within defined limits. The rule of law  from\tthis
\npoint  of  view means that decisions should be made  by\t the
\napplication  of known principles and rules and, in  general,
\nsuch decisions should be predictable and the citizen  should
\nknow where he is. If a decision is taken without any princi-
\nple  or\t without  any rule it is unpredictable\tand  such  a
\ndecision is the antithesis of a decision taken in accordance
\nwith the rule of law. [328D-E]\n<\/p>\n
    5. No doubt, it is open to the authorities to  terminate
\nthe  services  of a temporary employee\twithout\t holding  an
\nenquiry. But in view of the march of law made, viz., that it
\nis not the form of the action but the substance of the order
\nwhich is to be looked into, it is open to the Court to\tlift
\nthe  veil and pierce the action challenged to  find  whether
\nthe said action is the foundation to impose punishment or is
\nonly  a motive. The play of fair play is to  secure  justice
\nprocedural  as\twell as substantive. The  substance  of\t the
\norder, the effect thereof is to be looked into. [330C-D]
\nShamsher  Singh\t v. State of Punjab, [1975] 4 SCR  814,\t re-
\nferred to.\n<\/p>\n
    It\tis  for concerned authorities  to  make\t appropriate
\nrules  or  regulations and to take appropriate\taction\teven
\nwithout\t resorting  to elaborate enquiry  needed  consistent
\nwith the constitutional scheme. [331A]
\n    Workmen of Hindustan Steel Ltd. v. Hindustan Steel\tLtd.
\n& Ors.,<\/a> [1985] 2 SCR 428, referred to.\n<\/p>\n
Ram  Chander v. Union of India,<\/a> [1986] 2 SCR  980,  referred
\nto.\n<\/p>\n
    6. The ratio in Brojonath’s case was correctly laid down
\nand requires no reconsideration. [331D]
\n167<\/span>
\n    Central Inland Water Transport Company Limited v. Brojo-
\nnath Ganguly, [1986] 3 SCC 156-AIR 1986 SC 1517, affirmed.
\nPer Mukharji, CJ., (Contra)\n<\/p>\n
    1.\tThe constitutionality of the conferment of power  to
\nterminate  services of a permanent employee without  holding
\nan  enquiry is sustained by reading that the power  must  be
\nexercised  on reasons relevant for the efficient running  of
\nthe  services or performing of the job by the  societies  or
\nthe  bodies.  It  should be done  objectively,\tthe  reasons
\nshould be recorded, and the basis that it is not feasible or
\npossible  reasonably to hold any enquiry without  disclosing
\nthe evidence which in the circumstances of the case would be
\nhampering the running of the institution. The reasons though
\nrecorded,  need\t not  be communicated, it is  only  for\t the
\npurpose\t of  running  of the institution.  There  should  be
\nfactors which hamper running of the institution without\t the
\ntermination  of the employment of the employee concerned  at
\nthe  particular\t time,\teither because he is  a\t surplus  or
\ninefficient, disobedient and dangerous. [235C-E]
\n    2.1 The philosophy of the Indian Constitution, as it has
\nevolved,  from\tprecedent to precedent,\t has  broadened\t the
\nhorizons  of the right of the employees and they  have\tbeen
\nassured\t security of tenures and ensured protection  against
\narbitrariness and discrimination in discharge or termination
\nof  his employment. This is the basic concept of the  evolu-
\ntion from the different angles of law of master and  servant
\nor  in the evolution of employer and employee  relationship.
\nIt is true that the law has traveled in different  channels,
\ngovernment  servants or servants or employees having  status
\nhave to be differentiated from those whose relationships are
\nguided\tby contractual obligations. However, the  basic\t and
\nfundamental question to be judged is, in what manner and  to
\nwhat  extent, the employees of either of semi-Government  or
\nstatutory corporations or public undertakings who enjoy\t the
\nrights, privileges, limitations and inhibitions of  institu-
\ntions who come within the ambit of Article 12 of the Consti-
\ntution could be affected in their security of tenure by\t the
\nemployers consistent with the rights evolved over the  years
\nand rights emanating from the philosophy of the Constitution
\nas at present understood and accepted. [229D-G]
\n    2.2 Efficiency of the administration of these  undertak-
\nings  is very vital and relevant  consideration.  Production
\nmust continue, services must be maintained and run. Efficacy
\nof  the services can be manned only by the  disciplined\t em-
\nployees or workers. Discipline. decency and
\n168<\/span>
\norder  will  have to be maintained.  Employees\tshould\thave
\nsense of participation and involvement and necessarily sense
\nof security in semipermanent or quasi-permanent or permanent
\nemployment.  There must be scope for encouragement for\tgood
\nwork.  In  what manner and in what measure, this  should  be
\nplanned and ensured within the framework of the Constitution
\nand,  power  mingled with obligations, and  duties  enjoined
\nwith rights, are matters of constitutional adjustment at any
\nparticular evolved stage of the philosophy of our  Constitu-
\ntion. [230A-C]
\n    2.3\t Arbitrary, whimsical or discriminatory\t action\t can
\nflow  or follow in some cases by the preponderance of  these
\npowers\tto terminate. The tact that the power  is  entrusted
\nwith  a high ranking authority or body is not always a\tsafe
\nor  sound  insurance against misuse. At least, it  does\t not
\nalways ensure against erosion of credibility in the exercise
\nof  the power in particular contingency. Yet discipline\t has
\nto  be maintained, efficiency of the institution has  to  be
\nensured. It has to be recognised that quick actions are very
\noften  necessary  in  running of an  institution  or  public
\nservice\t or  public utility and public concern.\t It  is\t not
\nalways possible to have enquiry because disclosure is diffi-
\ncult; evidence is hesitant and difficult, often\t impossible.
\nIn  those  circumstances, the approach to  the\tlocation  of
\npower,\tpossession  and exercise of which is  essential\t for
\nefficient running of the industries or services, has to be a
\nmatter\tboth of balancing and adjustment, on which  one\t can
\nwager the salivation of rights and liberties of the  employ-
\nees concerned and the future of the industries or the  serv-
\nices involved. [330D-F]
\n    2.4\t The power to terminate the employment of  permanent
\nemployment must be there. Efficiency and expediency and\t the
\nnecessity of running an industry or service make it  impera-
\ntive  to have these powers. Power must, therefore,  be\twith
\nauthorities to take decision quickly, objectively and  inde-
\npendently. Power must be assumed with certain conditions  of
\nduty.  The  preamble, the policy, purpose  of  the  enacting
\nprovision delimit the occasions or the contingencies for the
\nneed  for the exercise of the power and these  should  limit
\nthe  occasions\tof exercise of such powers.  The  manner  in
\nwhich  such exercise of power should be made  should  ensure
\nfairness,  avoid  arbitrariness\t and mala  fide\t and  create
\ncredibility  in the decisions arrived at or by\texercise  of
\nthe  power. All these are essential to ensure that power  is
\nfairly\texercised and there is fair play in action.  Reasons
\ngood and sound, must control the exercise of power. [230G-H,
\n231A]
\nThus, for the running of the industry or the service,  effi-
\nciently,
\n169<\/span>
\nquickly\t and  in a better manner or to avoid  dead-locks  or
\ninefficiency  or friction, the vesting of the power in\tcir-
\ncumstances  must be such that it will evoke credibility\t and
\nconfidence. Notice of hearing and opportunity in the form of
\nan  enquiry may or may not be given, yet  arbitrariness\t and
\ndiscrimination and acting whimsically must be avoided. These
\npowers\tmust, therefore, be so read that the powers  can  be
\nexercised on reasons, which should be recorded, though\tneed
\nnot  always be communicated, and must be by authorities\t who
\nare  high  ranking or senior enough and\t competent  and\t are
\nexpected  to act fairly, objectively and independently.\t The
\noccasion for the use of power must be clearly  circumscribed
\nin  the above limits. These must also circumscribe that\t the
\nneed for exercise of those powers without holding a detailed
\nor prolonged enquiry is there. [231E, F-G]
\n    Workmen  of\t Hindustan Steel Ltd. &\t Anr.  v.  Hindustan
\nSteel  Ltd.  &\tOrs.,<\/a> [1985] 2 SCR 428;\t West  Bengal  State
\nElectricity  Board and Others v. Desh Bandhu Ghosh and\tOth-<\/a>
\ners, [1985] 3 SCC 116; Moti Ram Deka v. North East  Frontier
\nRailway, [1985] 5 SCR 683; S.S. Muley v. J.R.D. Tata, [1979]
\n2  SLR\t438; Manohar P. Kharkhar v. Raghuraj, [1981]  2\t LLJ
\n459; Central Inland Water Transport Corporation Limited\t and
\nAnr.  v.  Brojo\t Nath Ganguly and Anr.,<\/a> [1985]\t3  SCC\t156;
\nSukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi,<\/a>  [1975]
\n3 SCR 619; Union of India & Anr. v. Tulsi Ram PateI,<\/a>  [1985]
\nSuppl.\t2  SCR\t131 at p. 166; Tata Oil Mills  Co.  Ltd.  v.
\nWorkmen\t & Anr.,<\/a> [1964] 2 SCR 125 at 130; L. Michael &\tAnr.
\nv.  M\/s Johnston Pumps India Ltd.,<\/a> [1975] 3 SCR 489 at\t498;
\nDelhi  Transport  Corporation Undertaking  v.  Balbir  Saran
\nGoel,<\/a> [1970] 3 SCR 757 at 764; Air India Corporation, Bombay
\nv. V.A. Rebellow & Anr.,<\/a> [1972] 3 SCR 606; Municipal  Corpo-
\nration of Greater Bombay v. P.S. Malvenkar & Ors.,<\/a> [1978]  3
\nSCR 1000 at page 1006; Roshan Lal Tandon v. Union of  India,<\/a>
\n[1968] 1 SCR 185 at 195 D-E; Champak Lal Chiman Lal Shah  v.
\nThe  Union  of\tIndia,<\/a> [1964] 5 SCR 190 at  204;  Ram  Gopal
\nChaturvedi v. State of M.P.,<\/a> [1970] 1 SCR 472 at 475;  Gheru
\nLal Parekh v. Mahadeodas Maiva & Others, [1959] Supp. 2\t SCR
\n406  at 440; O.P. Bhandari v. I.T.D.C. & Ors., [1986] 4\t SCC
\n337;  The Hindu Women’s Rights to Property Act,\t [1941]\t FCR
\n12;  Fertilizer Corporation Kamgar Union (Regd.) Sindri\t and
\nOthers v. Union of India and Others,<\/a> [1981] 2 SCR at  60-61;
\nAjay  Hasia  etc. v. Khalid Mujib Sehravardi  &\t Ors.  etc.,
\n[1981] 2 SCR 79 at 100-102; A.V. Nachane & Anr. v. Union  of
\nIndia  & Anr.,<\/a> [1982] 2 SCR 246; India Tobacco Co.  Ltd.  v.
\nThe Commercial Tax Officer, Bhavanipore & Ors.,<\/a> [1975] 2 SCR
\n619 at 657; A.L. Kalra v. The Project and Equipment Corpora-<\/a>
\ntion  of India Ltd., [1984] 3 SCR 646 at 664; Bandhua  Mukti
\nMorcha v. Union of India & Ors.,<\/a> [1984] 2
\n170<\/span>
\nSCR  79 at 101; Hindustan Antibiotics Ltd. v. The Workmen  &
\nOrs.,<\/a>  [1967]  1 SCR 652 at 669; The Collector\tof  Customs,
\nMadras v. Nathella Sampathu Chetty,<\/a> [1962] 3 SCR 786 at 825;
\nCommissioner of Sales Tax, Madhya Pradesh v. Radhakrishan  &
\nOrs.,<\/a> (supra); Gurdev Singh Sidhu v. State of Punjab & Anr.,<\/a>
\n[1964] 7 SCR 587 at 592-593; U.P. State Electricity Board v.
\nHari  Shankar Jain,<\/a> [1979] 1 SCR 355\/362-3; A.R. Antulay  v.
\nR.S.  Nayak and Anr.,<\/a> [1988] 2 SCC 602; S.G. Jaisinghani  v.
\nUnion  of India and Ors., [1967] 2 SCR 703 at p. 718-19\t and
\nKesavananda  Bharati v. State of Kerala,<\/a> [1973] Supp. 1\t SCR
\n1, referred to.\n<\/p>\n
    A.\tSchroeder  Music Publishing Co.\t Ltd.  v.  Macaulay,
\n(formerly Instone), [1974] 1 W.L.R. 1308, referred to.\n<\/p>\n
      Chitty  on Contract, 46th Edition Vol. II, p.  808  or
\n25th Edition Vol. II p. 712 paragraph and Halsbury’s Law  of
\nEngland, 4th Edition Vol. No. 16 paras 607 and 608, referred
\nto.\n<\/p>\n
    3.1 Courts have been tempted to read down in the path of
\njudicial  law making on the plea that legislature could\t not
\nhave intended to give powers to the authorities or employers
\nwhich  would be violative of fundamental rights of the\tper-
\nsons  involved in the exercise of those powers\tand,  there-
\nfore, should be attributed those powers on conditions  which
\nwill  only make these legal or valid. Our law making  bodies
\nare  not law unto themselves and cannot create or  make\t all
\nlaws.  They  can  only confer powers or make  laws  for\t the
\nconferment  of\tpowers on authorities which  are  legal\t and
\nvalid.\tSuch powers conferred must conform to the  constitu-
\ntional inhibitions. [232C-D]
\n    3.2\t Legislation, both statutory and constitutional,  is
\nenacted\t from experience of evils. But its general  language
\nshould not necessarily be confined to the form that the evil
\nhad  taken place. Time works changes, brings into  existence
\nnew  conditions\t and purposes and new awareness\t of  limita-
\ntions. Therefore, a principle to be valid must be capable of
\nwider  application  than the mischief which gave  it  birth.
\nThis  is particularly true of the  constitutional  construc-
\ntions.\tConstitutions are not ephemeral enactments  designed
\nto  meet passing occasions, but designed to approach  immor-
\ntality\tas nearly as human institutions can approach it.  In
\nthe  application of a Constitutional limitation\t or  inhibi-
\ntion,  the interpretation cannot be only of ‘what has  been’
\nbut  of ‘what may be’. Therefore. in the  interpretation  of
\nthe provisions of an Act, where two constructions are possi-
\nble,  the one which leads towards constitutionality  of\t the
\nlegislation would be preferred to that which has the  effect
\nof
\n171<\/span>
\ndestroying  it. If the Courts do not read the conferment  of
\npower  in  the aforesaid manner, the power is liable  to  be
\nstruck down as bad. [233B-D]
\n    3.3\t The Court must proceed on the premise that the\t law
\nmaking\tauthority  intended to make a valid  law  to  confer
\npower validly or which will be valid. The freedom therefore,
\nto search the spirit of the enactment or what is intended to
\nobtain\tor  to find the intention of  parliament  gives\t the
\nCourt  the power to supplant and supplement the\t expressions
\nused  to  say  what was left unsaid. This  is  an  important
\nbranch\tof judicial power, the concession of which if  taken
\nto the\textreme is dangerous, but denial of that power would
\nbe ruinous and this is not contrary to the expressed  inten-
\ntion of the legislature or the implied purpose of the legis-
\nlation. [234G-H; 235A]
\n    3.4\t It has been said that if the legislature has  mani-
\nfested a clear intention to exercise an unlimited power,  it
\nis impermissible to read down the amplitude of that power so
\nas to make it limited. This cannot be agreed to. Our  legis-
\nlatures are limited by the constitutional inhibitions and it
\nis  made, that the Court should read their Acts\t and  enact-
\nments  with  the attribute that they know their\t limits\t and
\ncould  not have intended to violate the Constitution. It  is
\ntrue that the Court should be loath to read down where there
\nare  clear, unambiguous and positive terms in a\t legislation
\nand should proceed with a straight forward method of  strik-
\ning down such legislations. But where the statute is  silent
\nor not expressive or inarticulate, the Court must read\tdown
\nin  the silence of the statute and in the inarticulation  of
\nits provisions, the Constitutional inhibitions and transmute
\nthe major inarticulate premise into a reality and read\tdown
\nthe statute accordingly. [236H, 237A-B]
\n     3.5 The plain thrust of legislative enactment has to be
\nfound out in the inarticulate expressions and in the silence
\nof the legislation. In doing so, to say what the legislature
\ndid  not  specifically say is not distortion  to  avert\t any
\nconstitutional collision. [237E]
\n     In\t the  language\tof the relevant\t provisions  of\t the
\ninstant\t cases, there is no intention of the legislature  to
\nflout the constitutional limitations. [237E]
\n     Elliot Ashto Welsh 11 v. United States, 398 US 333,  26
\nEd. 2d. 308, referred to.\n<\/p>\n
     3.6  It  is  not that the reading down is\tused  for  a
\npurpose which is just the opposite which the legislature had
\nintended. Legislature had not
\n172<\/span>
\nintended  arbitrary  or\t uncontrolled-or  whimsical   power.
\nIndeed\tit  considered. This is not the proper way  to\tread
\nthat  power in the Regulation 9(b). Para 522 of the  Shastri
\nAward, read properly, must be circumscribed with the  condi-
\ntions  indicated  above as a necessary corollary  or  conse-
\nquence of that power. It is also not reading to the legisla-
\nture  conditions which were not there in the second  proviso
\nto Article 311(2) of the Constitution. [237H, 238A-B]
\n    Union of India & Anr. v. Tulsiram Patel,<\/a> [1985] Supp.  2
\nSCR 131, relied on.\n<\/p>\n
    No\tdoubt, absolute powers cannot be  regulated  without
\nessential  legislative\tpolicy,\t but in\t the  instant  cases
\nproperly read, absolute power was not there. Power that\t was
\nonly  constitutionally valid, that power can be presumed  to
\nhave been given and if that presumption is made,  conditions
\nindicated above inevitably attach. But these conditions\t are
\nnecessary corollary flowing from the conferment of the power
\nof  termination in a constitutional manner for\tthe  smooth,
\nproper and efficient running of the industry. [238C, E]
\n    3.7 In the circumstances power must be there, the  power
\nmust be read down in the manner and to the extent  indicated
\nabove,\tof terminating the services of\tpermanent  employees
\nwithout holding any enquiry in the stated contingencies\t and
\nthis would be either by virtue of the silence of the  provi-
\nsion  indicating  the  contingencies of\t termination  or  by
\nvirtue of constitutional inhibitions. That reading would not
\nviolate the theory that judges should not make laws.  [238F-
\nG]
\n    Shri Ram Krishna Dalmia v. Justice Tandolkar, [1959] SCR
\n279 at 299; Jyoti Prasad v. The Administrator for the  Union
\nTerritory of Delhi, [1962] 2 SCR 125 at 139; Union of  India
\nv.  Col.  J.N. Sinha & Anr.,<\/a> [1970] 2 SCC 450 at  461;\tN.C.
\nDalwadi\t v. State of Gujarat,<\/a> [1987] 3 SCC 611 paragraphs  9
\nand 10 at page 619; Commissioner of Sales Tax, M.P.,  Indore
\n& Ors. v. Radhakrishan & Ors.,<\/a> [1979] 2 SCC 249 at 257; Olga
\nTellis\t& Ors. etc. v. Bombay Municipal Corporation &  Ors.,
\n[1985]\tSuppl.\t2 SCR 51 at 89;\t R.M.D.\t Chamarbaugwalla  v.
\nUnion of India,<\/a> [1957] SCR 930 at p. 935 and 938; Kedar Nath
\nSingh v. State of Bihar, [1962] Supp. 2 SCR 769; R.L. Arora
\nv. State of Uttar Pradesh,<\/a> [1964] 6 SCR 784; Jagdish  Pandev
\nv. The Chancellor, University of Bihar & Anr., [1968] 1\t SCR
\n231, at pages 236-237; Sunil Batra v. Delhi Administration &
\nOrs.,<\/a>  [1978] 4 SCC 494; Tinsukhia Electric Supply Co.\tLtd.
\nv. State of Assam & Ors.,<\/a> [1989] 3 SCC 709; Charan Lal\tSahu
\n& Ors. v. Union of India,<\/a> [1989] Suppl. SCALE 1, at
\n173<\/span>
\npages 53 and 54, paras 101 as well as p. 61 para 114; Shah &
\nCo. v. State of Maharashtra, [1967] 3 SCR 466 at 477-78;  M.
\nPentiah\t and Ors. v. Veera-Mallappa and Ors., [1961]  2\t SCR
\n295;  Bangalore Water Supply and Sewerage Board etc.  v.  A.
\nRajappa & Ors., [1978] 3 SCR 207; Minerva Mills Ltd.&  Ors.,
\nv.  Union of India & Ors., [1981] 1 SCR 206, at p.  239\t and
\n259; Elliott Ashton Welsh, 11 v. United States, 26  Lawyers’
\nEdition\t 2nd, 308 at 327; Malinakhva Bysack v. Shyam  Sunder
\nHaldar\t& Ors.,<\/a> [1953] SCR 533, at p. 544-545 and  Municipal
\nCommittee, Amritsar & Anr. v. State of Punjab & ors.<\/a>, [1969]
\n3 SCR 447, referred to.\n<\/p>\n
    United  States of  America v. Edward A. Rumely, 97\tLaw-
\nyers Edition 770 at 775; Reg. v. Sadiers Co., 10 H.L.C. 404,
\n460  and 463; Framamus v. Film Artists Association, 1962  QB
\n527  at\t 542  and Seaford Court Estates, [1949]\t 2  KB\t481,
\nreferred to.\n<\/p>\n
    H.M.  Seervaid ‘Constitutional Law of India’,  3rd\tEdn.
\nVol.  1 pages 119-120 and Lord Denning: “The  discipline  of
\nLaw”, at p. 12, referred to.\n<\/p>\n
    3.8 Termination simpliciter under Regulation 9(b) of the
\nRegulation 1952, Delhi Road Transport Authority\t (Conditions
\nof Appointment and Services) or similar powers can be  exer-
\ncised  only in circumstances other than those in  Regulation
\n9(a).  The exercise of such powers can only be for  purposes
\ngermane\t and relevant to the statute, viz., the employee  is
\nincompetent  or unsuitable so as to make his continuance  in
\nthe  employment detrimental to the interest of the  institu-
\ntion,  or where the continuance of the employee is  a  grave
\nsecurity  risk\tmaking his continuance\tdetrimental  to\t the
\ninterest of the Corporation and where because of the conduct
\nof  the\t employee,  or there is lack of\t confidence  in\t the
\nemployee  which\t makes it necessary in the interest  of\t the
\nCorporation  to\t immediately terminate the services  of\t the
\nemployee  etc., etc. Therefore, each case of  conferment  of
\npower  involved\t should be judged on  the  aforesaid  basis.
\n[236E-G]
\n     3.9  Having regard to the finality of the\tposition  of
\nlaw  and having regard to the theory that parties  have\t ad-
\njusted\ttheir rights on the understanding of the law  as  it
\nwas, justice of the situation would be met if pending  liti-
\ngations are examined and disposed of in the light of  afore-
\nsaid principles. Where issues of damages or consequences  of
\ntermination  by\t virtue of exercise of the power  are  still
\npending\t adjudication  in any forum and have   been  finally
\nadjudicated, these should be re-examined by the\t appropriate
\nauthorities before whom these issues
\n174<\/span>
\nare  pending,  but previous terminations, where\t no  lis  is
\npending, will not be reopened. To that extent, the law\twill
\nbe prospective. [239D-F]\n<\/p>\n
    4. This Court. under Article 141 of the Constitution, is
\nenjoined to declare law. The expression ‘declared’ is  wider
\nthan  the words ‘found or made’. To declare is\tto  announce
\nopinion. Indeed, the latter involves the process. while\t the
\nformer\texpresses result. Interpretation, ascertainment\t and
\nevolution are parts of the process, while that\tinterpreted,
\nascertained  or\t evolved is declared as a law. The  law\t de-
\nclared\tby this Court is the law of the land. To  deny\tthis
\npower  to  this Court on the basis of some  outmoded  theory
\nthat  the Court only finds law but does not make it,  is  to
\nmake  ineffective the powerful instrument of justice  placed
\nin  the\t hands\tof the highest judiciary  of  this  country.
\nTherefore.  there should be a more active and creative\trole
\nfor the courts in declaring what the law is. [240E-G]\n<\/p>\n
    1. C. Golaknath & Ors. v. State of Punjab & Anr., [1967]
\n2 SCR 762 @ 811,813\/84, referred to.\n<\/p>\n
&
\n    CIVIL  APPELLATE JURISDICTION: Civil Appeal No. 2876  of
\n1986.\n<\/p>\n
    From the Judgment and Order dated 14.5.1986 of the Delhi
\nHigh Court in Civil Writ No. 1422 of 1985.\n<\/p>\n
    Soli J. Sorabji, Attorney General, Ashok Desai,  Solici-
\ntor  General, Vinod Bobade, M.C. Bhandare, M.K.\t Ramamurthy,
\nR.K. Garg, Mrs. Shyamala Pappu, P.P. Rao, Mrs. J. Wad,\tMrs.
\nAruna Mathur, Ms. A. Subhashini. P. Parmeshwaran, D.K. Garg,
\nA.K.  Sil, G. Joshi, S.K. Gupta, B.R. Sabharwal, Mrs.  Seita
\nVidyalingam,  S.K.  Bisaria  (NP),  Salman  Kurshid,  Irshad
\nAhmad, V.D. Phadke, A. Sharan, Lalit Bhasin, Ms. Nina Gupta,
\nVineet\tKumar,\tR.C. Bhatia, P.C. Kapur\t (NP),\tB.S.  Charya
\n(NP), Vijay K. Verma, C.M. Nayar, H.S. Munjral and  A.V.S.L.
\nSomayajulu (NP) for the appearing parties.
\nSatnam Singh appellant in person in C.A. No. 1115 of 1976.
\nThe Judgments of the Court were delivered by
\n    SABYASACHI\tMUKHARJI, CJ. These civil  appeals,  special
\nleave petitions and civil miscellaneous petitions deal\twith
\nthe question of constitutional validity of the right of\t the
\nemployer to terminate the
\n175<\/span>
\nservices of permanent employees without holding any  inquiry
\nin certain circumstances by reasonable notice or pay in lieu
\nof  notice. The facts involved in these matters are  diverse
\nbut the central question involved in all these is one,\ti.e.
\nwhether the clauses permitting the employers or the authori-
\nties concerned to terminate the employment of the  employees
\nby  giving  reasonable notice or pay in lieu of\t notice\t but
\nwithout holding any inquiry, are constitutionally valid and,
\nif  not,  what would be the consequences of  termination  by
\nvirtue\tof such clauses or powers, and further whether\tsuch
\npowers\tand  clauses could be so read with  such  conditions
\nwhich  would make such powers constitutionally\tand  legally
\nvalid?\tIn  order  to appreciate the  question\tthe  factual
\nmatrix of these cases so far as these are relevant for\tthe’
\ndetermination  of the aforesaid questions, will have  to  be
\nborne  in mind in the light of the actual  legal  provisions
\ninvolved in the respective cases.\n<\/p>\n
    It\twill, therefore, be proper and appropriate  to\tdeal
\nwith  the  relevant facts in civil appeal No. 2876  of\t1986
\nfirst.\tThe appellant herein–the Delhi\t Transport  Corpora-
\ntion,  is  a  statutory body formed  and  established  under
\nSection\t 3 of the Delhi Road Transport Act, 1950  read\twith
\nDelhi  Road  Transport (Amendment)  Act,  1971\t(hereinafter
\ncalled ‘the Act’). The appellant carries out the objects  of
\nvital  public  utility,\t according to  the  appellant,\ti.e.
\ntransport of passengers in the Union Territory of Delhi\t and
\nother areas. Respondent No. 2, Sri Ishwar Singh was appoint-
\ned as conductor therein on probation for a period of 1\tyear
\nin 1970. The probation period was extended thereafter for  a
\nfurther period of one year and thereafter he was regularised
\nin  service  of\t the appellant.\t Similarly,  respondent\t No.
\n3–Sri Ram Phal was appointed as Assistant Traffic  Incharge
\nand  after the probation period he was regularised in  serv-
\nice. Respondent No. 4–Sri Vir Bhan was appointed as  driver
\nand after completing the probation period he was also  regu-
\nlarised in service. It is stated that respondents Nos. 2  to
\n4  became, according to the appellant, inefficient in  their
\nwork and started inciting other staff members not to perform
\ntheir  duties. They were served with termination notices  on
\n4th  June,  1985  under Regulation 9(b) of  the\t Delhi\tRoad
\nTransport  Authority (Conditions of Appointment\t &  Service)
\nRegulations, 1952. On 11th June, 1985 respondents Nos. 2  to
\n4  and their Union being respondent No. I-DTC  Mazdoor\tCon-
\ngress, filed writ petition No. 1422\/85 in Delhi High  Court,
\nchallenging  the constitutional validity of Regulation\t9(b)
\nof  the\t Delhi\tRoad Transport Act. On 11th  May,  1986\t the
\ndivision  bench of the High Court of Delhi allowed the\tsaid
\nwrit  petition and struck down Regulation 9(b) of  the\tsaid
\nRegulations, and directed the appellant to
\n176<\/span>
\npay  back  respondents’ wages and benefits within  3  months
\nfrom  the  date\t of the said judgment. This  is\t an  appeal,
\ntherefrom,  by special leave. The question,  therefore,\t is,
\nwas the High Court justified in the view it took? It may  be
\nmentioned  that regulations 9(a) & (b) were framed in  exer-
\ncise  of the powers conferred u\/s 53 of the said Act,  which
\nenables the formulation of Regulations. Regulation 9 of\t the
\nsaid regulations, which is material for the present  contro-
\nversy, reads as follows:\n<\/p>\n
“9.  Termination of service: (a) Except as otherwise  speci-
\nfied in the appointment orders, the services of an  employee
\nof the authority may be terminated without any notice or pay
\nin lieu of notice:\n<\/p>\n
(i) During the period of probation and without assigning any
\nreason thereof.\n<\/p>\n
(ii) For misconduct,\n<\/p>\n
(iii) On the completion of specific period of appointment.\n<\/p>\n
(iv)  In  the case of employees engaged on  contract  for  a
\nspecific period, on the expiration of such period in accord-
\nance with the terms of appointment.\n<\/p>\n
(b) Where the termination is made due to reduction of estab-
\nlishment  or in circumstances other than those mentioned  at\n<\/p>\n
(a)  above, one month notice or pay in lieu thereof will  be
\ngiven to all categories of employees.\n<\/p>\n
(c) Where a regular\/temporary employee wishes to resign from
\nhis post under the authority he shall give three\/one month’s
\nnotice\tin writing or pay in lieu thereof to  the  Authority
\nprovided  that\tin special cases, the  General\tManager\t may
\nrelax,\tat  his\t discretion, the  conditions  regarding\t the
\nperiod of notice of resignation or pay in lieu thereof.”\n<\/p>\n
    The said Regulation, as set out hereinbefore, deals with
\ntermination of services. Four contingencies are contemplated
\nvide  clause (a) of Regulation 9, whereupon the services  of
\nemployees  may\tbe terminated without any notice or  pay  in
\nlieu thereof except as otherwise provided in the appointment
\norder. Apart from these four contingencies where termination
\nis made due to reduction of establishment
\n177<\/span>
\nor in circumstances other than those mentioned in clause (a)
\nabove, one month’s notice of pay in lieu thereof is required
\nto  be\tgiven  to all categories  of  employees.  Therefore,
\nexcept\tin  the said four cases, if there  is  reduction  of
\nestablishment or there is any termination uncovered by these
\nfour contingencies referred to in clause (a) the same  shall
\nbe  by giving one month’s notice or pay in lieu\t thereof  to
\nall  categories of employees. Clause (c) postulates  when  a
\nregular or temporary employee wishes to resign from his post
\nunder  the  authority then in such a situation\tone  month’s
\nnotice\tin writing or pay in lieu thereof to  the  authority
\nmay be provided.\n<\/p>\n
    The\t High Court in the judgment under appeal noted\tthat
\nsince  the  filing of this petition the\t notices  issued  by
\nD.T.C. to its various employees have been withdrawn and\t all
\nthese persons have been reinstated, therefore, the court was
\nnot concerned with the validity of clause (a) of  Regulation
\n9  but respondents Nos. 2 to 4 against whom action had\tbeen
\ntaken  by  the appellant by issuing notices  of\t termination
\nunder Regulation 9(b) had not been reinstated and the  court
\nconsidered  the validity of Regulation 9(b). It was held  by
\nthe  court that the said provision gave absolute,  unbridled
\nand  arbitrary\tpowers to the Management  to  terminate\t the
\nservices  of  any permanent or temporary  employee.  It\t was
\ncontended that such power was violative of Article 14 of the
\nConstitution.\n<\/p>\n
    In support of this contention, reliance had been placed,
\non which the High Court also relied upon, on the decision of
\nthis  Court  in Workmen of Hindustan Steel Ltd.\t &  Anr.  v.
\nHindustan Steel Ltd. & Ors.,<\/a> [1985] 2 SCR 428. In that case,
\nStanding  Order\t 31 of M\/s. Hindustan Steel Ltd.,  a  public
\nsector undertaking, had prescribed for a detailed  procedure
\nfor dealing with cases of misconduct; and for imposing major
\npenalty, the employer had to draw up a chargesheet and\tgive
\nan opportunity to the delinquent workman to make his  repre-
\nsentation within 7 days. If the allegations were controvert-
\ned, an enquiry had to be held by an officer to be  nominated
\nby the management and in such an enquiry reasonable opportu-
\nnity of explaining and defending the alleged misconduct\t had
\nto  be\tgiven to the workman. Suspension of  the  delinquent
\nworkman\t pending enquiry was also permitted. At the  end  of
\nthe  enquiry, if the charges were proved, and it was  provi-
\nsionally decided to impose any major penalty, the delinquent
\nworkman had to be afforded a further reasonable\t opportunity
\nto  represent why the penalty should not be imposed on\thim.
\nStanding Order 32 provided for a special procedure in case a
\nworkman\t was convicted for a criminal offence in a court  of
\nlaw or where the General
\n178<\/span>
\nManager was satisfied for reasons to be recorded in  writing
\nthat it was inexpedient or against the interests of security
\nto continue to employ the workmen’ viz. the workman could be
\nremoved\t or  dismissed from service  without  following\t the
\nprocedure  laid\t down in Standing Order No.  31.  There\t the
\nappellant was an Assistant in the respondent’s\tundertaking,
\nwho  was removed from service on the ground that it  was  no
\nlonger\texpedient  to employ him. The  management  dispensed
\nwith the departmental enquiry, after looking into the secret
\nreport\tof one of their officers that the appellant  therein
\nhad  misbehaved\t with  the wife of an employee\tand  that  a
\ncomplaint  in respect thereof had been lodged with  the\t po-
\nlice.  In  the\treference to the  Industrial  Tribunal,\t the
\nTribunal held that as the employer dispensed with the disci-
\nplinary enquiry in exercise of the power conferred by Stand-
\ning  Order 32, it could not be said that the  dismissal\t was
\nunjustified,  and that if there were allegations of  miscon-
\nduct,  the employer was quite competent to pass an order  of
\nremoval from service without holding any enquiry in view  of
\nthe provisions contained in Standing Order 32, and  rejected
\nthe reference. There was an appeal to this Court. This Court
\nheld that the reasons for dispensing with the enquiry do not
\nspell  out what was the nature of the misconduct alleged  to
\nhave  been committed by the appellant and what prompted\t the
\nGeneral\t Manager to dispense with the enquiry. As there\t was
\nno justification for dispensing with the enquiry, imposition
\nof penalty of dismissal without the disciplinary enquiry  as
\ncontemplated  by Standing Order 31 was illegal and  invalid.
\nIt was directed that the respondent should recall and cancel
\nthe  order  dated 24th August, 1970 removing  the  appellant
\nfrom  service,\tand reinstate him and on the  same  day\t the
\nappellant  was\tdirected to tender resignation of  his\tpost
\nwhich  should be accepted by the respondent. The  respondent
\nshould\tpay as and by way of back wages and future wages,  a
\nsum  of Rs.1.5 lakhs to the appellant within 2 months  which
\nshould be spread over from year to year commencing from\t the
\ndate  of removal from service. It was reiterated that  where
\nan  order  casts  a stigma or  affected\t livelihood,  before
\nmaking the order, principles of natural justice of a reason-
\nable  opportunity to present one’s case and  controvert\t the
\nadverse evidence must have full play. Even under the Consti-
\ntution\twhich  permits\tdispensing with\t the  inquiry  under
\nArticle 311(2) a safeguard is introduced that the  concerned
\nauthority  must specify reasons for its decision why it\t was
\nnot  reasonably\t practicable to hold the  inquiry.  Standing
\nOrder  32  nowhere obligates the General Manager  to  record
\nreasons\t for  dispensing with the inquiry as  prescribed  by
\nStanding  Order\t 31. On the contrary, it was held  that\t the
\nlanguage of Standing Order 32 enjoins a duty upon the Gener-
\nal Manager to record reasons for his satisfaction why it was
\ninexpedient
\n179<\/span>
\nor  against  the interest of the security of  the  State  to
\ncontinue to employ the workman. Reasons for dispensing\twith
\nthe  enquiry  and reasons for not continuing to\t employ\t the
\nworkman,  stand\t wholly apart from each\t other.\t This  Court
\nfinally\t observed  that it was time for\t the  public  sector
\nundertaking  to\t recast Standing Order, and to bring  it  in
\ntune  with the philosophy of the Constitution failing  which
\nthe  vires  of\tthe said Standing Order ,would\thave  to  be
\nexamined in an appropriate proceeding.\n<\/p>\n
    Reliance  was also placed before this Hon’ble  Court  on
\nthe decision of this Court in the case of West Bengal  State
\nElectricity  Board and Others v. Desh Bandhu Ghosh and\tOth-<\/a>
\ners,  [1985] 3 SCC 116, where this Court was concerned\twith
\nregulations  33 and 34 of the West Bengal State\t Electricity
\nBoard. The said regulations 33(1) and 34 were as follows:
\n“33(1)\tUnless otherwise specified in the appointment  order
\nin any particular case, the services of a permanent employee
\nof the Board may be terminated without notice–\n<\/p>\n
(i) on his attaining the age of retirement or by reason of a
\ndeclaration  by the competent medical authority that  he  is
\nunfit for further service; or\n<\/p>\n
(ii) as a result of disciplinary action;\n<\/p>\n
(iii) if he remains absent from duty, on leave or otherwise,
\nfor a continuous period exceeding 2 years.\n<\/p>\n
34.  In\t case of a permanent employee, his services  may  be
\nterminated by serving three months’ notice or on payment  of
\nsalary for the corresponding period in lieu thereof.”\n<\/p>\n
    The\t High Court had come to the conclusion in that\tcase
\nthat Regulation 34 was arbitrary in nature and suffered from
\nthe vice of enabling discrimination. The High Court,  there-
\nfore,  struck down the first paragraph of Regulation 34\t and
\nas a consequence quashed the order terminating the  services
\nof  the\t first respondent therein. It was  contended  before
\nthis  court on appeal that the Regulation 34 did not  offend
\nArticle 14 of the Constitution, that Sections 18-A and 19 of
\nthe  Electricity Supply Act laid down sufficient  guidelines
\nfor the exercise of the power under Regulation 34 and in any
\ncase  the power to terminate the services of  any  permanent
\nemployee  was vested in high ranking officials who might  be
\nexpected to exercise the same in a
\n180<\/span>
\nreasonable  way. This Court was unable to accept that  argu-
\nment.  This  Court was of the view that the  regulation\t was
\ntotally\t arbitrary and conferred on the Board a power  which
\nwas capable of vicious discrimination. This Court was of the
\nview  that it was naked ‘hire and fire’ rule, the  time\t for
\nbanishing  which, according to this Court in the said  deci-
\nsion,  altogether  from employer-employee  relationship\t was
\nfast approaching. It is only parallel, this Court was of the
\nview, to the Henry VIII clause so familiar to administrative
\nlawyers.\n<\/p>\n
    Reference was made to the decision of this Court in Moti
\nRam  Deka v. North East Frontier Railway, [1985] 5 SCR\t683,
\nwhere  Rules 148(3) and 149(3) of the Indian Railway  Estab-
\nlishment  Code had been challenged on the ground that  these
\nRules  were contrary to Article 311(2) of the  Constitution.
\nThe challenge was upheld though no opinion was expressed  on
\nthe  question  whether the rule offended Article 14  of\t the
\nConstitution  or not since then Article 14 has\tbeen  inter-
\npreted in several decisions of this Court and conferment and
\nexercise  of  arbitrary\t power on and by the  State  or\t its
\ninstrumentalities have been frowned upon and struck down  by
\nthis Court as offending Article 14 of the Constitution.
\n    Indeed,  it\t was  noted in S.S. Muley  v.  J.R.D.  Tara,
\n[1979]\t2  SLR 438 by this Court that,\tJustice\t Sawant,  of
\nBombay High Court had considered at great length  Regulation
\n48(a) of the Air India Employees’ Service Regulations  which
\nconferred similar power on the Corporation as Regulation  34
\nconfers on the Board in the present case. The learned  Judge
\ntherein (Sawant, J.) had struck down that Regulation.  Reli-
\nance had also been placed on another decision of the  Bombay
\nHigh  Court in the case of Manohar P. Kharkhar v.  Raghuraj.
\n[1981]\t2 LLJ 459. This Court found it difficult  to  accept
\nthe reasoning therein. In that view of the matter the appeal
\nwas dismissed.\n<\/p>\n
    Reference  in  this connection may also be made  to\t the
\ndecision  of  this Court in Central Inland  Water  Transport
\nCorporation Limited and Anr. v. Brojo Nath Ganguly and Anr.,<\/a>
\n[1986]\t3  SCC 156. There the  appellant-Corporation  was  a
\nGovernment company incorporated under the Companies Act. The
\nmajority  shares of the Corporation were held by the  States
\nof  West  Bengal and Assam. Article 51 of  the\tArticles  of
\nAssociation of the Corporation conferred upon the  President
\nof  India power to issue  directions\/instructions  regarding
\naffairs and conduct of the business of the Corporation or of
\nthe  Directors thereof as also regarding exercise  and\tper-
\nformance  of its functions pertaining to  national  security
\nand public interest. Article 51-A of the
\n181<\/span>
\nsaid  articles entitled the President to call  for  returns,
\naccounts  etc. of the Corporation. Articles 14, 15,  16,  17
\nand  37\t conferred  on the President power  to\tappoint\t and
\nremove\tChairman and the Board of Directors of the  Corpora-
\ntion.  Articles\t 41 and 42 were regarding  the’\t President’s
\ncontrol\t over  the working of the  Corporation.\t Article  47
\nprovided for appointment of the auditors of the\t Corporation
\nto  be made by the Central Government on the advice  of\t the
\nComptroller’ and Auditor-General of India and the nature  of
\ncontrol\t to  be exercised by the  Comptroller  and  Auditor-
\nGeneral\t in the matter of audit and accounts. Since  another
\ncompany\t namely\t the Rivers Steam Navigation  Co.  Ltd.\t was
\ncarrying on the same business as the Corporation was  doing,
\na Scheme of Arrangement was entered into between the  Corpo-
\nration\tand that Company for dissolution of the\t latter\t and
\ntaking\tover of its business and liabilities by the  former.
\nThe  Scheme,  inter alia, stipulated  that  the\t Corporation
\nshall  take as many of the existing staff or labour as\twere
\npossible and that those who could not be taken over shall be
\npaid by the transferor company all moneys due to them  under
\nthe  law and all legitimate and legal compensations  payable
\nto  them either under Industrial Disputes Act  or  otherwise
\nlegally admissible and that such moneys shall be provided by
\nthe Government of India to the transferor Company who  would
\npay these dues. The Calcutta High Court approved the Scheme.
\nEach  of the respondents therein were in the service of\t the
\nsaid company. Their services were taken over by the Corpora-
\ntion  after the High Court’s sanction to the Scheme  of\t Ar-
\nrangement. While the respondent Ganguly therein was appoint-
\ned  as the Deputy Chief Accounts Officer and was later\tpro-
\nmoted  as  Manager (Finance), the  respondent  Sengupta\t was
\nappointed  as Chief Engineer (River Services) and was  later
\npromoted as General Manager (River Services)- Their appoint-
\nment letters were in stereotype forms under which the Corpo-
\nration\tcould  without any previous notice  terminate  their
\nservices, if the Corporation was satisfied that the employee
\nwas unfit medically or if he was guilty of any\tinsubordina-
\ntion, intemperance or other misconduct, or of any breach  of
\nany  rules  pertaining to this service or  conduct  or\tnon-
\nperformance  of his duties. The letters of appointment\tfur-
\nther  stipulated  that they would have been subject  to\t the
\nrules  and  regulations\t of Corporation. Rule  9(i)  of\t the
\nCorporation’s  Service, Discipline and Appeal Rules of\t1979
\nhad  provided that the services of permanent employee  could
\nbe  terminated on three months’ pay plus DA to the  employee
\nor on deduction of a like amount from his salary as the case
\nmight  be in lieu of the notice. By confidential letter\t the
\nrespondent Ganguly was asked to reply within 24 hours to the
\nallegations of negligence made against him. After having his
\nrepresentation and detailed reply, a notice under
\n182<\/span>
\nRule  9(i) was served on him terminating his  services\twith
\nimmediate  effect by paying three months’ pay.\tSimilarly  a
\ncharge-sheet was issued to the respondent Sengupta  intimat-
\ning  that  a disciplinary inquiry was proposed\tagainst\t him
\nunder  the  Rules and calling upon him to file\this  written
\nstatement  of  defence.\t Sengupta denied  the  charges\tmade
\nagainst him and asked for inspection of documents and copies
\nof  statements\tof witnesses mentioned in the  said  charge-
\nsheet.\tBut  a notice was serviced on him  under  Rule\t9(i)
\nterminating  his  services with immediate effect  of  paying
\nthree  months’ salary. Both Ganguly and Sengupta filed\tWrit
\nPetitions before High Court. A Division Bench of that  Court
\nallowed the same. The Corporation filed appeals before\tthis
\nCourt. The main questions for determination therein were (i)
\nwhether the appellant-Corporation was an instrumentality  of
\nthe  State  as\tto be covered by Article 12 and\t 36  of\t the
\nConstitution  and (ii) whether an unconscionable term  in  a
\ncontract of employment entered into with the Corporation was
\nvoid  under Section 23 of the Contract Act and violative  of
\nArticle\t 14  of the Constitution and as\t such  whether\tRule
\n19(i)  which formed part of the contract of  employment\t be-
\ntween  the  Corporation and its employees to whom  the\tsaid
\nRules  applied, was void? This Court confirmed the  judgment
\nof the High Court with modification in the declaration\tmade
\nand  dismissed the Corporation’s appeal to this Court.\tThis
\nCourt  held that the appellant was State within the  meaning
\nof  Article 12 of the Constitution. This Court further\theld
\nthat  an unconscionable bargain or contract is one which  is
\nirreconcilable with what is right or reasonable or the terms
\nof which are so unfair and unreasonable that they shock\t the
\nconscience of the Court. This Court was of the view that the
\ndoctrine of distributive justice is another  jurisprudential
\nconcept\t which has affected the law of contracts.  According
\nto  that doctrine, distributive fairness and justice in\t the
\npossession of wealth and property could be achieved not only
\nby taxation and regulatory control of private and contractu-
\nal  transactions even though this might involve some  sacri-
\nfice of individual liberty. This Court referred to  articles
\n38 and 39 of the Constitution so far as the test of reasona-
\nbleness\t was concerned. The test of reasonableness or  fair-
\nness of a clause in a contract where there was inequality of
\nbargaining power is another theory recognised in the  sphere
\nof law of contacts. It was reiterated in that decision\tthat
\nthe Courts will not enforce and will, when called upon to do
\nso,  strike down an unfair and unreasonable contract,  or  a
\nclause\tin the contract. Reference was made to the  observa-
\ntions  of Lord Diplock in A. Schroeder Music Publishing\t Co.
\nLtd.  v. Macaulay (formerly Instone), [1974] i\tW.L.R.\t1308
\nand that test was:\n<\/p>\n
183<\/span><\/p>\n
“Whether the restrictions are both reasonably necessary\t for
\nthe  protection of the legitimate interests of the  promisee
\nand  commensurate with the benefits secured to the  promiser
\nunder  the  contract? For the purpose of this test  all\t the
\nprovisions   of\t  the\tcontract   must\t  be   taken\tinto
\nconsideration.”\n<\/p>\n
    Justice  Madon of this Court in the said decision  found
\nthat this was in consonance with right and reason,  intended
\nto  secure social and economic justice and conformed to\t the
\nmandate of the equality clause in Article 14 of the  Consti-
\ntution. It was further recognised that there might be myriad
\nsituations which result in unfair and unreasonable  bargains
\nbetween\t parties  possessing  wholly  disproportionate\t and
\nunequal bargaining power. These cases can neither be enumer-
\nated  nor fully illustrated. The Court must judge each\tcase
\non  its\t own facts and circumstances.  The  above  principle
\nwould apply, this Court reiterated, where the inequality  of
\nbargaining  power  is  the result of the  disparity  in\t the
\neconomic  strength of the contracting parties or  where\t the
\ninequality  is the result of circumstances, whether  of\t the
\ncreation of the parties or not or where the weaker party  is
\nin a position in which he could obtain goods or services  or
\nmeans  of  livelihood  only upon the terms  imposed  by\t the
\nstronger  party\t or go without them or where a\tman  had  no
\nchoice,\t or  rather no meaningful choice, but  to  give\t his
\nassent\tto a contract or to sign on the dotted line in\tpre-
\nscribed or standard form or to accept a set of rules as part
\nof  the contract, however, unfair, unreasonable\t and  uncon-
\nscionable clause in that contract or form or rules might be.
\nThis  Court, however, reiterated that this  principle  would
\nnot  apply  where the bargaining power\tof  the\t contracting
\nparties\t is equal or almost equal. This principle would\t not
\napply where both parties are businessmen and the contract is
\na  commercial  transaction. The contracts of  this  type  to
\nwhich  the principle formulated above applied were not\tcon-
\ntracts which were tainted with illegality but were contracts
\nwhich contained terms which were so unfair and\tunreasonable
\nthat  they  shock the conscience of the Court. In  the\tvast
\nmajority  of  cases such contracts are entered into  by\t the
\nweaker\tparty  under pressure  of  circumstances,  generally
\neconomic,  which results in inequality of bargaining  power.
\nSuch contracts will not fall within the four corners of\t the
\ndefinition  of “undue influence” given in Section  16(1)  of
\nthe  Contract  Act, even though at times  they\tare  between
\nparties one of whom holds a real or apparent authority\tover
\nthe  other.  Contracts in prescribed or\t standard  forms  or
\nwhich  embody  a set of rules as part of  the  contract\t are
\nentered\t into  by the party with superior  bargaining  power
\nwith large number of persons or
\n184<\/span>
\na  group of persons, if they are unconscionable, unfair\t and
\nunreasonable,  are injurious to the public interest,  should
\nbe  adjudged void according to Justice Madon, under  Section
\n23  of\tthe Contract Act on the ground of being\t opposed  to
\npublic policy. Public policy, it was reiterated, is not\t the
\npolicy of any particular Government. It connotes some matter
\nwhich concerns the public good and the public interest.\t The
\nprinciples  governing public policy must be and are  capable
\non  proper occasion, of expansion or modification. If  there
\nis  no head of public policy which covers a case,  then\t the
\nCourt  must  in\t consonance with public\t conscience  and  in
\nkeeping\t with public goods and public interest declare\tsuch
\npractice  to be opposed to public policy. In any case  which
\nis not covered by authority, courts should be guided by\t the
\nPreamble  to the Constitution and the principles  underlying
\nthe  Fundamental Rights and the Directive  Principles.\tRule
\n9(i) can aptly be called ‘the Henry VIII Clause” this  Court
\nopined\ttherein. It confers an absolute, arbitrary  and\t un-
\nguided\tpower upon the Corporation to exercise\tthat  power.
\nThis  Court  was concerned with the  “Central  Inland  Water
\nTransport  Corporation\tLtd. Service Discipline\t and  Appeal
\nRules” framed by the Corporation. The relevant provisions of
\nthe said Rule 9 relating to permanent employees therein were
\nas follows:\n<\/p>\n
“9. Termination of employment for Acts other than  misdemea-
\nnour–\n<\/p>\n
(i) The employment of a permanent employee shall be  subject
\nto  termination on three months’ notice on either side.\t The
\nnotice\tshall be in writing on either side. The Company\t may
\npay  the equivalent of three months basic pay  and  dearness
\nallowances,  if any, in lieu of notice or may deduct a\tlike
\namount when the employee has failed to give due notice.\n<\/p>\n
(ii) The services of a permanent employee can be  terminated
\non the grounds of “services no longer required in the inter-
\nest  of the Company” without assigning any reason. A  perma-
\nnent  employee\twhose  services are  terminated\t under\tthis
\nclause shall be paid 15 days’ basic pay and dearness  allow-
\nance  for each completed year of continuous service  in\t the
\nCompany as compensation. In addition he will be entitled  to
\nencashment of leave to his credit.”\n<\/p>\n
This  Court  found that Rule 9(i) can be called\t ‘the  Henry
\nVIII
\n185<\/span>
\nClause’.  It  confers an  absolute,-arbitrary  and  unguided
\npower  upon  the Corporation. It does not even\tsay  who  on
\nbehalf of the Corporation was to exercise that power.  While
\nthe  Rules  provided for four different modes in  which\t the
\nservices of a permanent employee could be terminated earlier
\nthan his attaining the age of superannuation, namely,  Rules
\n9(i), 9(ii), 36(iv)(b) read with 38 and 37, Rule 9(i) is the
\nonly  rule  which does not state in what  circumstances\t the
\npower  conferred by that rule is to be exercised. Thus\teven
\nwhere  the Corporation could proceed under a regular  disci-
\nplinary\t inquiry, it is free to resort instead to Rule\t9(i)
\nin order to avoid the trouble of an inquiry. No\t opportunity
\nof  a  hearing\twas at all intended to be  afforded  to\t the
\npermanent employee whose service was being terminated in the
\nexercise of that power. It violated audi alteram partem rule
\nof natural justice also which was implicit in Article 14  of
\nthe Constitution. It is not covered by any of the situations
\nwhich would justify the total exclusion of the audi  alteram
\nparterm rule. The view that the Board of Directors would not
\nexercise  this power arbitrarily or capriciously as it\tcon-
\nsisted of responsible and highly placed persons ignored,  it
\nwas held, the fact that however highly placed a person might
\nbe,  he must necessarily possess human frailties and  “power
\ntends  to corrupt, and absolute power corrupts\tabsolutely.”
\nIt was, however, held that Rule 9(i) was also discriminatory
\nfor the Corporation was given power to discriminate  between
\nemployee  and employee. It was stated that it could back  up
\none  employee and apply to him Rule 9(i). It could  pick  up
\nanother employee and apply to him Rule 9(ii). It was further
\nreiterated  that the Corporation was a\tlarge  organisation.
\nThe  said  Rules formed part of the contract  of  employment
\nbetween\t the  Corporation  and its employees  who  were\t not
\nworkmen.  These employees had no powerful Union\t to  support
\nthem.  They had no voice in the framing of the\tsaid  Rules.
\nThey  had no choice but to accept the said Rules as part  of
\ntheir  contract\t of employment. There  was  gross  disparity
\nbetween\t the Corporation and its employees, whether they  be
\nworkmen\t or officers. The Corporation could afford  to\tdis-
\npense  with  the services of an officer and will  find\tmany
\nothers\tto  take his place but an officer cannot  afford  to
\nlose his job because if he does so, there are not many\tjobs
\nwaiting for him. It was, therefore, held that clause 9(i) of
\nthe said regulation was against right and reasons and it was
\nwholly\tunconscionable.\t It had been  entered  into  between
\nparties between whom there was gross inequality of  bargain-
\ning power. Rule 9(i) was a term of the contract between\t the
\nCorporation and all its officers, it was noted. It  affected
\na large number of persons and it squarely fell within
\nthe  principle stated earlier. The Government and its  agen-
\ncies  and instrumentalities constitute the largest  employer
\nin the country. A
\n186<\/span>
\nclause such as Rule 9(i) in a contract of employment, it was
\nnoted,\taffecting large sections of the public\twas  harmful
\nand injurious to the public interest for it tended to create
\na  sense  of  insecurity in the minds of those\tto  whom  it
\napplied and consequently against public good. Such a clause,
\ntherefore,  was opposed to public policy and as such  it  is
\nvoid  under Section 23 of the Contract Act, it was held.  It
\nwas  further  held that it was not possible  to\t accept\t the
\ncontention  that  this was a contract entered  into  by\t the
\nCorporation  like any other contract entered into by  it  in
\nthe  course of its trading activities and the Court,  there-
\nfore,  ought not to interfere with it. The  employees  could
\nnot  be equated with goods which could be bought  and  sold,
\nnor could a contract of employment be equated with a mercan-
\ntile transaction between two businessmen much less when\t the
\ncontract of employment was between a powerful employer and a
\nweak employee. Although it was reiterated that the aforesaid
\nrule  9(i)  was supported by mutuality inasmuch as  it\tcon-
\nferred an equal right upon both the parties but\t considering
\nthe  unequal position of the Corporation and its  employees,
\nthere  was  no\treal mutuality, this Court  opined.  It\t was
\nreiterated that the Corporation being covered by Article 12,
\nits  actions must also be in accordance with  the  Directive
\nPrinciples prescribed by Part IV of the Constitution. Refer-
\nence  may be made to paragraph 39 of the aforesaid  decision
\nwhere this Court noted that in the working of the  Constitu-
\ntion,  it was found that some of the provisions of the\tCon-
\nstitution were not adequate for the needs of the country  or
\nfor  ushering  in a Welfare State and the  constituent\tbody
\nempowered  in that behalf amended the  Constitution  several
\ntimes. By the very first amendment made in the Constitution,
\nnamely,\t by  the Constitution (First  Amendment)  Act,\t1951
\nclause\t(6) of Article 19 was amended  with  retrospectitive
\neffect.\t Under\tthis amemdment, sub-clause  (g)\t of  Article
\n19(1) which guarantees to all citizens the right to carry on
\noccupation, trade or business, was not to prevent the  State
\nfrom  making  any  law relating to the carrying\t on  by\t the
\nState, or by a Corporation owned or controlled by the State,
\nof any trade, business, industry or service, whether to\t the
\nexclusion,  complete  or partial of citizens  or  otherwise.
\nThis amendment also validated the operation of all  existing
\nlaws  insofar as these had made similar provisions.  Article
\n298  of\t the Constitution, as originally  enacted,  provided
\nthat the executive power of the Union and of each State\t was
\nto extend, subject to any law made by the appropriate legis-
\nlature,\t to the grant, sale, disposition or mortgage of\t any
\nproperty held for the purposes of the Union or of such State
\nas  the case may be, and to the purchase or  acquisition  of
\nproperty for those purposes respectively, and to the  making
\nof  contracts.\tand it further provided\t that  all  property
\nacquired for the purposes of the Union or of
\n187<\/span>
\nState was to vest in the Union or in such State, as the case
\nmight be. This Court referred to the decision of this  Court
\nin Sukhdev v. Bhagatrarn Sardar Singh Raghuvanshi,<\/a>  [1975] 3
\nSCR  619,  “the\t Governing power wherever  located  must  be
\nsubject to the fundamental constitutional limitations.”\n<\/p>\n
    The\t High Court in the judgment under appeal was  unable
\nto  accept  the plea of alternative remedy and\tallowed\t the
\nWrit  Petition and declared regulation 9(b) of\tthe  Regula-
\ntions  to  be illegal and ultra vires and as  a\t consequence
\nthereof\t the orders terminating the services of\t respondents
\nNos.  1 to 4 were quashed and these respondents were  deemed
\nto  be\tin the service of DTC and back wages and  all  other
\nbenefits  by  way of annual increments were directed  to  be
\npaid.\n<\/p>\n
    Learned  Solicitor General of India contended before  us
\nthat in the facts and the circumstances of this case,  there
\nwas  sufficient\t guideline in the Regulation  9(b)  and\t the
\npower of termination, properly read, would not be  arbitrary
\nor  violative of Article 14 of the Constitution. It  may  be
\nmentioned that under the general law of contract of  employ-
\nment,  which  was commonly known as the ‘law of\t master\t and
\nservant’, which is not termed as law of employer and employ-
\nee, whether the contract of service is for a fixed period or
\nnot,  if  it contained a provision for\tits  termination  by
\nnotice, it could be so terminated. If there was no provision
\nfor  giving  notice  and the contract was not  for  a  fixed
\nperiod,\t the law implied an obligation to give a  reasonable
\nnotice.\t Where no notice in the first case or no  reasonable
\nnotice\tin  the second case was given and the  contract\t was
\nwrongfully terminated, such wrongful termination would\tgive
\nrise  to a claim for damages. In this connection,  reference
\nmay  be made to the observations of this Court in the  five-
\njudge  bench decision in Union of India & Anr. v. Tulsi\t Ram
\nPatel,<\/a>\t[1985] Supp. 2 SCR 131 at p. 166. This is  also\t the
\nposition at common law. See Chitty on Contract; 26th Edition
\nVol.  II, p. 808 or 25th Edition Vol. II p.  712,  paragraph
\n3490.  In  this connection, reliance may also be  placed  at
\nparagraphs  607\t and 608 of Volume No. 16,  4th\t Edition  of
\nHalsbury’s Law of England.\n<\/p>\n
    Under the Industrial Law, subject to the relevant statu-
\ntory provision, the services of an employee could be  termi-
\nnated  by  reasonable notice. In such a case it\t was  always
\nopen to the Industrial Tribunal to examine whether the power
\nof termination by reasonable notice was exercised bona\tfide
\nor  mala fide. If, however, the industrial Court was  satis-
\nfied  that the order of discharge was punitive, that it\t was
\nmala  fide, or that it amounted to victimisation  or  unfair
\nlabour practice, the
\n188<\/span>
\nindustrial court was competent to set aside the order and in
\nproper\tcases,\tdirect the reinstatement  of  the  employee.
\nReference may also be made to the observations of this Court
\nin  Tata Oil Mills Co. Ltd. v. Workmen & Anr.,<\/a> [1964] 2\t SCR
\n125  at\t 130. If, however, the exercise of  such  power\t was
\nchallenged on the ground of being colourable or mala fide or
\non  account of victimisation or unfair labour practice,\t the
\nemployer  must disclose to the Court the ground of  his\t im-
\npugned\taction, so that the same may be\t tested\t judicially.
\nSee  the observations of this Court in L. Michael & Anr.  v.
\nM\/s Johnston Pumps India Ltd.,<\/a> [1975] 3 SCR 489 at 498.
\n    The relationship between a statutory corporation and its
\nemployees is normally governed by the relevant rules,  regu-
\nlations\t and  standing orders. A  statutory  Corporation  is
\n“State” within the meaning of Article 12 of the Constitution
\nand  its  action is subject to judicial\t review\t in  certain
\ncases  and certain circumstances. In the facts\tand  circum-
\nstances of these cases, we have proceeded on that basis\t and
\nwe  are\t of the opinion that it is the\tcorrect\t basis.\t The
\nexercise of such power under regulations similar to the\t one
\nimpugned which has been upheld in various types of cases are
\ninstructive  in their variety. It may be mentioned that\t the
\nexercise  of power under the very same Regulation  9(b)\t was
\nupheld by the Court in a matter, wherein in an action by the
\nemployee  of D.T.C., this Court in Delhi Transport  Corpora-
\ntion  Undertaking v. Balbir Saran Goel,<\/a> [1970] 3 SCR 757  at
\n764  held  that\t even if the  employees\t of  the  respondent
\nthought\t that he was a cantankerous man and it was  not\t de-
\nsirable\t to  retain him in service it was open\tto  them  to
\nterminate  his services in terms of Regulation 9(b)  and  it
\nwas  not necessary to dismiss by way of punishment for\tmis-
\nconduct.\n<\/p>\n
    Reliance  was placed on this decision by the High  Court
\nin the Judgment under appeal. The High Court in our  opinion
\nrightly\t pointed  out, however, that the decision was  on  a
\ndifferent  basis  and could not be availed  of\tin  deciding
\ncontroversy  involved in the present determination.  In\t Air
\nIndia Corporation, Bombay v. V.A. Rebellow & Anr.,<\/a> [1972]  3
\nSCR 606, this Court dealing with the power of the Air  India
\nto  terminate  the services of a person who was\t alleged  to
\nhave misbehaved with air hostesses, observed on page 6 16 of
\nthe report that the anxiety of the Legislature to effective-
\nly achieve the object of duly protecting the workmen against
\nvictimisation  of unfair labour practice  consistently\twith
\nthe preservation of the employer’s bona fide right to  main-
\ntain discipline and efficiency in the industry for  securing
\nthe maximum production in peaceful, harmonious atmosphere is
\nobvious from the
\n189<\/span>
\noverall scheme of these sections. This Court on page 620  of
\nthe  report observed that the record merely  disclosed\tthat
\nthe  appellant had suspicion about the\tcomplainant’s  suit-
\nability for the job in which he was employed and this led to
\nloss of confidence in him with the result that his  services
\nwere  terminated under Regulation 48. Loss of confidence  in
\nsuch circumstances could not be considered to be mala  fide,
\nit  was held. Similarly in Municipal Corporation of  Greater
\nBombay\tv. P.S. Malvenkar & Ors.,<\/a> [1978] 3 SCR 1000 at\tpage
\n1006, where it was alleged that the services of an  employee
\nof  Bombay Municipal Corporation were  unsatisfactory,\tthis
\nCourt held that the powers of dismissal after an inquiry and
\nthe  powers of simpliciter termination are to  distinct\t and
\nindependent powers and as far as possible neither should  be
\nconstrued  so  as to emasculate the other or  to  render  it
\nineffective.  One  is the power to punish  an  employee\t for
\nmisconduct  while the other is the power to  terminate\tsim-
\npliciter  the service of an employee without any  other\t ad-
\nverse consequence.\n<\/p>\n
    It may be mentioned that the case of civil servants\t is,
\nhowever,  governed by their special constitutional  position
\nwhich  accords them status; the legal relationship  (between
\nthe  Government\t and  its servants)  is\t something  entirely
\ndifferent,  something  in the nature of status. It  is\tmuch
\nmore  than  a purely  contractual  relationship\t voluntarily
\nentered\t into between the parties. The duties of  state\t are
\nfixed  by  the law and in the enforcement  of  these  duties
\nsociety\t has an interest. In the language  of  jurisprudence
\nstatus\tis  a condition of membership of a  group  of  which
\npowers and duties are exclusively determined by law and\t not
\nby agreement between the parties concerned. See the observa-
\ntions of this Court in Roshan Lal Tandon v. Union of  India,<\/a>
\n[1968] 1 SCR 185 at 195 D-E. But even then the services of a
\ntemporary civil servant (although entitled to the protection
\nof  Article 311 of the Constitution) is subject to  termina-
\ntion  by  notice. But beside the above, the  government\t may
\nfind  it necessary to terminate the services of a  temporary
\nservant\t if  it\t is not satisfied with his  conduct  or\t his
\nsuitability  for the job and\/or his work. See  the  observa-
\ntions  of this Court in Champak Lal Chiman Lal Shah  v.\t The
\nUnion  of India,<\/a> [1964] 5 SCR 190 at 204. The services of  a
\ntemporary government servant, further. may be terminated  on
\none month’s notice whenever the government thinks it  neces-
\nsary or expedient to do so for administrative reasons. It is
\nimpossible,  this Court observed, to define before hand\t all
\nthe circumstances in which the discretion can be  exercised.
\nThe  discretion was necessarily left to the Government.\t See
\nobservations of this Court in Ram Gopal Chaturvedi v.  State
\nof  M. P.,<\/a> [1970] 1 SCR 472 at 475.\n<\/p>\n
190<\/span><\/p>\n
    The aforesaid position of a government servant has\tbeen
\nanalysed in depth by the decision of this Court in Union  of
\nIndia  v. Tulsi Ram Patel,<\/a> (supra), where it was  reiterated
\nthat  the doctrine of pleasure is not a relic of the  feudal
\nages or based upon any special prerogative of the Crown\t but
\nis based on public interest and for the public good  because
\nit  is as much in public interest and for public  good\tthat
\ngovernment  servants who are inefficient, dishonest or\tcor-
\nrupt  or have become a security risk should not continue  in
\nservice and that the protection afforded to them by the Acts
\nand  the Rules made under Article 309 and by Article 311  of
\nthe  Constitution be not abused by them to the detriment  of
\nthe  public interest and public good. It was  reiterated  on
\npage  190 of the report that if in a situation as  envisaged
\nin one of the three clauses of the second proviso to  Clause
\n(2) of Article 311 arises and the relevant clause is proper-
\nly applied and the disciplinary inquiry dispensed with,\t the
\nconcerned  government  servant cannot be heard\tto  complain
\nthat he is deprived of his livelihood. This Court reiterated
\nthat  the livelihood of an individual is a matter  of  great
\nconcern to him and his family but his livelihood is a matter
\nof his private interest where such livelihood is provided by
\nthe public exchequer and the taking away of such  livelihood
\nis  in the public interest and for the public good, and\t the
\nformer must yield to the latter public policy, it was  reit-
\nerated,\t requires,  public interest needs  and\tpublic\tgood
\ndemands that there should be such a doctrine. It was further
\nreiterated that the rules of natural justice are not immuta-
\nble but flexible. These rules can be adopted and modified by
\nstatutes and statutory rules and also by the constitution of
\nthe Tribunal which has to decide a particular matter and the
\nrules by which such Tribunal is governed. Not only, can\t the
\nprinciples of natural justice be modified but in exceptional
\ncases  they  can even be excluded. See the  observations  of
\nthis Court at page 237 G of the aforesaid report.  Reference
\nwas  also  made to the observations of this Court  at  pages
\n214-215\t of  the aforesaid report.  Thus,  the\tConstitution
\nBench laid down that even where a government servant  enjoys
\nconstitutional\tstatus there can be exclusion of inquiry  in
\nthe cases prescribed for termination of employment.
\n    It\tmust, however, be borne in mind that in some  recent
\ncases  this Court has taken the view that a regulation\tpro-
\nviding for the termination of the service of an employee  of
\nthe public corporation by notice only or pay in lieu thereof
\nis  invalid  under Article 14 of the Constitution.  We\thave
\nreferred  to  the  decisions of\t the  Workmen  of  Hindustan
\nSteel’s case (supra); West Bengal State Electricity  Board’s
\ncase  (supra)  and Central Inland Water\t Transport  Corpora-
\ntion’s case (supra). Mr.
\n191<\/span>
\nAshok  Desai, learned Solicitor General of  India  submitted
\nthat  the  decisions in the West  Bengal  State\t Electricity
\nBoard’s (supra) and Central Inland Water Transport  Corpora-
\ntion’s\tcase (supra) were incorrectly decided and the  deci-
\nsion proceeded on the theory of unconscionable bargains\t and
\nthat  termination  by notice is against public\tpolicy.\t He,
\nhowever, drew our attention to Gheru Lal Parekh v.  Mahadeo-
\ndas Maiya & Others, [1959] Supp. 2 SCR 406 and 440 where  it
\nwas held that though theoretically it may be permissible  to
\nevolve\ta  new\thead under exceptional\tcircumstances  in  a
\nchanging world, it is advisable in the interest of stability
\nof society not to make any attempt to discover new heads  of
\navoidance  of  such clauses in these days.  Furthermore,  as
\nstated\tabove, learned Solicitor General submitted  that  in
\nthe  ordinary law of contract termination of  employment  by
\nreasonable notice on either side has never been regarded  as
\nunconscionable.\t Therefore,  the learned  Solicitor  General
\nsubmitted that this part of the above judgments was  errone-
\nous and should be overruled.\n<\/p>\n
    It\tmust, however, be noted that in a later judgment  of
\nthis  Court, which followed this line of reasoning,  it\t was
\nrecognised  that  a public corporation\trequires  protection
\nfrom  employees\t who  are inefficient or  those\t who  lacked
\nprobity or even made faulty policy decisions. Reference\t was
\nmade  to the decision of this Court in O.P. Bhandari  v.  1.
\nT.D.C.\t& Ors., [1986] 4 SCC 337 where this Court held\tthat
\nso far as some of the higher placed employees are  concerned
\n(described as ‘gold collar’ employees) public sector  under-
\ntakings may be exposed to irreversible damage on account  of
\nfaulty policy decisions or on account of lack of  efficiency
\nor probity of such employees and its very existence might be
\nendangered  beyond recall. A public corporation may  not  be
\nable to cut the dead wood and get rid of a managerial  cadre
\nemployee in case he is considered to be wanting in  perform-
\nance  or integrity. Reference may be made to page 343  para-
\ngraph  5 (supra) of the report. It may be mentioned that  in
\nMoti Ram Deka’s case (supra) at p. 707 of the said report, a
\nsimilar\t rule was considered by seven learned Judges in\t the
\ncontext\t of  government servants in  Railway.  The  majority
\njudgment  did  not express opinion on the  question  of\t the
\nRailway rule being bad on the ground of unguided and uncana-
\nlised  power.  In his judgment, Mr. Justice Das\t Gupta\theld
\nthat the rule gave no guidance and was, therefore, violative
\nof  Article 14. (See page 769 of the report). On this  point
\nMr. Justice Shah, as the learned Chief Justice then was,  in
\nhis  judgment  observed\t at page 799-800  of  the  aforesaid
\nreport:\n<\/p>\n
“In considering the validity of an order an assumption\tthat
\nthe power may be exercised mala fide and on that ground
\n192<\/span>
\ndiscrimination\tmay  be practised is wholly  out  of  place.
\nBecause\t of the absence of specific directions in  Rule\t 148
\ngoverning  the exercise of authority conferred thereby,\t the
\npower  to  terminate  employment cannot be  regarded  as  an
\narbitrary power exercisable at the sweet will of the author-
\nity, when having regard to the nature of the employment\t and
\nthe service to be rendered, the importance of the  efficient
\nfunctioning  of\t the  rail transport in the  scheme  of\t our
\npublic\teconomy,  and the status of the\t authority  invested
\nwith the exercise of power would appropriately be  exercised
\nfor the protection of public interest on grounds of adminis-
\ntrative\t convenience.  Power to exercise discretion  is\t not
\nnecessarily  to be assumed to be a power which will  invali-
\ndate the conferment of power. Conferment of power has neces-
\nsarily to be coupled with the duty to exercise it bona\tfide
\nand  for effectuating the purpose and policy underlying\t the
\nrules which provide for the exercise of the power. If in the
\nscheme\tof the rule, a clear policy relating to the  circum-
\nstances\t in which the power is to be exercised is  discerni-
\nble, the conferment of power must be regarded as being\tmade
\nin  furtherance of the scheme, and is not open to attack  as
\ninfringing  the’ equality clause. It may be remembered\tthat
\nthe rules relating to termination of employment of temporary
\nservants and those on probation, and even those relating  to
\ncompulsory retirement generally do not lay down any specific
\ndirections  governing the exercise of the  powers  conferred
\nthereby.  The  reason is obvious: the  appointing  authority
\nmust in all these cases be left with discretion to determine
\nemployment  having regard to the exigencies of the  service,
\nsuitability of the employee for absorption or continuance in
\nthe  cadre,  and the larger. interest of  the  public  being
\nserved\t by  retaining\tthe  public  servant  concerned\t  in
\nservice.”\n<\/p>\n
    Learned Solicitor General submitted that the question is
\nwhether\t it is the very existence of power which is  bad  or
\nthe  exercise is bad in any specific case. It was  submitted
\nthat the Court would be entitled to obtain guidance from the
\npreamble,  the\tpolicy and the purpose of the  Act  and\t the
\npower conferred under it and to see that the power is  exer-
\ncised only for that purpose. It was submitted that even if a
\nstatute makes no clarification Court would ascertain if\t the
\nstatute\t laid down any principle or policy. In such a  case,
\nthe statute will be upheld although a given exercise may  be
\nstruck down in particular cases. See
\n193<\/span>
\nthe observations of this Court in Shri Ram Krishna Dalmia v.
\nJustice\t Tandolkar, [1959] SCR 279 at 299. The\tguidance  in
\nthe statute for the exercise of discretion may be found from
\nthe preamble read in the light of surrounding  circumstances
\nor  even from the policy or the purpose of the enactment  or
\ngenerally  from\t the object sought to be achieved.  See\t the
\nobservations  of this Court in Jyoti Prasad v. The  Adminis-
\ntrator for the Union Territory of Delhi, [1962] 2 SCR 125 at\n<\/p>\n
139.  Even a term like ‘public interest’ can  be  sufficient
\nguidance in the matter of retirement of a government employ-
\nee. See the observations of this Court in Union of India  v.
\nCol.  J.N. Sinha & Anr.,<\/a> [1970] 2 SCC 458 at 461 and such  a
\nprovision  can\tbe read into a statute even when it  is\t not
\notherwise  expressly there. Learned Solicitor  General\tdraw
\nour  attention\tto the observations of this  Court  in\tN.C.
\nDalwadi\t v. State of Gujarat,<\/a> [1987] 3 SCC 611 paragraphs  9
\nand  10\t at  page 619. It is well settled  and\tthe  learned
\nSolicitor  General  made a point of it that the\t Court\twill
\nsustain the presumption of constitutionality by\t considering
\nmatters\t of  common knowledge and to assume every  state  of
\nfacts  which  can be conceived and can even  read  down\t the
\nsection, it was submitted, if it becomes necessary to uphold
\nthe  validity of the provision. Reliance was placed  on\t the
\ndecision  of this Court in Commissioner of Sales Tax,  M.P.,
\nIndore\t& Ors. v. Radhakrishan & Ors.,<\/a> [1979] 2 SCC  249  at\n<\/p>\n
257.
\n    In the case of Olga Tellis & Ors. etc. v. Bombay Munici-
\npal  Corporation & Ors., [1985] Suppl. 2 SCR 51 at  89\tthis
\nCourt  has  held that considering the scheme of the  act,  a
\nsection\t which enabled the Commissioner to remove  encroach-
\nment  without notice must be read to mean that notice  would
\nbe  given unless circumstances are such that it is not\trea-
\nsonably practicable to give it. This Court further held that
\nthe discretion is to be exercised in a reasonable manner  so
\nas to comply with the constitutional mandate that the proce-
\ndure  accompanying the performance of a public act  must  be
\nfair  and reasonable. We must lean in favour of that  inter-
\npretation  because it helps to sustain the validity  of\t the
\nlaw.\n<\/p>\n
    Learned  Solicitor\tGeneral submitted  that\t the  appeal
\ninvolved herein the power of Delhi Transport Corporation  (a
\nstatutory  corporation)\t regarding  termination\t of  service
\nsimpliciter  under Regulation 9(b). These  Regulations\twere
\nframed\tas  mentioned  under Section 53 of  the\t Delhi\tRoad
\nTransport Authority Act, 1950. The said Act was replaced  by
\nthe  Delhi Municipal Corporation Act, 1957 but\tthe  regula-
\ntions have been saved and even though in 1971 a new Corpora-
\ntion, viz. the Delhi Transport Corporation (the\t appellant),
\nwas constituted
\n194<\/span>
\nunder the Road Transport Corporation Act, 1950, the  regula-
\ntions have been continued.\n<\/p>\n
    The guidelines for the exercise of such power, according
\nto  the Solicitor General, could be found in  the  statutory
\nprovisions of the 1950 Act under which the regulations\thave
\nbeen framed, the preamble; Sections 19 and 20 (equivalent to
\nSections  18 and 19 of the Road Transport  Corporation\tAct,
\n1950);\tSection 53 (equivalent to 45 of the  Road  Transport
\nCorporation Act, 1950); the context of Regulation 9(b)\tread
\nwith  9(a)  and\t 15. Even for the exercise  of\tthis  power,
\nreasons could be recorded although they need not be communi-
\ncated. This will ensure according to the Solicitor  General,
\na  check  on the arbitrary exercise of power  and  effective
\njudicial review in a given case. The present regulations are
\nparallel,  to but not identical with, the exceptions  carved
\nout under Article 311(2) proviso. It was submitted that even
\nthe  power of termination simpliciter under Regulation\t9(b)
\ncan  only be exercised in circumstances other than those  in
\nRegulation 9(a), i.e., not where the foundation of the order
\nis ‘misconduct’. The exercise of such power can only be\t for
\npurposes germane and relevant to the statute. It was submit-
\nted  by the learned Solicitor General that these  would\t in-
\nclude  several cases which have been held by Courts to\tgive
\nrise to termination simpliciter including where the employee
\nshows  such  incompetence or unsuitability as  to  make\t his
\ncontinuance in employment detrimental in the interest of the
\nCorporation,  where  the continuance of the  employee  is  a
\ngrave  security risk making his continuance  detrimental  in
\nthe  interest of the Corporation, if there is a\t justifiable
\nlack of confidence which makes it necessary in the  interest
\nof  the Corporation to immediately terminate  the  services.
\nThese are illustrative and not exhaustive.
\n    It\twas submitted by the learned Solicitor General\tthat
\nthe  above  guidelines of recording  reasons  and  confining
\naction under Regulation 9(b) for purposes germane and  rele-
\nvant  to the statute would prevent arbitrary action  by\t the
\nCorporation while enabling it to run its services efficient-
\nly  and in public interest. Thus, there is no vice of  arbi-
\ntrariness in the regulation. The judgment of the High Court,
\ntherefore, cannot and should not be upheld according to\t the
\nlearned Solicitor General.\n<\/p>\n
    In\tCivil Appeal No. 2876 of 1986, the learned  Attorney
\nGeneral\t urged that the settled rule judicially\t evolved  in
\nmatters\t of constitutional adjudication is that in order  to
\nsustain the constitutionality of legislation, the words of a
\nstatute\t may be qualified, its operation limited and  condi-
\ntions, limitations and obligations may be implied or
\n195<\/span>
\nread into the statute in order to make it conform to consti-
\ntutional  requirements. The underlying rationale,  according
\nto the learned Attorney General, of this rule of interpreta-
\ntion,  or the doctrine of reading down of a statute is\tthat
\nwhen a legislature, whose powers are not unlimited, enacts a
\nstatute, it is aware of its limitations, and in the  absence
\nof  express intention or clear language to the contrary,  it
\nmust be presumed to have implied into the statute the requi-
\nsite  limitations  and conditions to immunise  it  from\t the
\nvirus of unconstitutionality. From what the learned Attorney
\nGeneral\t submitted and what appears to be the  correct\tthat
\nevery  legislature intends to act within its powers.  There-
\nfore,  in a limited Government, the legislature attempts  to
\nfunction within its limited powers. It would not, therefore,
\nbe expected to have intended to transgress its limits. In Re
\nThe Hindu Women’s Rights to Property Act, [1941] FCR 12, the
\nquestion  before the Federal Court was about the meaning  of
\nthe word ‘property’ in the Act. The Court limited the opera-
\ntion of the word ‘property’ to property other than  agricul-
\ntural  land because otherwise the Central Legislature  would
\nhave  had  no  competence to enact the\tstatute.  The  Court
\nobserved at pages 26 and 27 of the Report as follows:
\n“No  doubt if the Act does affect agricultural land  in\t the
\nGovernors’  Provinces, it was beyond the competence  of\t the
\nLegislature to enact it: and whether or not it does so\tmuch
\ndepend\tupon  the meaning which is to be given to  the\tword
\n‘property’ in the Act. If that word necessarily and inevita-
\nbly comprises all forms of property, including\tagricultural
\nland,  then  clearly the Act went beyond the powers  of\t the
\nLegislature;  but  when a Legislature with limited  and\t re-
\nstricted powers makes use of a word of such wide and general
\nimport,\t the presumption must surely be that it is using  it
\nwith  reference\t to that kind of property  with\t respect  to
\nwhich  it  is competent to legislate and to  no\t other.\t The
\nquestion is thus one of construction, and unless the Act  is
\nto  be regarded as wholly meaningless and  ineffective,\t the
\nCourt is bound to construe the word ‘property’ as  referring
\nonly  to those forms of property with respect to  which\t the
\nLegislature  which enacted the Act was competent  to  legis-
\nlate;  that is to say, the property other than\tagricultural
\nland  ……  ”\n<\/p>\n
    See\t also  the observations of Chief  Justice  Gwyer  at
\npages 27 to 29 of the Report on how legislations of legisla-
\nture  with limited powers should be construed. See also\t the
\nobservations of this Court in R.M.D.\n<\/p>\n
196<\/span><\/p>\n
Chamarbaugwalla v. Union of India, [1957] SCR 930, at p. 935
\nand 938. There section 2(d) of Prize Competitions Act,\t1955
\ndefined\t ‘prize competition’ as meaning any  competition  in
\nwhich prizes are offered for the solution of any puzzle.  As
\ndefined,  the statute covered not only competition in  which
\nsuccess\t depended  on chance but also those  which  involved
\nsubstantial  degree of skill. It was conceded that  the\t Act
\nwould  be violative of Article 19(1)(g) of the\tConstitution
\nif  competitions which involved substantial degree of  skill
\nwere included in the statutory definition. See the  observa-
\ntions  of  this Court at p. 935 of the\treport.\t This  Court
\nrejected the argument of the petitioners therein that  since
\nthe language of the definition of prize competition was wide
\nand  unqualified, it was not open to the Court to read\tinto
\nit  a  limitation which was not there.\tThis  principle\t was
\nreiterated  and applied by this Court in the case  of  Kedar
\nNath Singh v. State of Bihar, [1962] Supp. (2) SCR 769.\t The
\nquestion before this Court was about the validity of s. 124A
\nof the Indian Penal Code. This Court in order to sustain the
\nvalidity  of  the  section on  the  touch-stone\t of  Article
\n19(1)(a) of the Constitution of India, limited its  applica-
\ntion only to acts involving intention or tendency to  create
\ndisorder, or disturbance of law and order, or incitement  to
\nviolence.  This Court held that it was well settled that  if
\ncertain\t provisions of law construed in one way\t would\tmake
\nthem consistent with the Constitution, and another interpre-
\ntation\twould render them unconstitutional, the Court  would
\nlean in favour of the former construction. The provisions of
\nthe  sections read as a whole, along with the  explanations,
\nmake it reasonably clear that the sections aim at  rendering
\npenal  only such activities as would be intended, or have  a
\ntendency, to create disorder or disturbance of public  peace
\nby resort to violence.\n<\/p>\n
    Reference may also be made to the decision of this Court
\nin  R.L. Arora v. State of Uttar Pradesh,<\/a> [1964] 6  SCR\t 784
\nwhere  the question was about the Constitutionality of\tsec-
\ntion  41(aa) of the Land Acquisition (Amendment) Act,  1962.
\nThis Court upheld the validity of the section following\t the
\nprinciple of interpreting the said rule in a way which would
\nbe consistent with the Constitution. See the observations of
\nthis Court at p. 797 of the said report.\n<\/p>\n
    The technique of reading down has been adopted in numer-
\nous  cases  to sustain the validity of\tthe  provision.\t For
\nexample, in Jagdish Pandey v. The Chancellor, University  of
\nBihar & Anr.,<\/a> [1968] 1 SCR 23 1, at pages 236-37, this Court
\nmade  resort  to section 4 of the Bihar\t State\tUniversities
\nAct, 1962. It was observed that section 4 so read  literally
\nit  did appear to give uncanalised powers to the  Chancellor
\nto
\n197<\/span>
\ndo  what  he liked on the recommendation of  the  Commission
\nwith  respect to teachers covered by it. But this Court\t was
\nof  the opinion that the legislature did not intend to\tgive
\nsuch  an  arbitrary power to the Chancellor and was  of\t the
\nopinion\t that  s. 4 should be read down and if\tit  is\tread
\ndown,  there was no reason to hold that the legislature\t was
\nconferring  a  naked arbitrary power on the  Chancellor\t and
\nthat  power cannot be struck down ,as  discriminatory  under
\nArticle 14 of the Constitution. See the observations of this
\nCourt in Sunil Batra v. Delhi Administration & Ors.,<\/a>  [1978]
\n4 SCC 494. There the constitutionality of s. 30, sub-section
\n(2) and section 56 of the Prisons Act, 1894 was in question.
\nKrishna Iyer, J, speaking for this Court at p. 511, para 34,
\nof the report observed that the Court does not ‘rush in’  to
\ndemolish provisions where judicial endeavour, amelioratively
\ninterpretational,  may\tachieve both  constitutionality\t and
\ncompassionate  resurrection.  This  salutary  strategy,\t the
\nlearned\t Judge observed, of sustaining the validity  of\t the
\nlaw  and softening its application was of lovely  dexterity.
\nThe  semantic  technique of updating the living sense  of  a
\ndated  legislation  is, in our view,  perfectly\t legitimate.
\nSemantic  readjustments are necessary to obviate  alegicidal
\nsequel\tand a validation-oriented approach becomes the\tphi-
\nlosophy of statutory construction sometimes. Similar  obser-
\nvations\t were  made  in N.C. Dalwadi v.\t State\tof  Gujarat,<\/a>
\n(supra).  In Tinsukhia Electric Supply Co. Ltd. v. State  of
\nAssam & Ors.,<\/a> [1989] 3 SCC 709, this Court upheld the valid-
\nity  of sections 9 and 10 of the Act by reading\t in  several
\nmatters\t by  necessary implication in order to\tsustain\t the
\nvalidity of the sections. In Charan Lal Sahu & Ors. v. Union
\nof  India,<\/a> [1989] Supp. SCALE 1, at pages 53 and  54,  paras
\n101  as well as p. 61, para 114, it was observed  that\tthis
\nprinciple  of reading down has been adopted in U.S.  Supreme
\nCourt in several cases. See also United States of America v.
\nEdward A. Rumely, 97 Lawyers Edition 770 at 775. The princi-
\nple as enunciated in Rumely’s case (supra) has been approved
\nby this Court in Shah & Co. v. State of Maharashtra,  [1967]
\n3  SCR\t466  at 477-78. This principle of  reading  down  or
\nplacing\t limited construction has been adopted by courts  in
\nEngland\t in  deciding the validity of bye-laws\tand  regula-
\ntions.\tSee Reg. v. Sadlers Co., 10 H.L.C. 404, at  460\t and
\n463 and Faramus v. Film Artists Association, 1962 QB 527  at\n<\/p>\n
542.  The  courts must iron out the creases,  as  said\tLord
\nDenning\t in  Seaford Court Estates, [1949] 2  KB  481.\tThis
\nCourt has also on numerous occasions followed this practice.
\nSee the observations of this Court in M. Pentiah and Ors. v.
\nVeera  Mallappa and Ors., [1961] 2 SCR 295; Bangalore  Water
\nSupply and Sewerage Board etc. v. A. Rajappa & Ors.,  [1978]
\n3  SCR 207. See also H.M. Seervai’s ‘Constitutional  Law  of
\nIndia’, 3rd Edn. Vol. I, pages 119-120. In the background of
\nthis, the learned Attorney General also
\n198<\/span>
\ndrew our attention that the present regulation, as mentioned
\nhereinbefore,  should  be  read and construed  in  the\tsaid
\nmanner and the reasons and conditions of its exercise can be
\nspelt  out and it may be so construed. He submitted that  it
\nshould be spelt out that the regulation requires reasons  to
\nbe there, reasons which are germane and relevant.
\n    The\t principles  of\t natural justice or  holding  of  an
\nenquiry\t is  neither a universal principle  of\tjustice\t nor
\ninflexible dogma. The principles of natural justice are\t not
\nincapable  of exclusion in a given situation.  For  example,
\nArticle\t 311(2)\t of the Constitution which  essentially\t em-
\nbodies\tthe concept of natural justice, itself\tcontemplates
\nthat  there  may be situations which warrant or\t permit\t the
\nnon-applicability  of  the  principles\tunderlying   Article
\n311(2)\tof  the Constitution. Reference may be made  to\t the
\nsecond\tproviso\t to Article 311 of  the\t Constitution.\tThis
\ncourt  has  also recognised that the rule  of  audi  alteram
\npartera can be excluded where having regard to the nature of
\nthe  action  to\t be taken, its object and  purpose  and\t the
\nscheme\tof  the relevant statutory  provision,\tfairness  in
\naction does not demand its application and even warrants its
\nexclusion. If importing the right to be heard has the effect
\nof  paral.Vsing the administrative process or the  need\t for
\npromptitude  or\t the urgency of the  situation\tso  demands,
\nnatural\t justice could be avoided. See the  observations  of
\nthis  Court in Maneka Gandhi’s case at p. 681 of the  report
\n(supra). This Court in Tulsi Ram Patel’s case (supra) had in
\nterms ruled that not only, therefore, can the principles  of
\nnatural\t justice be modified but in exceptional\t cases\tthey
\ncan even be excluded. But the principles of natural  justice
\nmust not be displaced save in exceptional cases. Consequent-
\nly,  the learned Attorney General submitted that  the  words
\n“where it is not reasonably practicable to hold an  enquiry”
\nmay  be imported into the regulations. It was  submitted  by
\nthe  learned  Attorney General that the\t exclusion  of\taudi
\nalteram\t partera  rule in circumstances\t which\tare  circum-
\nscribed\t and  coupled  with the safeguard  of  recording  of
\nreasons\t which are germane and relevant, the termination  in
\nsuch a situation would not render the regulation  unreasona-
\nble  or arbitrary. Then it could not be said that the  power
\nwas  uncanalised or unguided if the regulation is  construed
\nand  read down in the manner indicated above,  according  to
\nthe learned Attorney General. The reading down, the  learned
\nAttorney  General  conceded cannot, however, be\t done  where
\nthere was no valid reason and where it would be contrary  to
\nproclaimed  purpose. See the observations of this  Court  in
\nMinerva Mills Ltd. & Ors. v. Union of India & Ors.,<\/a> [1981] 1
\nSCR 206, at p. 239 and 259.\n<\/p>\n
On behalf of the workmen of the respondent DTC, Shri
\n199<\/span>
\nRamamurthi,  submitted that the Constitutional questions  of
\ngreat public importance arising in the present appeal,\thave
\nto be examined in the light of the law laid down by the Full
\nCourt in the case of R.C. Cooper v. Union of India,<\/a> [1970] 3
\nSCR  530  at 577 and by larger Constitution Benches  in\t the
\ncases  of Maneka Gandhi v. Union of India<\/a> (supra), Moti\t Ram
\nDeka  v.  Union of India (supra), State of  West  Bengal  v.
\nUnion of India,<\/a> (supra) and the Constitution Bench decisions
\nin  the cases of Olga Tellis and Others v. Bombay  Municipal
\nCorporation  and  Others,<\/a>  (supra),  Fertilizer\t Corporation
\nKamgar Union (Regd.) Sindri and Others v. Union of India and
\nOthers,<\/a>\t [1981] 2 SCR at 60-61, Union of India\tv.  Tulsiram
\nPatel  and Others<\/a> (supra), Sukhdev Singh & Others v.  Bhagat
\nRam  Sardar Singh Raghuvanshi and Another<\/a> (supra)  and\tAjay
\nHasia etc. v. Khalid Mujib Sehravardi & Ors. etc., [1981]  2
\nSCR 79 at 100-102. According to Shri Ramamurthi these  deci-
\nsions are authority for the following propositions:\n<\/p>\n
       (a)  The declarations in the provisions contained  in
\nthe Fundamental Rights Chapter involve an obligation imposed
\nnot merely upon the “State” but upon all persons to  respect
\nthe rights declared, unless the context indicates otherwise,
\nagainst every person or agency seeking to infringe them. See
\nthe  observations of this Court in State of West  Bengal  v.
\nUnion of India,<\/a> [1964] 1 SCR 371 at page 438:\n<\/p>\n
       (b) Part III of the Constitution weaves a pattern  of
\nguarantee on the texture of basic human rights. The  guaran-
\ntees delimit the protection of those rights in their  allot-
\nted field. They do not attempt to enunciate distinct  right.
\n[See  R.C. Cooper’s case (supra( at p. 577 of  the  report].
\nThe extent of protection against impairment of a fundamental
\nright is determined not by the object of the Legislature nor
\n2by the form of the action, but by its direct operation upon
\nthe individual’s rights.\n<\/p>\n
       (c) Any person who is deprived of his right to  live-
\nlihood\texcept according to just and fair  procedure  estab-
\nlished by law can challenge the deprivation as offending the
\nright to life, conferred by Article 21. See the observations
\nof this Court in Olga Tellis’s case (supra( at 80-81 and  85
\nof  the\t report. Therefore, the holding to the\tcontrary  in
\nA.V.  Nachane & Anr. v. Union of India & Anr.,<\/a> [1982] 2\t SCR
\n246 is no longer good law.\n<\/p>\n
     In\t any  event Counsel is right that  the\tobservations
\nmade  at  p. 259 of the report (supra) were in\ta  different
\ncontext and the challenge
\n200<\/span>
\nbased  on Articles 19(1)(g) and 31 does not appear  to\thave
\nany  substance in resolving the present\t controversy  before
\nus. Mr. Ramamurthi submitted that provision of any Rule that
\nservice\t shall\tbe liable to termination on notice  for\t the
\nperiod\tprescribed  therein contravenes Article\t 14  of\t the
\nConstitution as arbitrary and uncontrolled power is left  in
\nthe authority to select at its will any person against\twhom
\naction will be taken. See the observations of this Court  in
\nMoti  Ram Deka’s case (supra) at p. 770 and 751 of  the\t re-
\nport.\n<\/p>\n
    It\twas  submitted that Articles 14, 19 and\t 21  of\t the
\nConstitution are inter-related and the law must,  therefore,
\nnow  be\t taken to be well settled that Article 21  does\t not
\nexclude\t Article 19 and even if there is a law\tproviding  a
\nprocedure  for depriving a person of personal liberty  (this
\nwill  equally apply to life) and there is, consequently,  no
\ninfringement  of fundamental right conferred by Article\t 21,
\nsuch  law in so far as it abridges or takes away any  funda-
\nmental\tright under Article 19 would have to meet the  chal-
\nlenge of the Article. See the observations of this Court  in
\nManeka\tGandhi’s  case\t(supra). Article  19(1)(g),  it\t was
\nurged, confers a broad and general right which is  available
\nto  all\t persons to do work of any particular  kind  and  of
\ntheir choice. See the observations in Fertilizer Corporation
\nKamgar Union’s case (supra) at p. 60-61 of the report.
\n    According  to  Mr. Ramamurthi, there  is  a\t distinction
\nbetween\t Public Employment or service and “pure\t master\t and
\nservant\t cases”.  He referred to the  observations  of\tthis
\nCourt in India Tobacco Co. Ltd. v. The Commercial Tax  Offi-<\/a>
\ncer,  Bhavanipore & Ors., [1975] 2 SCR 619 at 657;  followed
\nin  A.L. Kalra v. The Project and Equipment  Corporation  of
\nIndia  Ltd.,<\/a> [1984] 3 SCR 646 at 664;  Whenever,  therefore,
\naccording  to  Shri Ramamurthi, there  is  arbitrariness  in
\nState  Action  whether it be of the Legislature\t or  of\t the
\nExecutive  or of an authority under Article 12,\t article  14
\nimmediately springs into action and strikes down such  State
\naction.\t  In  fact,  the  concept  of\treasonableness\t and
\nnon\/arbitrariness pervades the entire constitutional  scheme
\nand  is a golden thread which runs through the whole of\t the
\nfabric\tof  the Constitution. See the observations  of\tthis
\nCourt  in  Bandhua Mukti Morcha v. Union of  India  &  Ors.,<\/a>
\n[1984] 2 SCR 79 at 101. A violation of a principle of  natu-
\nral justice by State action is a violation of Article 14  of
\nthe Constitution, which can be excluded only in\t exceptional
\ncircumstances.\tSee the observations of this Court in  Tulsi
\nRam Patel’s case (supra) at 229, and at 233 of the report.
\nIt was, therefore, submitted that a clause authorising the
\n?201
\nemployer  to  terminate the services of\t an  employee  whose
\ncontract of service is for an indefinite period or till\t the
\nage of retirement, by serving notice violates the  fundamen-
\ntal rights guaranteed under Articles 14, 19(1) (g) and 21 of
\nthe  Constitution for Article 21 is violated when  right  to
\nlivelihood  is\ttaken away by termination of  service  of  a
\nperson; employed for an indefinite period or till the age of
\nretirement  except for proved misconduct. Assuming,  it\t was
\nargued, that in such a case right to livelihood can be taken
\naway by termination of service by giving notice, nonetheless
\nit could be validly done only, according to Shri Ramamurthi,
\nif:\n<\/p>\n
       (i) There is a fair and just procedure by way of–(1)
\nrecording of reasons and (2) notice to show cause;\n<\/p>\n
       (ii)  And  the right to terminate  is  restricted  to
\nexceptional grounds.\n<\/p>\n
    When the service of a person employed for an  indefinite
\nperiod\tor  till the age of retirement is  terminated,\tShri
\nRamamurthi assets, then Article 14 is violated when there is
\nno  guidance for the exercise of power and reasons  are\t not
\nrequired  to be recorded and principles of  natural  justice
\nare abrogated. Similarly Article 19(1)(g) is violated,
\naccording to him, for the reasons that there is no guidance,
\nno requirement of reasons to be recorded and there is viola-
\ntion of the principles of natural justice.\n<\/p>\n
     Shri  Ramamurthi reminded us that before  India  became
\nindependent  in 1947, the Indian Contract Act 1872  was\t ap-
\nplicable  only to British India on its own force. By  Merged
\nState  Laws Act, 1949 it was extended to the  new  provinces
\nand  merged  States  to the States of  Manipur,\t Tripura  by
\nVindhya\t Pradesh by Union territories Law Act 1950.  It\t was
\nalso  extended to the States merged in the States of  Bombay
\nand Punjab by Bombay Act 4 of 1950 and Punjab Act 5 of 1950.
\nWith  the promulgation of the Constitution, the Indian\tCon-
\ntract  Act  1872 extends to the whole of  India\t except\t the
\nState of Jammu & Kashmir. Shri Ramamurthi asserted the what-
\never might have been the position in regard to the provinces
\ncomprised  in British India before independence, as  far  as
\nother  areas, forming part of the Union of India  under\t the
\nConstitution  are  concerned, only the Indian  Contract\t Act
\n1872 is applicable. By article 372 of the Constitution, this
\nAct has been continued in operation even after the Constitu-
\ntion came into force, subject to the other provisions of the
\nConstitution.\n<\/p>\n
202<\/span><\/p>\n
    A contract of service, according to Shri Ramamurthi is a
\nspecies of contract and will, therefore, be governed by\t the
\nprovisions  of\tthe Indian Contract Act 1872. This  Act\t has
\nbeen held to be an Amending as well as a Consolidating\tAct.
\nTherefore,  there can be no question of common law  of\tEng-
\nland,  as made applicable in India during the British  Rule,
\nbeing  the basis for deciding any question relating to\tcon-
\ntract of employment after 1950. In any event any  provisions
\nof  either the Indian Contract Act, 1872, or of the  English
\nCommon Law Applicable in British India before the  Constitu-
\ntion  came into force would be void by reason of Article  13
\nof  the Constitution if it infringed any of the\t fundamental
\nrights\tcontained in Part III of the  Constitution,  pleaded
\nMr.  Ramamurthi before us. Under Section 2(h) of the  Indian
\nContract  Act, 1872 an agreement (including an agreement  of
\nservice)  becomes a contract only when it is enforceable  by
\nlaw.  If it is not enforceable in law, it would be  void  by
\nreason of section 2(g) of the Contract Act. The question for
\nconsideration  would, therefore, be whether a clause  in  an
\nagreement of service when it is for an indefinite period  or
\ntill  the  age of retirement providing\tfor  termination  by
\ngiving notice would be enforceable? It was submitted by\t the
\nworkers’  union that it would not be enforceable if it\tvio-
\nlates  the  fundamental rights guaranteed  by  Articles\t 14,
\n19(1)(g) and 21 of the Constitution. See the observations of
\nthis  Court  in Moti Ram Deka’s case (supra) at 709  of\t the
\nReport.\t It  was submitted that the broader  submission\t was
\nthat  under  our Constitution there can be  no\tcontract  of
\nemployment  providing for termination of service by  an\t em-
\nployer of an employee by giving notice, when the  employment
\nis  for indefinite period or till the age of retirement.  In
\nany  event, such a clause cannot find a place either in\t the
\ncontract of service or in the statutory provisions governing
\nthe  conditions of service in the case of public  employment
\nunder the ‘state’ as defined in Article 12 of the  Constitu-
\ntion.\n<\/p>\n
    Shri Ramamurthi urged that the observations contained in
\nthe judgment of this Court in Tulsiram Patel’s case  (supra)
\nat  166 of the report, regarding the ordinary law of  master
\nand servant cannot be construed as laying down the  proposi-
\ntion that under the Indian law, even if a contract of  serv-
\nice  is for an indefinite period or till the age of  retire-
\nment, it can still be terminated by giving reasonable period
\nof notice. In any event, even in the Common Law of  England,
\na  distinction is made between public employment  and  “pure
\nmaster\tand  servant cases” [See the  observations  of\tthis
\nCourt  in  Sukhdev Singh’s case (supra) at page 657  of\t the
\nreport.\n<\/p>\n
Mr. Ramamurthi submitted that the doctrine of pleasure
\n203<\/span>
\nadvanced  by  the  learned Solicitor General  of  India\t was
\nconfined  to employment under the Union of India and  States
\ndealt with under Part XIV, Chapter I of the Constitution and
\ncannot and do not extend to employment under local or  other
\nauthorities  referred to under Article 12 of  the  Constitu-
\ntion.  There  cannot be any pleasure by\t such  authority  in
\nrespect\t of  employment of the permanent  employee.  It\t was
\nsubmitted  by Shri Ramamurthi further that even in cases  of
\nemployment  under  the Union and the  States,  the  pleasure
\ndoctrine is limited by the express provisions of Article 311
\nof  the Constitution. For that reason, according to him,  it
\nhas  lost some of its majesty and power. He referred  us  to
\nthe  observations  of  this Court in Moti  Ram\tDeka’s\tcase
\n(supra)\t at  p. 704 and Tulsi Ram Patels’s case\t (supra)  at
\npage 196.\n<\/p>\n
    In dealing with the question of validity of rules autho-
\nrising the Government to terminate the services of temporary
\nservants  as  upheld by this court in  Champaklal  Chimanlal
\nShah’s case (supra) and Ram Gopal Chaturvedi’s case  (supra)
\nit  was\t submitted  that it is important to  note  that\t the
\nvalidity of the rules was challenged on the ground of denial
\nof  equality  of opportunity in employment under  the  State
\nguaranteed  by Article 16 of the Constitution. In that\tcon-
\ntext  this Court observed at p. 20 1 (supra) of\t the  report
\nthat  there can also be no doubt, if such a class of  tempo-
\nrary  servants\tcould be recruited, there could\t be  nothing
\ndiscriminatory\tor  violative of equal\topportunity  if\t the
\nconditions  of service of such servants are  different\tfrom
\nthose of permanent employees. It is thus apparent that\tthis
\nCourt,\tit  was submitted, had no occasion to  consider\t the
\nreasonableness of a provision for termination of service  on
\ngiving\tnotice\tunder Article 14 of  the  Constitution\tand,
\ntherefore,  this  decision can be of no\t assistance  to\t the
\nappellants.  Shri  Ramamurthi  submitted  that\tsince,\taudi
\nalteram\t partem is a requirement of Article 14, in  view  of
\nrecent decisions of this Court, and conferment of  arbitrary
\npower itself is contrary to Article 14, the rule in question
\ncan, according to Shri Ramamurthi, no larger be sustained as
\nvalid.\n<\/p>\n
    As\tfar as the decision in Ram Gopal  Chaturvedi’s\tcase
\n(supra)\t was concerned, Shri Ramamurthi submitted  that\t the
\nreasons\t given\tfor  rejecting the argument  that  the\trule
\nconfers an arbitrary and unguided power are not valid for in
\nMoti  Ram Deka’ case (supra), where the view of two  learned
\njudges of this Court who had held similar power to be  arbi-
\ntrary had not ever been noticed. The observation that it  is
\nimpossible  to define before hand all the  circumstances  in
\nwhich the discretion can be exercised and the discretion had
\nnecessarily to be left to the Government, has not taken into
\nconsideration the circumstance
\n204<\/span>
\nthat  the denial of audi alteram parlem which is a  require-
\nment of Article 14, can be only in exceptional circumstances
\nand,  therefore, such circumstances have necessarily  to  be
\nspelt  out.  This Court had no occasion, according  to\tShri
\nRamamurthi, to consider the cumulative impact of the  funda-
\nmental\trights guaranteed by Article 14, 19(1)(g) and 21  of
\nthe Constitution.\n<\/p>\n
    Shri Ramamurthi sought to urge before us that industrial
\nlaw  recognises the right of the employer to exercise,\tbona
\nfide,  the  power to terminate the services  of\t workman  by
\ngiving notice, except in case of misconduct, which is unlike
\nthe law of master and servant. Shri Ramamurthi urged that it
\nis important to note that in all cases under industrial law,
\ndecisions  have\t been rendered by industrial  tribunal\twhen
\ndisputes  had been raised by workmen challenging the  action
\nof the employer terminating their services by giving notice,
\nunder the terms of the contract of service or the  Certified
\nStanding Orders. The question was never raised, nor could it
\nbe  raised, before the Tribunals that the very term  in\t the
\ncontract  of  service or in Standing Orders  would  have  to
\nstand  the test of Articles 14, 19(1)(g) and 21 of the\tCon-
\nstitution.  Further a constitution bench of this  Court\t had
\nrejected  the  contention that Industrial  Tribunals  should
\nmake a distinction between public sector and private  sector
\nindustries. Reliance was placed on the observations of\tthis
\nCourt  in Hindustan Antibiotics Ltd. v. The Workmen &  Ors.,<\/a>
\n[1987]\t1 SCR 652 at 669. On the consideration of the  rele-
\nvant material placed before us, we are asked to come to\t the
\nconclusion  that the same principles evolved  by  industrial
\nadjudication  in regard to private sector undertakings\twill
\ngovern\tthose  in the public sector  undertakings  having  a
\ndistinct  corporate existence. Therefore, all the  decisions
\nreferred  to by the appellant, it was argued, and  interven-
\ners,  were  all concerned with applying the  industrial\t law
\neven  though some Of them dealt with employees,\t working  in
\nstatutory  corporations\t or public sector  undertakings.  It
\nwas,  therefore,  submitted by Shri  Ramamurthi\t that  these
\ndecisions could afford no assistance to the Court, in decid-
\ning the issues raised in the present case, where the validi-
\nty  of\ta  term of employment, permitting  the\temployer  to
\nterminate  the\tservices of a permanent employee  by  simply
\ngiving notice, is challenged on the ground that such a\tterm
\nviolates  fundamental  rights  guaranteed  by  Articles\t 14,
\n19(1)(g)  and 21 of the Constitution. It was submitted\tfur-
\nther  that the constitutional guarantees under\tArticles  14
\nand 21 of the Constitution are for all persons and there can
\nbe  no basis for making a distinction between  ‘workmen’  to
\nwhom  the Industrial Disputes Act and other industrial\tlaws
\napply  and  those who are outside their\t purview.  The\tlaws
\napplicable to the former
\n205<\/span>
\ncan  only add to and not detract from the rights  guaranteed
\nby Part III of the Constitution.\n<\/p>\n
    It\twas important to note that all the decisions so\t far
\nrendered  by this Court striking down rules and\t regulations
\nor  a  provision  in the contract  of  service,\t authorising
\ntermination  of\t service of permanent  employees  by  giving
\nnotice\trelate to cases of non-workman and we were  referred
\nto  the decisions in West Bengal State\tElectricity  Board’s
\ncase  (supra),\tCentral Inland Water  Transport\t Corporation
\nLtd. ‘s case (supra) and O.P. Bhandari’s case (supra). There
\nis  the\t theory\t that possibility of abuse of  power  is  no
\nground for striking down the law. Attention may be drawn  to
\nthe observations of this Court in The Collector of  Customs,
\nMadras v. Nathella Sampathu Chetty,<\/a> [1962] 3 SCR 786 at\t 825
\nand  Commissioner of Sales Tax, Madhya Pradesh v.  Radhakri-
\nshan  & Ors. (supra). However, these decisions, it was\tsub-
\nmitted on behalf of the respondents, would have no relevance
\nfor  the  present case because the power  to  terminate\t the
\nservices of a person employed to serve indefinitely or\ttill
\nthe  age  of retirement can be exercised only  in  cases  of
\nproved misconduct or exceptional circumstances having regard
\nto the Constitutional guarantee available under Articles 14,
\n19(1)(g) and 21 of the Constitution. Unless the\t exceptional
\ncircumstances  are  spelt  out the power  to  terminate\t the
\nservices  would\t cover both  permissible  and  impermissible
\ngrounds rendering it wholly invalid, it was urged. This\t was
\nparticularly  so  because the requirement  of  audi  alteram
\npartem\twhich  is a part of the guarantee of Article  14  is
\nsought to be excluded. There can be no guidance available in
\nthe body of the law itself because the purpose for which  an
\nundertaking  is established and the provisions dealing\twith
\nthe same in the law can provide no guidance regarding excep-
\ntional\tcircumstances  under which alone the  power  can  be
\nexercised.  The\t question involved, Shri  Ramamurthi  empha-
\nsised, in these cases is not the exercise of power which  an
\nemployer possesses to terminate the services of his employee
\nbut the extent of that power.\n<\/p>\n
    Shri  Ramamurthi  drew our attention to  the  award\t and
\nreferred  to  paragraph 5.6 of the Shastri Award  and  other
\nprovisions  of the award defining misconduct and also  para-
\ngraph 522 of the Award dealing with the procedure for termi-
\nnation of employment and 523 onwards. Mr. Ramamurthi further
\nsubmitted  that provisions of Regulation 9(b) of  the  Delhi
\nRoad  Transport\t Authority (Conditions\tof  Appointment\t and
\nService) Regulations, 1952 cannot be rendered constitutional
\nby reading the requirement of recording reasons and  confin-
\ning  it to cases where it is not reasonably  practicable  to
\nhold an enquiry
\n206<\/span>
\nand  reading  it down further as being\tapplicable  to\tonly
\nexceptional cases would not be permissible construction\t and
\nproper.\n<\/p>\n
    Shri Ramamurthi drew our attention to the true scope  of
\nRegulation 9(b) of the aforesaid Regulations in the light of
\nthe  judgment  of  this Court in Balbir\t Saran\tGoel’s\tcase
\n(supra). This rule, it has to be borne in mind, according to
\nhim,  has  been interpreted as applicable to  all  cases  of
\ntermination including termination for misconduct as  defined
\nin the Standing Orders. In the aforesaid decision, at p. 761
\nof the report. this Court observed that:\n<\/p>\n
“Regulation  9(b) clearly provides for termination of  serv-
\nices  in two modes: the first is where the services  may  be
\nterminated without any notice or pay in lieu of notice. This
\ncan  be done among other reasons for misconduct. The  second
\nmode  is of terminating the services owning to reduction  of
\nestablishment or in circumstances other than those mentioned
\nin  clause (a) which relate to termination  without  notice.
\nWhen termination is made under clause (b) one month’s notice
\nor pay in lieu thereof is to be given to the employee.\tThus
\nit  is clear that if the employer chooses to  terminate\t the
\nservices  in  accordance with clause (b)  after\t giving\t one
\nmonth’s\t notice or pay in lieu thereof it cannot  amount  to
\ntermination of service for misconduct within the meaning  of
\nclause (a). It is only when some punishment is inflicted  of
\nthe  nature specified in Regulation 15 for  misconduct\tthat
\nthe procedure laid down therein for an enquiry etc.  becomes
\napplicable.”\n<\/p>\n
    If\tthis  was  the true scope of  the  Regulation,\tShri
\nRamamurthi contended, then it was obvious that it leaves the
\nchoice\tentirely  to the DTC Management\t either\t to  proceed
\nagainst\t the person for misconduct by holding an enquiry  or
\nfor the same misconduct terminate his services by giving one
\nmonth’s\t notice. It is the conferment of such a\t power\tthat
\nhas been held to be unguided and arbitrary in all  decisions
\nfrom  Moti Ram Deka’s case (supra) to the more recent  deci-
\nsions of this Court such as West Bengal Electricity  Board’s
\ncase  (supra),\tetc. Therefore, it was\tsubmitted  that\t the
\nargument  based on the assumption that Regulation  9(b)\t was
\nconfined  to cases under than misconduct  really  overlooked
\nthe  interpretation  placed  upon this\tRegulation  by\tthis
\nCourt.\n<\/p>\n
Shri  Ramamurthi further submitted that if  regulation\t9(b)
\ncon-\n<\/p>\n
207<\/span><\/p>\n
fers  this arbitrary power of leaving it to the DTC  manage-
\nment  to  pick\tand choose then it is plain  that  there  is
\nnothing in the provisions of the Act or the regulations from
\nwhich  the  DTC management can find any\t guidance.  It\twas,
\ntherefore,  the submission of the respondents that in  order
\nto  conform  to the Constitutional guarantees  contained  in
\nArticles  14, 19(1)(g) and 21 of the Constitution as  inter-
\npreted by this Court, the first and foremost the  regulation
\nwill have to make a distinction between cases where services
\nare  sought  to be terminated for misconduct  and  cases  of
\ntermination  on\t grounds other than  what  would  constitute
\nmisconduct. As far as termination or dismissal on ground  of
\nmisconduct  is concerned, ordinarily the detailed  procedure
\nfor  establishing  misconduct had to be followed.  In  cases
\nwhere  it is not possible to follow the detailed  procedure,
\nthen at least the minimum procedure of issuing a show  cause
\nnotice should be followed after recording reasons why it  is
\nnot  practicable  to hold a full-fledged enquiry.  In  cases
\nwhere even this requirement of the elementary principles  of
\nnatural\t justice is not to be followed, then the  regulation
\nmust  itself  indicate those cases in  which  principles  of
\nnatural\t justice  can be totally abrogated  after  recording
\nreasons.\n<\/p>\n
    As far as termination of service of a permanent employee
\non grounds which do not constitute misconduct is  concerned,
\nassuming that this is held to be permissible, it can be only
\nin  very exceptional cases and that too after  observing  at
\nleast the elementary principle of natural justice of  asking
\nfor  explanation  before terminating the services  and\talso
\nrecording  reasons. Shri Ramamurthi urged that to  read\t all
\nthis  into the regulations would literally  mean  re-writing
\nthe  regulations which is not permissible under any  of\t the
\ndecisions or the law.\n<\/p>\n
    As\tone of the cases cover termination under The  Punjab
\nCivil Services Rules, 1952, Shri Ramamurthi drew our  atten-
\ntion  to some of the provisions of these rules. He drew\t our
\nattention  to  rule 3.12 which provides that unless  in\t any
\ncase  it be otherwise provided in those rules, a  Government
\nemployee  on substantive appointment to any  permanent\tpost
\nacquired  a  lien on that post and ceased to hold  any\tlien
\npreviously  acquired  on any other post. He  also  drew\t our
\nattention  to  rule 3.15(a) which provided  that  except  as
\nprovided  in  clause (b) and (c) of that rule  and  in\tnote
\nunder rule 3.13, a Government employee’s lien on a post may,
\nin  no circumstances, be terminated, even with his  consent,
\nif  the\t result would be to leave him without a\t lien  or  a
\nsuspended  lien\t upon a permanent post. Clause (b)  of\trule
\n3.15  provided that notwithstanding the provisions  of\trule
\n3.14(a), the lien of a Govern-\n<\/p>\n
208<\/span><\/p>\n
ment  employee holding substantively a permanent post  shall
\nbe terminated while on refused leave granted after the\tdate
\nof compulsory retirement under rule 6.21; or on his appoint-
\nment  substantively  to the post of Chief  Engineer  of\t the
\nPublic Works Department. And clause (c) of this rule provid-
\ned  that a Government employee’s lien on a  permanent  post,
\nshall  stand terminated on his acquiring a lien on a  perma-
\nnent  post (whether under the Central Government or a  State
\nGovernment)  outside  the cadre on which he is\tborne.\tNote
\nunder  rule 3.13 speaks about a Government employee  holding
\nsubstantially  the  post of a Chief Engineer of\t the  Public
\nWorks  Department, taking leave immediately on vacating\t his
\npost  he then shall during the leave be left without a\tlien
\non  any permanent post. The expression ‘vacate’ used in\t the
\nnote  refers only to vacation as a result of  completion  of
\ntenure of attainment of superannuation.\n<\/p>\n
    Mr. R.K. Garg, appearing for the respondents in C.A. No.
\n4073  of 1986 stated that the Attorney General\thad  rightly
\npointed\t out that employee’s services were terminated  under
\nPara  522 of the Shastri Award merely because he had  failed
\nto mention a loan of Rs. 1.5 lakhs taken from another Branch
\nof  the\t Bank. Mr. Garg pointed out that the loan  had\tbeen
\nrepaid.\t The failure to mention this loan had  deprived\t the
\nappellant  of his livelihood. The use of this power  claimed
\nunder Para 522 of the Shastri Award was not defended by\t the
\nAttorney  General in this case. We had fairly conceded\tthat
\nhe might not support this termination when the case is heard
\non merits. But, that does not derogate from the wide  ampli-
\ntude  of this uncontrolled, arbitrary power claimed  by\t the
\nmanagement  under  Para\t 522 of the  Shastri  Award.  Powers
\nclaimed\t under Para 522 must, therefore, be examined in\t the
\nbackground of the facts and circumstances of this Appeal. It
\nwas submitted that this Court must hold that nothing in Para
\n522 of the Shastri Award confers on the management power  so
\nfar as they can get rid of permanent employees of the  Banks
\nmerely after service of notice on the imaginary belief\tthat
\nthey were doing so for “efficient Management” of the  Banks.
\nMr.  Garg reminded us that it is common knowledge  that\t all
\ndespots act as tyrants in the firm belief that the intolera-
\nble indignities and atrocities they inflict, were  necessary
\nin public interest and to save the Society. Mr. Garg submit-
\nted  that the rule of law cannot be preserved  if  absolute,
\nuncontrolled powers are tolerated and fundamental rights  or
\nDirective  Principles are allowed to be reduced to  a  “dead
\nletter”.\n<\/p>\n
    Mr.\t Garg  urged that the  fundamental  requirements  of
\nnatural\t justice  are not dispensible  luxury.\tThe  express
\nlanguage of Para 522 of
\n209<\/span>
\nthe  Shastri Award is totally destructive of  this  require-
\nment.\n<\/p>\n
    The\t express language as mentioned hereinbefore of\tPara
\n522 of the Shastri Award provides:\n<\/p>\n
“(1) In cases not involving disciplinary action for  miscon-
\nduct  and subject to clause (6) below. The employment  of  a
\npermanent employee may be terminated by three months’ notice
\nor on payment of three months’ pay and allowances in lieu of
\nnotice.\t The services of a probationer may be terminated  by
\none month’s notice or on payment of a month’s pay and allow-
\nances in lieu of notice.”\n<\/p>\n
Rule 148(3) reads:\n<\/p>\n
“(3)  Other  (non-pensionable)\trailway\t servants  shall  be
\nliable\tto  termination\t on notice on either  side  for\t the
\nperiods\t shown below. Such notice is not, however,  required
\nin  cases of dismissal or removal as a disciplinary  measure
\nafter compliance with the provisions of Clause (2) of  Arti-
\ncle 311 of the Constitution, retirement on attaining the age
\nof superannuation, and termination of service due to  mental
\nor physical incapacity.”\n<\/p>\n
“Note: The appointing authorities are empowered to reduce or
\nwaive, at their discretion, the stipulated period of  notice
\nto be given by an employee, but the reason justifying  their
\naction should be recorded.”\n<\/p>\n
Rule 348(4) reads:\n<\/p>\n
“In lieu of the notice prescribed in this rule, it shall  be
\npermissible  on\t the part of the Railway  Administration  to
\nterminate the service of a railway servant by paying him the
\npay for the period of notice.”\n<\/p>\n
Rule 149(3) reads:\n<\/p>\n
“Other\trailway\t servants:  The services  of  other  railway
\nservants shall be liable to termination on notice on  either
\nside for the periods shown below. Such notice is not  howev-
\ner, required in cases of dismissal or removal as a discipli-
\nnary measure after compliance with the provisions
\n210<\/span>
\nof clause (2) of Article 311 of the Constitution, retirement
\non  attaining the age of superannuation, and termination  of
\nservice due to mental or physical incapacity.”\n<\/p>\n
    It\twas urged by Mr. Garg that the services of a  perma-
\nnent  bank employee cannot be terminated without  charge  of
\n‘misconduct’ and without an enquiry and the aforesaid  para-
\ngraph  gives  no indication as to on  what  conditions\tthis
\narbitrary  uncontrolled power can be used to get rid of\t one
\nor  more  permanent employees for “efficient  management  of
\nBanks”\ton  subjective opinions or suspicion not  tested  in
\nenquiry into facts. It was further urged that this provision
\nprovides  for “insecurity of tenure” for lakhs of  permanent
\nemployees, Articles 14, 19(1)(g) and 21 of the\tConstitution
\nand  the integrated protection of these\t Fundamental  Rights
\nexcludes the “doctrine of pleasure” and insists on  security
\nof  tenure “during good behaviour”. The right to  livelihood
\ncannot\tbe  rendered  precarious or reduced  to\t a  glorious
\nuncertainty”,  it was urged by Mr. Garg. Mr. Garg  submitted
\nthat  the  right  to “hire and\tfire”  was  the\t prerogative
\nclaimed by the employer in the days of uncontrolled “laissez
\nfaire.” This was the “doctrine of pleasure of the Crown”  in
\ncase  of  Government servants, who held\t office\t during\t the
\npleasure  of the King who had absolute powers over his\tsub-
\njects. Articles 14, 19(1)(g) and 21 secure the rights of the
\ncitizen\t and act as limits on the powers of the\t “State”  in
\nDemocratic  Republic  of India.\t Unjust,  arbitrary,  uncon-
\ntrolled\t power\tof “premature” termination  of\tservices  of
\npermanent employees should not be tolerated according to Mr.
\nGarg by the Constitution of free India.\n<\/p>\n
    In\tcase  of Government servants,  Articles\t 311(1)\t and
\n311(2) of the Constitution expressly restrict the  “doctrine
\nof  pleasure”  contained  in Article 310.  Article  14\talso
\ninsists\t on  natural  justice as  was  provided\t in  Article
\n311(2), in order to prevent arbitrary use of power of termi-
\nnation. Articles 19(1)(g) and 21 read together require just,
\nfair  and reasonable procedure for termination\tof  services
\nfor  good  cause. Without these\t safeguards,  employees\t are
\nreduced to the status of slaves of their masters.  Employers
\nare  no longer masters as in the days of slavery  of  feudal
\nrelations,  Mr. Garg tried to emphasise. He  submitted\tthat
\nArticle\t 14  of the Constitution did  not  permit  permanent
\nrailway\t employees  to be exposed to  termination  of  their
\nservices on notice without charge of misconduct or a reason-
\nable opportunity to answer the charge. Rules 148 and 149  of
\nthe  Railway  Establishment Code which have  been  set\tonly
\nhereinbefore have the same effect, as is the effect of\tpara
\n522 of the Shastry Award, and both these Rules were declared
\nunconstitutional in Moti Ram Deka’s case (supra) by a seven
\n211<\/span>
\nJudges’ Bench, according to Mr.-Garg.\n<\/p>\n
    Rules 148 and 149 were found violative of Article 14 for
\ntwo reasons, it was submitted:\n<\/p>\n
       (i) Railway servants in the matter of termination  of
\nservice\t could not form a separate Class from other  Govern-
\nment  servants\t(As per majority view, in  the\tJudgment  of
\nJustice\t Gajendragadkar, in Moti Ram Deka ‘5 case  [1964]  5
\nSCR 683,729-731).\n<\/p>\n
       (ii) Rule 148 conferred unguided, uncontrolled  power
\nof  termination and, therefore, was hit by Article  14.\t (As
\nper  Justice  Subba Rao and Justice Das Gupta, in  Moti\t Ram
\nDeka’s case (supra).\n<\/p>\n
    Mr.\t Garg sought to urge that this binding\tdecision  of
\nseven  Judges’ Bench in Moti Ram Deka’s (supra) was  applied
\nin  Gurdev Singh Sidhu v. State of Punjab & Anr.,<\/a>  [1964]  7
\nSCR 587 at 592-593 by the Constitution Bench of five  Judges
\nto  strike  down a Service Rule which  permitted  compulsory
\nretirement on completion of 10 years’ services on the ground
\nof  ‘inefficiency’  etc.  This Court  held  that  Compulsory
\nretirement  could  not be tolerated even after 10  years  of
\nservice in view Of such retirement being not based on  rele-
\nvant  considerations, including expected  longivity of\tlife
\nof the employees in India. If the power of removal by way of
\ncompulsory  retirement even after ten years was held  uncon-
\nstitutional  in Gurdev Singh’s case (supra) para 522 of\t the
\nShastri Award was far more arbitrary, unjust and  unreasona-
\nble, it was urged before us.\n<\/p>\n
    It was reiterated before us that in view of the  binding
\ndecision  of  seven Judges in Moti Ram Deka’s Case  and\t its
\napplication by five Judges in Case of compulsory  retirement
\nafter  10  years in Gurdev Singh’s Case (supra), it  is\t not
\nopen to the employees to submit that similar powers  claimed
\nunder  paragraph 522 of the Shastri Award, even\t without  10
\nyears’\tservice for removal without charge  of\t‘misconduct’
\nand without enquiry, can be upheld as constitutional on\t any
\ngrounds whatsoever. It cannot be upheld as constitutional on
\nany  grounds  whatsoever. It cannot be\tdone  without  over-
\nruling Moti Ram Deka’s case or without an express  constitu-
\ntional\tprovision  like second Proviso (a), (b)\t or  (C)  to
\nArticle 311(2), which was adopted.by the Constituent  Assem-
\nbly, not by a court of law, it was reiterated before us.\n<\/p>\n
212<\/span><\/p>\n
    It\twas  submitted that no principle  of  interpretation
\npermits\t reading  down a provision so as to make it  into  a
\ndifferent  provision  altogether  different  from  what\t was
\nintended  by the legislature or its delegate. (R. M.D.C.  ‘s
\ncase (supra).\n<\/p>\n
    It was urged that it was established law that on reading
\ndown  a provision, Court cannot preserve a power for a\tpur-
\npose which is just the opposite of what the legislature\t had
\nintended.  Para\t 522  of the Shastri Award was\tnot  at\t all
\nintended to be used within limits expressed or implied.\t The
\nCourt must not legislate conditions such as were adopted  by
\nthe Constituent Assembly in case of second Proviso to  Arti-
\ncle  311(2)  in the Constitution of India.  Even  Parliament
\ncould  not  graft  such limitations on\tArticle\t 311(2),  if
\nsecond Proviso to Article 311 was not there in the Constitu-
\ntion.  This Court cannot and ought. it was submitted not  to
\narrogate powers to legislate what was patently outside\teven
\nthe competence of Parliament of India.\n<\/p>\n
    It\twas  submitted that in Tulsi Ram Patel’s  Case,\t the
\nmajority  decision could not hold second Proviso to  Article
\n311(2)\tunconstitutional.  In order to give  effect  to\t the
\nexpress language of second Proviso to Article 311(2),  Court
\ndenied the protection of Article 14 to permit the  President
\nto  terminate the services without following  principles  of
\nnatural\t justice’ in cases covered by the said\tProviso.  In
\nevery other case, natural justice is the command of  Article
\n311(2) of the Constitution was submitted.\n<\/p>\n
    The operation of Articles 14, 19(1)(g) and 311(2) of the
\nConstitution  does not permit Courts to lay  down  essential
\nlegislative policy, such as was laid down by the Constituent
\nAssembly to over-ride 311(2) of the Constitution.
\n    Mr.\t Garg, therefore, submitted that the requirement  of
\ndefining  ‘misconduct’ in the Standing Orders and  providing
\nby  meticulous\tprovisions for a just, fair  and  reasonable
\nenquiry\t into  charges\tof ‘misconduct’\t are  the  mandatory
\nrequirement  of Industrial Employment Standing\tOrders\tAct.
\n(U. P State Electricity Board v. Hari Shankar Jain,<\/a> [1979] 1
\nSCR 355\/362-3).\n<\/p>\n
    Shri Garg urged that the I.L.O. Conventions, accepted by
\nIndia.\trequired all employers to frame Standing Orders.  He
\nfurther\t urged\tthat the demands of natural  justice,  which
\nform part of Article 14 of the Constitution have been raised
\nto  the status of ‘public policy’ controlling section 23  of
\nthe Indian Contract Act. On that basis, clauses in
\n213<\/span>
\ncontract of employment which provide for removal from  serv-
\nice on the will of the employer have been condemned as\t‘The
\nHenry  VIII Clause’ (see the observations of this  Court  in
\nCentral\t Inland\t Water Transports case (supra)\tagainst\t the
\nethos  of the Constitution of Socialist Democratic  Republic
\nof  India.  In this connection, reference was  made  to\t the
\ndecision  of this Court in Central Inland Water\t Transport’s
\ncase  (supra)  and Maneka Gandhi’s case (supra).  In  India,
\nShri Garg submitted. workers have a right to participate  in
\nthe  management. The participation in the management  cannot
\nexclude\t the ‘power to be heard’ and thus participate  in  a
\ndecision  to remove a permanent employee.  Government  alone
\nhas  power  to refer to the industrial tribunal,  Shri\tGarg
\nsubmitted. He was against any reading down which is contrary
\nto  the\t principles of interpretation. He  referred  to\t the
\nobservations of the Privy Council in Nazir Ahmed’s case [AIR
\n1936  PC  253]. He submitted that if two  provisions  exist,
\nfirstly, to remove from service after holding an enquiry  on
\na  charge of a ‘misconduct’; and secondly without serving  a
\ncharge-sheet or holding an enquiry all provisions for  hold-
\ning enquiry will be rendered otiose and will be reduced to a
\nmere redundancy. Such an interpretation will expose  workers
\nto  harsher treatment than those guilty of  misconduct,\t who
\nwill enjoy greater protection than those who have  committed
\nno misconduct. Such powers are patently discriminatory.
\n    Reference  under section 10 of the\tIndustrial  Disputes
\nAct would serve no purpose, submitted Mr. Garg. Court has  a
\nduty,  according  to him. to correct wrongs even  if  orders
\nhave been made which are later found to be violative of\t any
\nfundamental  right and to recall its orders to avoid  injus-
\ntice.  He  referred to the decision of this  Court  in\tA.R.
\nAntulay v. R.S. Nayak and Anr.,<\/a> [1988] 2 SCC 602. He remind-
\ned  us\tthat  no draft had been submitted  by  the  Attorney
\nGeneral or the Solicitor General, which could be added as  a
\nproviso to para 522 of the Shastri Award by this Court as  a
\npiece  of  judicial legislation to amend the  impugned\tpara\n<\/p>\n
522.  Substantive  provision of para 522 could not  be\tcon-
\ntrolled or curtailed effectively so that its operation could
\nbe  confined within narrow constitutional limits.  Mr.\tGarg
\nreminded us that it is not the duty of the court to  condone
\nthe  constitutional  delinquencies of those limited  by\t the
\nConstitution if they arrogate uncontrolled  unconstitutional
\npowers, which are neither necessary nor germane for supposed
\nefficiency  of\tservices in the Banks as a  business  enter-
\nprise. Mr. Garg submitted that in a system governed by\trule
\nof law, discretion when conferred upon executive authorities
\nmust be confined within clearly defined limits. The rule  of
\nlaw  from this point means that decisions should be made  by
\nthe application of known
\n214<\/span>
\nprinciples and rules and. in general, such decisions  should
\nbe predictable and the citizen should know where he is.\t Law
\ncan only reach its finest moments when it has freed man from
\nthe unlimited discretion of ruler. He referred to the obser-
\nvations of this Court in S.C. Jaisinhhani v. Union of  India
\nand Ors., [1967] 2 SCR 703 at p. 718-19.\n<\/p>\n
    On\tbehalf of the Interveners in Civil Appeal No.  2876,
\nMr. P.P. Rao submitted that the aforesaid decision in  Tulsi
\nRam  Patel’s case (supra) was an authority for the  proposi-
\ntion that but for clause (b) of the second proviso to  Arti-
\ncle  311(2) of the Constitution, the principles\t of  natural
\njustice\t could\tnot  have been excluded from  the  scope  of
\nArticle 14 of the Constitution. It was urged by him that the
\nsaid second proviso to Article 311(2) being itself a consti-
\ntutional provision, such exclusion was upheld by this  Court
\nin the said Tulsi Ram Patel’s case (supra). page 237 and  at
\nlast  para  to\tp. 242. Mr. Rao drew our  attention  to\t the
\nwell-settled rule of interpretation and submitted that where
\ntwo  interpretations are possible, one of which\t would\tpre-
\nserve  and  gave  the constitutionality\t of  the  particular
\nstatutory  provision while the other would render it  uncon-
\nstitutional and void, the one which saves and preserves\t its
\nconstitutionality should be adopted and the other should  be
\nrejected. Fie, further, submitted that unless the  provision
\nof the Constitution itself excludes the principles of  natu-
\nral  justice, they continue to be applicable as an  integral
\npart  of the right to equality guaranteed by  the  Constitu-
\ntion.\n<\/p>\n
    It\twas further reiterated that as the employees of\t the
\nDTC  were  not Government employees, Article 311(2)  of\t the
\nConstitution  was not applicable. Consequently,\t the  second
\nproviso\t thereof  was also not applicable, with\t the  result
\nthat  Article 14 of the Constitution fully applied  to\tthem
\nand it included the principles of natural justice as held in
\nTulsi Ram Patel’s (supra) itself at p. 233, last  paragraph.
\nMr.  Rao submitted that it is not permissible to  read\tdown
\nstatutory  provisions when the avowed purpose is  to  confer
\npower on an authority without any limitation whatever.\tThat
\nwould be reading down contrary to the expressed or  manifest
\nintention  of the legislature. He drew our attention to\t the
\nobservations of this Court in Minerva Mills Limited v. Union
\nof India & Ors.,<\/a> [1981] 1 SCR 206 at 261. Therein, at p. 259
\nof  the\t report, it was reiterated that\t the  principles  of
\nreading down could not be distorted even when words of width
\nare used inadvertently. In the instant case, Mr. Rao submit-
\nted, reading down would amount to distortion of the right to
\nequality  conferred by Article 14, which was regarded  as  a
\nbasic  feature\tof  the Constitution. Nothing  short  of  an
\namendment  of the Constitution could cut down the  scope  of
\nthe basic
\n215<\/span>
\nprinciple of equality, submitted Mr. Rao then referred to us
\nKesavananda  Bharati  v.  State of Kerala,<\/a>  [1973]  Supp.  1
\nS.C.R.\t1  and submitted that any  constitutional  amendment
\nwhich impairs the doctrine of equality would be liable to be
\ndeclared unconstitutional on the ground of violation of\t the
\nbasic structure of the Constitution.\n<\/p>\n
    In the instant case, Mr. Rao submitted, regulation\t9(b)
\ndeliberately conferred wide power of termination of  service
\nwithout giving a reasonable opportunity to an employee\teven
\nif  he\tis a regular or permanent employee, in\taddition  to
\nregulation 15 which provided for dismissal or removal  after
\na  disciplinary\t enquiry. Therefore, the  intention  of\t the
\nregulation-making  authority was clear and unambiguous.\t The
\nprovision is not capable of two interpretations. Consequent-
\nly, the question of reading down did not arise. Mr. Rao drew
\nour  attention to the observations of the Supreme  Court  of
\nAmerica\t in Elliott Ashton Welsh, II  v. United\t States,  26
\nLawyers’ Edition 2nd, 308 at 327. Mr. Rao submitted that the
\ndecisions  referred to by the learned Attorney General\twere
\nnot  applicable to the instant case. He submitted  that\t the
\ndecision of the Federal Court in Re The Hindu Women’s Rights
\nto  Property Act’s case (supra) involved the  interpretation
\nof  a single word in the context of legislative\t competence.
\nThat was not the context of the present controversy, submit-
\nted  Mr. Rao. Mr. Rao submitted that R.M.D.  Chamarbaughwal-
\nla’s  case  (supra) was a case on severability. That  was  a
\ncase  where the word ‘competition’ was interpreted.  In\t the
\npresent case, the suggested reading down involves, according
\nto Mr. Rao, not interpretation of any single word in regula-
\ntion 9(b) but adding a whole clause to it which amounted  to
\nrewriting  the\tprovisions. Courts have refused\t to  rewrite
\nlegislation to make up for the omissions of the legislature.
\nReliance was placed by Mr. Rao on Nalinakhya Bysack v. Shyam
\nSunder Halder & Ors.,<\/a> [1953] SCR 533, at p. 544-545. Mr\t Rao
\nreferred  to  the observations of this Court in\t Kedar\tNath
\nSingh  v. State of Bihar, (supra) involving the\t interpreta-
\ntion of section 124A IPC in the context of Article  19(1)(a)
\nof the Constitution. The content of Article 19(1)(a) was not
\ncut  down. In the present case, the suggested  reading\tdown
\nwould inevitably drain out Article 14 of its vitality.
\n    Shri  Rao  drew our attention to the  decision  of\tthis
\nCourt  in R.L. Arora v. State of Uttar Pradesh,<\/a> (supra)\t and
\nsubmitted  that\t the said decision did not  involve  cutting
\ndown  the  scope of a fundamental right. He  also  drew\t our
\nattention to the decision of this Court in Jagdish Pandey v.
\nThe  Chancellor, University of Bihar<\/a> (supra) which  did\t not
\ninvolve\t reading  down so as to sacrifice the  principle  of
\nnatural justice
\n216<\/span>
\nwhich  are considered an essential part of the rule of\tlaw.
\nIn Municipal Committee, Amritsar & Anr. v. State of Punjab &
\nOrs.,<\/a>  [1969] 3 SCR 447, this Court was concerned  with\t the
\nintention  of the legislature and interpreted the  Act\tcon-
\nsistent\t with the said intention. In the instant  case.\t the
\nintention was to confer power of termination of services  of
\nall  categories\t of employees without any  further  enquiry.
\nSunil  Batra  v. Delhi Administration<\/a> (supra)  was  again  a
\ndecision  where this Court found that the intention  of\t the
\nlegislature  was not to confer arbitrary power. In  the\t in-
\nstant  case,  the intention was different. N.C.\t Dalwadi  v.
\nState  of Gujarat.<\/a> (supra) was a case of  giving  reasonable
\ninterpretation\tto a provision which was capable of such  an
\ninterpretation. In the scheme of DTC Regulations. regulation
\n9(b)  was not susceptable to two interpretations.  submitted
\nMr. Rao. According to Mr. Rao, the principle of reading down
\nwas not applicable where the intention of the law maker\t was
\nto confer too wide a power intended to be exercised  without
\ngiving an opportunity to the affected party to be heard.  It
\nwas, therefore, submitted that the principle of reading down
\nwas  not applicable and if applied would amount\t to  cutting
\ndown  the scope of Article 14 and subjecting  permanent\t em-
\nployees of the DTC to a tremendous sense of insecurity which
\nis against the philosophy and scheme of the Constitution.
\n    Mr\tNayar,\tappearing  in  Civil  Appeal  No.  1115\t  of
\n1976–(Shri  Samara Singh v. Zila Parishad  Ferozepure)\t for
\nthe  respondent,  drew our attention to the  fact  that\t the
\nappellant, Shri Satnam Singh was appointed by the respondent
\nvide letter of appointment dated 9th March. 1961 the  appel-
\nlant  ceased to work for the respondent, when  his  services
\nwere  terminated  simpliciter  vide  Resolution\t dated\t26th
\nNovember, 1965. He, therefore, had worked for the respondent
\nonly  for a short period of less than four years. The  serv-
\nices  of the appellant ceased on the basis of the  contract.
\nthe terms of which were mutually agreed between the parties.
\nIn case he had continued to work, he would have reached\t the
\nage of superannuation in the year 1984. His total emoluments
\nwith  effect  from  1st November,  1964 to  30th  September,
\n1984  would have been approximately Rs.2,46,464.  Mr.  Nayar
\nfiled  a  detailed statement and stated that  the  appellant
\nceased\tto  work for the respondent with  effect  from\t26th
\nNovember, 1964 when he was discharged from service.
\n    In\tthis case, it is necessary to bear in mind that\t the
\nappellant,  Shri Satnam Singh was appointed by the  respond-
\nent,  Zila  Parishad, Ferozepure by letter  of\tappointments
\ndated  9th  March.  1961. The Board approved  his  terms  of
\nappointment and the same were duly
\n217<\/span>
\naccepted by the appellant. The ‘relevant clause of  Contract
\nbetween the parties for present purposes was clause 4  which
\nwas as follows:\n<\/p>\n
“His  services will be terminated on one month’s  notice  on
\neither\tside provided it will be open to pay him his  salary
\nfor the period by which the notice falls short of one month.
\nSimilarly, if he wishes to resign he may do so by depositing
\nwith  the District Board his salary for the period by  which
\nthe notice given by him fails short of one month.”\n<\/p>\n
    The appellant, however, was continued to be governed  by
\nthe  Statutory Rules, known as District Board  Rules,  1926.
\nAccording to the respondent, the appellant did not cooperate
\ninasmuch  as  he was not available in the  Headquarters\t and
\npresumably left without permission and without handing\tover
\nimportant  record and documents of the District Board,\tetc.
\nBut  the  appellant’s version, as stated in the\t grounds  of
\nappeal,\t was  entirely different. He urged that\t it  was  on
\naccount\t of vindictive attitude on the part of some  of\t the
\nemployees of the respondent, which had produced his termina-
\ntion order without enquiry. The District Board resolved that
\nin  terms  of condition 4 of the terms of  appointment,\t his
\nservices  should be terminated on one month’s notice or\t pay
\nin lieu thereof.\n<\/p>\n
    Mr.\t Nayar\tsubmitted that rule 1(i) of  District  Board
\nRules,\t1926, Part V also gave right to both the parties  to
\nterminate the contract of employment on one month’s  notice,
\netc. The said rule reads as follows:\n<\/p>\n
“In the absence of a written contract to the contrary  every
\nofficer\t or  servant employed by a District Board  shall  be
\nentitled  to one month’s notice before discharge or  to\t one
\nmonth’s\t wages\tin  lieu thereof, unless  he  is  discharged
\nduring\tthe  period of probation or for\t misconduct  or\t was
\nengaged\t for a specified term and discharged at the  end  of
\nit.”\n<\/p>\n
    The\t services  of  the appellant  were  terminated\tvide
\nResolution dated 26th November, 1964 of the Board and he was
\ndischarged  by\tallowing him one month’s salary in  lieu  of
\nnotice. The termination order was dated 14th December, 1964.
\nThe  appellant, Shri Satnam Singh filed a suit for  declara-
\ntion in the Court of Senior Sub-Judge, Ferozepure, challeng-
\ning  the order of termination dated 14th December,  1964  as
\nillegal,  void,\t ultra\tvires, etc.  The  Senior  Sub-Judge,
\nFerozepure, vide judgment and decree dated 9th January, 1969
\nheld
\n218<\/span>
\nthat  the discharge of the appellant amounted  to  dismissal
\nand as clearly no enquiry was held against him, the termina-
\ntion simpliciter was bad in law. The respondent, Zila  Pari-
\nshad filed an appeal in the Court of 3rd Additional District
\nJudge, Ferozepure, who vide order dated 22nd December,\t1969
\naffirmed  the decision of the trial Judge and dismissed\t the
\nappeal\tof  the\t respondent. The  respondent  filed  regular
\nappeal\tin the High Court of Punjab and Haryana\t at  Chandi-
\ngarh,  inter alia, pleading that the appellant\twas  validly
\ndischarged in terms of his appointment order and rule  1(i),
\nPart V-A of the District Board Rules, 1926.\n<\/p>\n
    The\t learned Single Judge of the High  Court  considered
\nthe  matter in detail and referred to various  judgments  of
\nthis  Court  and  held that it could not be  said  that\t the
\naction\tof termination prima facie amounted to an  order  of
\ndismissal  even though the appellant was at the time a\tcon-
\nfirmed employee of the respondent. The learned Single  Judge
\nfound that the respondent had a contractual right to  termi-
\nnate  the  services  of the appellant by  giving  a  month’s
\nnotice\tor a month’s salary in lieu of notice. According  to
\nShri Garg, the removal of the appellant from service was  in
\naccordance with the terms governing his appointment.  Merely
\nbecause\t on  the 7th of November, 1964, the  respondent\t re-
\nsolved\tto charge sheet the appellant for acts\tof  omission
\nand  commission and ordered an enquiry, and such an  enquiry
\nnever  commenced,  would certainly not be enough  reason  to
\nhold  that the termination of the appellant’s services,\t was
\nordered by way of punishment and therefore, amounted to\t his
\ndismissal,  argued Mr. Nayar. It was submitted by Mr.  Nayar
\nthat  the  appellant had conceded that condition no.  4\t was
\nlegally\t good but he had argued that it was not meant to  be
\neffective after the appellant had been confirmed.
\n    Aggrieved  by the order mentioned above,  the  appellant
\nhad filed Letters Patent Appeal before the Division Bench of
\nthe  High Court. The Division Bench of the High Court by  an
\norder  dated 13th September, 1972 referred the\tquestion  of
\nlaw  for the decision of the full bench. The full  bench  of
\nthe High Court refrained the question of law as under:
\n“Whether,  the termination of services of a  permanent\tDis-
\ntrict Board Employee by giving him one month’s notice or pay
\nin  lieu thereof in terms of the conditions of his  appoint-
\nment and\/or rule 1 in part V-A of the District Board  Rules,
\n1926, is bad in law and cannot be made?\n<\/p>\n
219<\/span><\/p>\n
    The\t majority  of the learned Judges, inter\t alia,\theld
\nthat  the  appellant not being a government  servant  cannot
\nhave the protection of Article 311 of the Constitution as he
\nwas not a civil servant under the Central Government of\t the
\nState  Government. He was an employee of the District  Board
\nand his tenure of appointment was governed by the provisions
\nof  the\t District  Board’s Act, 1883 and  the  rules  flamed
\nthereunder  as\twell as by the terms and conditions  of\t his
\nappointment.  The condition no. 4 gave mutual right  to\t the
\nDistrict Board as well as to the appellant to terminate\t the
\nservice\t by  giving  one month’s notice or pay\tin  lieu  of
\nnotice,\t etc. The condition in the appointment letter  shall
\nnot  be\t deemed to have been abrogated by the  Punjab  Civil
\nServices  Rules. The Court held further that  the  condition
\nstated in the letter of appointment of the appellant contin-
\nued to bind the parties even after the appellant’s confirma-
\ntion  and  his services could be terminated by an  order  of
\ndischarge simpliciter in accordance with the condition no. 4
\nthereof\t as this condition was almost in the same  terms  as
\nRule I in Part V-A of the Rules. It was further held by\t the
\nfull  bench of the High Court that the Punjab Civil  Service
\nRules  had  no over-riding effect and these  rules  were  to
\napply in respect of matters for which no provision had\tbeen
\nmade anywhere else because of the phrase used “so far as may
\nbe”.\n<\/p>\n
Rule 8.1 of the Business Rules reads as under:
\n“In all matters relating to the conditions of service of its
\nemployees the Board shall so far as may be follow the  rules
\nfrom  time to time in force for servants of the Punjab\tGov-
\nernment.”\n<\/p>\n
    The\t finding of the Letters Patent Bench in this  regard
\nwas as under:\n<\/p>\n
“According to Rule 8.1 ibid, the Punjab Civil Services Rules
\nwere  to apply in respect of matters for which no  provision
\nhad  been made anywhere else because of the phrase used\t “so
\nfar as may be”. Naturally, if a provision was made  anywhere
\nelse, which went counter to the Punjab Civil Services Rules,
\nthe application of the latter rules It thus follows that the
\nPunjab Civil Services Rules were not to apply to the  appel-
\nlant in respect of matters for which specific provision\t was
\nmade  in  his letter of appointment, which  constituted\t the
\ncontract  of service between him and the District Board,  as
\nhe joined
\n220<\/span>
\nservice on those terms.after accepting the same.”\n<\/p>\n
    The\t learned  Chief\t Justice of Punjab  &  Haryana\tHigh
\nCourt,\thowever,  dissented.  The answer  to  the  question,
\ntherefore,  was given in the negative vide order  dated\t 3rd
\nApril,\t1974.  The Division Bench of the  High\tCourt  which
\nheard  the matter after the question of law was answered  by
\nthe  Full Bench, dismissed the appeal of the appellant\tvide
\norder dated 28th October, 1974 and this appeal to this Court
\narises from this order.\n<\/p>\n
    The appellant in Civil Appeal No. 1115\/76, who  appeared
\nin person before us reiterated the relevant facts and  urged
\nthat  his  removal was bad and the rule under which  he\t was
\nremoved may be quashed. It may be mentioned that as  regards
\nletter of Shri Kuldip Singh Virk to the Senior\tSuperintend-
\nent  of Police, Ferozepure regarding the charges of  corrup-
\ntion  against  the appellant, a case under s.  5(2)  of\t the
\nPrevention  of Corruption Act was registered. The  appellant
\nwas tried for the said alleged offence and acquitted of\t the
\ncharges by the Special Judge Ferozepure. A further case\t was
\nregistered under ss. 381\/ 409 of IPC against the  appellant.
\nAccordingly, the appellant was tried by the Judicial  Magis-
\ntrate  Ferozepure.  The charge was framed  by  the  Judicial
\nMagistrate against the appellant. Against the aforesaid, the
\nappellant filed a petition in the High Court and the  charge
\nand  the proceedings in question were thereupon\t quashed  by
\nthe  High Court in July\/August, 1967. There were three\tmore
\ncases tried by the Special Judge, Ferozepure and acquitted.
\n    The\t appellant filed a document in this  Court  claiming
\nthe  monetary  claim on the basis that his  termination\t was
\nwrongful.  According  to the appellant, he was\tentitled  to
\nrecover\t Rs.4,83,061.90\t paise. However.  according  to\t the
\nstatement  filed  by  Shri Nayar, learned  counsel  for\t the
\nrespondents  in\t this case, the appellant  was\tentitled  to
\nwithdraw  from the District Board Rs.2,46,464.46  paise,  in
\ncase he would have been in service before his date of super-
\nannuation, i.e., 30th September, 1984. There is no  evidence
\nfrom  either  side as to whether the  appellant\t had  worked
\nsomewhere  else though the appellant did not work  with\t the
\nrespondent  because  of his suspension. The  appellant\thad,
\nhowever, stated that he did not so work. In that view of the
\nmatter,\t if the contentions or’ the appellant  are  accepted
\nthat  the clause under which the terms of employment of\t the
\nappellant  was\tagreed and under which the  termination\t was
\neffected without any enquiry and further in view of the fact
\nthat  the learned trial Judge before whom the appellant\t had
\nfiled the suit first and decreed the suit declaring the
\n221<\/span>
\nappellant to be entitled to be in service, the appellant, in
\nour opinion. should rightly be granted a monetary claim\t for
\nRs.4,83,061.90\tpaise and further interest at 6%  from\t30th
\nSeptember,  1984. This would be in consonance  with  justice
\nand equity in the facts and the circumstances of this  case.
\nThis order, however, will have to be passed if we accept the
\ncontention  on\tbehalf of the appellant herein on  the\tcon-
\nstruction of the clause.\n<\/p>\n
    In\tthe  matter  of M\/s Indian Airlines,  which  is\t the
\nsubject-matter of the Application for Intervention No. 1  of
\n1990:in Civil Appeal No. 2846 of 1986, Mr. Lalit Bhasin,  on
\nbehalf\tof  the interveners contended that  there  has\tbeen
\ndistinction between the discharge simpliciter and  dismissal
\nfrom  service by way of punishment. According to Mr.  Bhasin
\nthe  effect  of the judgments of this Court in\tthe  Central
\nInland Water’s case (supra) and West Bengal’s (supra) was to
\ntake  away the right of the employer to terminate the  serv-
\nices of an employee by way of discharge simpliciter. Accord-
\ning  to Mr. Bhasin, this Court had recognised the  existence
\nof the inherent right of an employer to terminate the  serv-
\nices  of an employee in terms of the contract of  employment
\nand also under the various labour enactments.
\n    Attention of this Court was invited to the provisions of
\nthe Industrial Employment (Standing Orders) Act, 1946, which
\napplies\t to  all industrial establishments  whether  in\t the
\npublic\tor private sector. Under and as a part of  the\tsaid
\nAct,  model standing’ orders are set out and Standing  Order
\nNo.  13\t provides for simple termination  of  employment  by
\ngiving\tone month’s notice etc. Similarly, there are  provi-
\nsions under various Shops and Establishments Acts of differ-
\nent States providing for termination of employment of perma-
\nnent employee after giving one month’s notice or pay in lieu
\nof  notice. Attention of this Court was invited to s. 30  of
\nDelhi Shops and Establishments Act.\n<\/p>\n
    The\t Industrial  Disputes Act itself  makes\t distinction
\nbetween discharge and dismissal and attention of this  Court
\nwas  invited  to s. 2(00) of the  Industrial  Disputes\tAct,
\nwhich  defines\t‘retrenchment’. This section  expressly\t ex-
\ncludes termination of services as a result of nonrenewal  of
\ncontract  of  employment.  Section 2(s)\t of  the  Industrial
\nDisputes Act defines ‘workman’ to include any person who has
\nbeen dismissed, discharged or retrenched. Section 2A distin-
\nguishes discharge, dismissal and retrenchment.
\n    It\tis pertinent to point out that the Original  Regula-
\ntion 13 of Indian Airlines Employees Service Regulations was
\nset out as under:\n<\/p>\n
222<\/span><\/p>\n
“13.  The services of an employee are terminable at 30\tdays
\non either side or basic pay in lieu:\n<\/p>\n
Provided  however,  the Corporation will be  at\t liberty  to
\nrefuse\tto accept the termination of his service by  an\t em-
\nployee\twhere such termination is sought in order  to  avoid
\ndisciplinary   action\tcontemplated   or   taken   by\t the
\nManagement.”\n<\/p>\n
    After  the\tdecisions of this Court\t in  Central  Inland
\nWater’s\t case  (supra), Indian Airlines initiated  steps  to
\namend  its Regulation 13 and bring it in line  with  Article
\n311(2)\tof  the Constitution as directed by  this  Court  in
\nHindustan  Steels  Lid’ case (supra). It  appears  that\t the
\nBoard  of Directors of Indian Airlines had  accordingly\t ap-
\nproved\tof the amendments to Regulation 13 and\tthe  amended
\nRegulation reads as under:\n<\/p>\n
“(a)  The services of an employee may be terminated  without
\nassigning  any\treasons\t to him\/her and\t without  any  prior
\nnotice\tbut only on the following grounds not  amounting  to
\nmisconduct under the Standing Orders, namely:\n<\/p>\n
(i)  If\t he\/she is, in the opinion of the  Corporation\t(the
\nBoard  of  Directors  of Indian\t Airlines)  incompetent\t and
\nunsuitable for continued employment with the Corporation and
\nsuch  incompetence  and\t unsuitability is such\tas  to\tmake
\nhis\/her continuance in employment detrimental to the  inter-
\nest of the Corporation;\n<\/p>\n
\t\t\t    OR
\nIf  his\/her  continuance in employment constitutes,  in\t the
\nopinion of the Corporation (the Board of Directors of Indian
\nAirlines), a grave security risk making his\/her\t continuance
\nin  a service detrimental to the interests of  the  Corporat
\nion;\n<\/p>\n
\t\t\t     OR
\nif in the opinion of the Corporation (the Board of Directors
\nof  Indian  Airlines) there is such a  justifiable  lack  of
\nconfidence  which,  having regard to the  nature  of  duties
\nperformed,  would make it necessary in the interest  of\t the
\nCorporation, to immediately terminate his\/her services.\n<\/p>\n
223<\/span><\/p>\n
(b) The employee can seek termination of his\/her  employment
\nby giving 30 days notice or basic pay in lieu:
\nProvided  however  the\tCorporation will be  at\t liberty  to
\nrefuse\tto accept the termination of his\/her service  by  an
\nemployee where such termination is sought in order to  avoid
\ndisciplinary   action\tcontemplated   or   taken   by\t the
\nManagement.”\n<\/p>\n
    According  to Mr. Bhasin, in the amended Regulation\t 13,
\nIndian Airlines had taken care to set out the  circumstances
\nin  which the services of an employee can be  terminated  by
\nway  of\t discharge and without holding\tenquiry.  Mr  Bhasin
\nurged  that these are eventualities which do not  constitute
\nmisconduct  and yet retention of an employee in the  service
\nby  the management for any one of the grounds  mentioned  in
\nthe aforesaid Regulation might be considered as\t detrimental
\nfor  the management or against public interest.\t Mr.  Bhasin
\nsubmitted  that the power has been vested with the Board  of
\nDirectors  and\tnot with any individual.  According  to\t Mr.
\nBhasin,\t plain reading of Regulation 13, as  amended,  would
\nclearly establish that the vice. if any, or arbitrariness is
\ncompletely removed and sufficient guidelines are made avail-
\nable to the highest functionary, namely, the Board of Direc-
\ntors to exercise the restricted and limited power now avail-
\nable to the employer under these Regulations.
\n    Similar  submissions  have been made on  behalf  of\t Air
\nIndia,\twho are interveners. Submissions  made\thereinbefore
\nwere alternative submissions. The original Regulation 48  of
\nAir India Employees Service Regulations was as follows:
\n“Termination .’
\nThe  services of an employee may be terminated\twithout\t as-
\nsigning any reason, as under:\n<\/p>\n
(a) of a permanent employee by giving him 30 day’s notice in
\nwriting or pay in lieu of notice;\n<\/p>\n
(b)  of\t any  employee on probation by giving  him  7  days’
\nnotice in writing or pay in lieu of notice:\n<\/p>\n
(c)  of a temporary employee by giving him 24 hours’  notice
\nin writing or pay in lieu of notice.\n<\/p>\n
224<\/span><\/p>\n
Explanation.’  For the purposes of the regulation, the\tword
\n“pay” shall include all emoluments which would be admissible
\nif he were on Privilege leave.”\n<\/p>\n
    After  the decisions of this Court declaring the  afore-
\nsaid  Regulation as void in Civil Appeal No. 19 of  1982  in
\nthe  Case of Manohar P. Kharkar & Anr. v. Kaghu Raj &  Anr.,
\nAir India<\/a> amended the aforesaid Regulation, which now  reads
\nas under:\n<\/p>\n
“(a) The services of a permanent employee may be  terminated
\nwithout\t assigning  any reasons to him\/her and\twithout\t any
\nprior notice but only to the following grounds not amounting
\nto misconduct under Service Regulation 42, namely:\n<\/p>\n
(i)  if\t he\/she is, in the opinion of the  Corporation\t(the
\nBoard of Directors of Air India) incompetent and  unsuitable
\nfor  continued\temployment  with the  Corporation  and\tsuch
\nincompetence  and unsuitability is such as to  make  his\/her
\ncontinuance  in employment detrimental to the  interests  of
\nthe Corporation;\n<\/p>\n
\t\t\t      OR
\nIf  his\/her  continuance in employment constitutes,  in\t the
\nopinion\t of the Corporation (the Board of Directors  of\t Air
\nIndia), a\/grave security risk making his\/her continuance  in
\nservice detrimental) to the interests of the Corporation;\n<\/p>\n
\t\t\t       OR
\nIf,  in the opinion of the Corporation (the Board of  Direc-
\ntors  of  Air India), there is such a  justifiable  lack  of
\nconfidence  which,  having regard to the  nature  of  duties
\nperformed,  would make it necessary, in the interest of\t the
\nCorporation, to immediately terminate his\/her services.\n<\/p>\n
(b)  The services of an employee on probation may be  termi-
\nnated without assigning any reason to him\/her but on  giving
\n30 days notice in writing or pay in lieu thereof.\n<\/p>\n
(c)  The services of a temporary employee may be  terminated
\nwithout\t assigning  any reason to him\/her but on  giving  15
\ndays notice in writing or pay in lieu thereof.\n<\/p>\n
225<\/span><\/p>\n
Explanation  For  the purpose of this  Regulation  the\tword
\n“pay” shall include all emoluments which would be admissible
\nif he were on privilege leave.”\n<\/p>\n
    The question regarding justification of the action taken
\nby  the management was touched by this Court, but since\t the
\naction\twas  based on the old Regulation 48, it\t had  to  be
\nquashed.  It was submitted on behalf of the Air\t India\tthat
\ncare  had been taken to suit the circumstances in which\t the
\nservices  of an employee could be terminated by way of\tdis-
\ncharge\tsimpliciter and without holding enquiry.  These\t are
\neventualities  which  do not constitute misconduct  and\t yet
\nretention  of an employee in the service of  the  management
\nfor any one of the grounds mentioned in the said  Regulation
\nmight  be  considered as detrimental for the  management  or
\nagainst\t public\t interest. It was submitted  that  the\tsaid
\nregulation  48\thas to be read with Regulation\t44(A)  which
\nreads as under:\n<\/p>\n
“44(A)(i) Notwithstanding anything contained in these  Regu-
\nlations and if, in the opinion of the Corporation (the Board
\nof Directors of Air India), it is not possible or  practica-
\nble  to\t hold an enquiry under the  relevant  provisions  of
\nthese  Regulations, the Corporation may, if  satisfied\tthat
\nthe  employee has been guilty of any misconduct, any one  of
\nthe  punishment mentioned in Regulation 43 on  the  employee
\nconcerned.\n<\/p>\n
Provided  that before exercising his extra  ordinary  power,
\nthe  Board shall give 30 days prior notice to  the  employee
\nconcerned  of the act of misconduct that the reasons why  it
\nis not possible or practicable to hold an enquiry into\tsuch
\nmisconduct, and the punishment proposed by the Board and the
\nemployee shall be entitled to make a full written  represen-
\ntation to the Board in response to such notice.\n<\/p>\n
(ii) No action shall be taken under the Regulation until the
\nBoard  has taken into consideration the representation\tmade
\nby  the concerned employee under the proviso to Section\t (i)
\nwithin the notice period.”\n<\/p>\n
    The original regulation 44 was also modified.  According
\nto the interveners, the cumulative reading of regulation 48,
\nas  amended,  and regulation 44, as amended,  would  clearly
\nestablish  that the vice, if any, of arbitrariness  is\tcom-
\npletely removed and sufficient guidelines are
\n226<\/span>
\nmade  available\t to the Board of Directors to  exercise\t the
\nrestricted  and limited power now available to the  employer
\nunder these Regulations.\n<\/p>\n
    In C.M.P. No. 30309 of 1988, on behalf of the New  India
\nAssurance  Co., the intervention application was  filed.  It
\nwas  stated that in the courts below the writ  petition\t No.
\n835 of 1975 was filed by the employee challenging his termi-
\nnation and the appeal filed thereon were decided on  grounds
\navailable  to the petitioner at that time. A  special  leave
\npetition  was filed by the employee concerned which has\t now
\nbecome\tC.A.  No.  655 of 1984. After the  judgment  in\t the
\nCentral Inland Water’s case (supra), an additional ground is
\nnow being taken to contend that a contract entered into\t way
\nback  in  the  sixties when the employee  concerned  was  an
\nemployee  of the Orissa Cooperative Insurance Society  Ltd.,
\nCuttack\t could not be enforced now and the same ought to  be
\ndeclared  void\tin view of the Central Inland  Water’s\tcase
\n(supra).\n<\/p>\n
    The\t intervention was allowed on 24th January, 1990\t and
\nSmt.  Shyamla Pappu, Senior Advocate submitted written\tsub-
\nmissions.  It was submitted that adjudication on the  merits
\nand the consideration of the facts and circumstances of\t the
\ncase  may be left to the Bench hearing the matter after\t the
\ndecision of the question of law referred to the Constitution
\nBench.\n<\/p>\n
    In\tthis connection, it may, however, be noted that\t the
\nGeneral\t Insurance was nationaIised under the provisions  of
\nthe General Insurance Provisions (Nationalisation) Act, 1972
\nand  the said Act came into force on 20th  September,  1972.
\nPrior to this, General Insurance (Emergency Provisions) Act,
\n1971 was passed under the provisions of which Act all under-
\ntakings\t of  all Insurers vested in the\t Central  Government
\nwith effect from I3th May, 1971. This was pending nationali-
\nsation which took place in 1972 as aforesaid.
\n    Section  7(1)  of the said Act which  provided  for\t the
\ntakeover of former employees reads as under:
\n“Every\twhole-time officer or other employee of an  existing
\nInsurer\t other\tthan an Indian Insurance  Company,  who\t was
\nemployed by that insurer, wholly or mainly with his  general
\ninsurance  business  immediately before the  appointed\tday,
\nshall,\ton  the appointed day, become an  officer  or  other
\nemployee,  as the case may be, of the Insurance Company,  in
\nwhich the Undertaking to which the service of the officer
\n227<\/span>
\nor  other  employee relates has vested and  shall  hold\t his
\noffice or service on the same terms and conditions and\twith
\nthe  same rights to pension, gratuity and other\t matters  as
\nwould have been admissible to him if there had been no\tsuch
\nvesting and shall continue to do so until his employment  in
\nthe  Indian  Insurance Company in which the  undertaking  or
\npart  has vested, is terminated or until  his  remuneration,
\nterms and conditions are duly altered by that Indian  Insur-
\nance Company.”\n<\/p>\n
    The\t original terms and conditions had not been  altered
\nand  the  employees like the appellant in  C.A.\t No.  855\/84
\ncontinued  to be governed by the original terms\t and  condi-
\ntions of the contract at the time of termination. The origi-
\nnal terms and conditions of employment, therefore, continued
\nin force. The contract of service was entered into when\t the
\nappellant  joined the Orissa Cooperative  Insurance  Society
\nLtd.  way back in 196 1 and at the time of take-over by\t the
\nCentral\t Government was the Divisional Manager of  the\tsaid
\nsociety.  After the take over by the Central  Government  of
\ngeneral\t insurance in 1972, a great deal  of  reorganisation
\nhad to be effected in order to tone up the system of general
\ninsurance  which  had become unwieldy due  to  the  mushroom
\ngrowth\tof societies with no control whatsoever when  insur-
\nance was in private hands.\n<\/p>\n
    It\twas submitted by Smt. Shyamla Pappu that  there\t are
\nmany such cases where action was taken soon after nationali-
\nsation of general insurance in 1972. If such orders are\t set
\naside  today,  Smt. Shyamla Pappu posed the  question,\twhat
\nwould  be  the result? Would the order set  aside,  at\tthis
\nstage  give the employee a right to be reinstated’?  If\t the
\nanswer\tto  the\t above is in the affirmative,  would  it  be
\nconducive  to efficiency in the conduct of a public  utility
\nsuch  as general insurance, Smt. Pappu raised the  question.
\nWould it not hamper the Company’s business considering\tthat
\nthe reduction\/reorganisation of staff was essential for\t the
\neffective  functioning\tof the public  service?\t Smt.  Pappu
\nasked  the question would the public service not be  saddled
\nwith  unnecessary and\/or incompetent staff, thus,  burdening
\nthe public utility\/service with unmanageable costs and staff
\nthat is ineffective’? It was urged that the New India Assur-
\nance  Company had a clause, in the contract at the  relevant
\ntime, which was as follows:\n<\/p>\n
“in the event of the society not having any further need  of
\nany  employees\tservices, whether  permanent  or  temporary,
\nwhich shall be decided by the board, the Principal Officer
\n228<\/span>
\nshall give 30 days notice in writing for termination of\t his
\nservices or in lieu thereof pay such employee a sum  equiva-
\nlent to one month pay including allowance upto the period of
\nnotice.”\n<\/p>\n
    The\t above clause covered cases of retrenchment,  aboli-
\ntion of posts and other situations which had been adjudicat-
\ned  upon  by  this Court. If, however,\tthe  Central  Inland
\nWater’s case (supra) is applied, Smt. Shyamla Pappu  submit-
\nted, then the management of the Intervene r Company will  be
\npowerless even in a case of abolition of posts or  retrench-
\nment  or  any other allied situation. It is  seen  that\t the
\npower to terminate an employee is co-existent with the power
\nto appoint. Smt. Shyamla Pappu relied on the General Clauses
\nAct  and  submitted  that the Central  Inland  Water’s\tcase
\n(supra) was erroneous in so far as it made a complete  nega-
\ntion  of this power. Then, it was submitted by her  that  in
\ncase of an employer who had made all the necessary  investi-
\ngation\tand  the  employee concerned has  been\tfully  heard
\nbefore\tthe  order 01′ termination and if  the\tdecision  of
\nCentral\t Inland Water’s case was applied, then even  such  a
\ncase  would  be a case of illegal  termination,\t considering
\nthat there would be no power to terminate. It was  submitted
\nthat  the  Central Inland Water’s case had to be  read\tdown
\nbecause\t paras\t77,  92 and 93 of the report  take  in\teven
\nprivate\t employment. The sweep of the judgment\tcannot\thold
\ngood and had to be curtailed.\n<\/p>\n
    According  to Smt. Pappu, what then was the position  of
\nterminations effected when the law was different? It  cannot
\nbe  said that they are entitled to relief now. It should  be
\nclarified  that the judgment of this Court would apply\tpro-
\nspectively, it was submitted. Past cases might be treated as
\nconcluded  in  view of the law prevailing at that  time\t and
\nalso in view of the contentions urged by the parties in\t the
\ncourts\tbelow  at various stages. In the event,\t this  Court
\ncomes to the conclusion that even old cases would be covered
\nby the judgment now rendered, the orders already passed\t may
\nbe upheld and a post-decisional hearing might be directed so
\nthat the management concerned has the opportunity of showing
\nthat  there existed good reasons for termination though\t the
\nsame were not communicated to the employee concerned because
\nthe law then existing did not require such a  communication.
\nIn the interest of justice, we should allow such a course.
\n    In the light of the provisions and in the facts and\t the
\ncircumstances  of the case, it is, therefore,  necessary  to
\nconsider the validity of the power of termination of employ-
\nment by the employers or authorities of the employees  with-
\nout holding any enquiry in the circum-\n<\/p>\n
229<\/span><\/p>\n
stances noted in the several civil appeals and\tapplications
\nherein.\n<\/p>\n
    In\tthese civil appeals. the question of actual user  of
\npower is not the main issue. but the validity of clauses  or
\nregulations containing the aforesaid power. The instances of
\nactual user of power, however, are not wholly irrelevant  on
\nthe question of the validity or extent of the power  because
\nthese  explain the extent and content of power and\/or  occa-
\nsion  for  such user. Firstly. we have to. in  view  of\t the
\nfacts and the circumstances of the Civil Appeal No. 2876  of
\n1986,  consider the amplitude of the power under clause\t (b)
\nof Regulation 9 of the Regulations concerned. We have  noted
\nthe  contents  of that Regulation. We have  also  noted\t the
\namplitude  of the expression of that power as was  canvassed
\nbefore\tthe  High Court in the matter under  appeal  and  as
\nnoticed\t by  the decision of this Court in  Delhi  Transport
\nUndertaking v. Balbir Saran Goel’s<\/a> case (supra). A survey of
\nthe  several authorities of law and the development  of\t law
\nfrom time to time would lead one to the conclusion that\t the
\nphilosophy  of the Indian Constitution, as it  has  evolved,
\nfrom precedent to precedent. has broaden the horizons of the
\nright  of the employees and they have been assured  security
\nof tenures and ensured protection against arbitrariness\t and
\ndiscrimination\tin discharge or termination of\this  employ-
\nment.  This is the basic concept of the evolution  from\t the
\ndifferent  angles  of law of master and servant\t or  in\t the
\nevolution of employer and employee relationship. It is\ttrue
\nthat.  the law has travelled in different channels,  govern-
\nment servants or servants or employees having status have to
\nbe differentiated from those whose relationships are  guided
\nby contractual obligations.\n<\/p>\n
    But it has to be borne in mind that we are concerned  in
\nthese  matters with the employees either of  semi-Government
\nor  statutory corporations or public undertakings who  enjoy
\nthe  rights.  privileges.  limitations\tand  inhibitions  of
\ninstitutions who come within the ambit of Article 12 of\t the
\nConstitution.  It is in the background of  these  parameters
\nthat we must consider the question essentially and basically
\nposed in these matters. The basic and the fundamental  ques-
\ntion to be judged is. in what manner and to what extent, the
\nemployees  of these bodies or corporations  or\tinstitutions
\ncould be affected in their security of tenure by the employ-
\ners  consistent with the rights evolved over the  years\t and
\nrights emanating from the philosophy of the Constitution  as
\nat present understood and accepted.\n<\/p>\n
    We have noted the exhaustive and the learned analysis of
\nthe background of the diverse facts projected in the several
\ncases and appeals before us.\n<\/p>\n
230<\/span><\/p>\n
Efficiency  of the administration of these  undertakings  is
\nvery  relevant\tconsideration.\tProduction  must   continue,
\nservices  must be maintained and run. Efficacy of the  serv-
\nices can be manned by the disciplined employees or  workers.
\nDiscipline,  decency and order will have to  be\t maintained.
\nEmployees should have sense of participation and involvement
\nand  necessarily  sense\t of security  in  semi-permanent  or
\nquasi-permanent or permanent employment. There must be scope
\nfor encouragement for good work. In what manner and in\twhat
\nmeasure.  this\tshould\tbe planned and\tensured\t within\t the
\nframework of the Constitution and, power mingled with  obli-
\ngations,  and  duties enjoined with rights, are\t matters  of
\nconstitutional adjustment at any particular evolved stage of
\nthe philosophy of our Constitution.\n<\/p>\n
    We have noted several decisions, numerous as these\tare,
\nand the diverse facts, as we have found. We have noted\tthat
\nin  some cases arbitrary action or whimsical action or\tdis-
\ncriminatory  action can flow or follow by the  preponderance
\nof these powers. The fact that the power so entrusted with a
\nhigh ranking authority or body is not always a safe or sound
\ninsurance  against  misuse.  At least, it  does\t not  always
\nensure against erosion of credibility in the exercise of the
\npower  in particular contingency. Yet, discipline has to  be
\nmaintained, efficiency of the institution has to be ensured.
\nIt  has to be recognised that quick actions are\t very  often
\nnecessary in running of an institution or public service  or
\npublic utility and public concern. It is not always possible
\nto have enquiry because disclosure is difficult; evidence is
\nhesitant  and difficult, often impossible. In those  circum-
\nstances,  what\tshould be the approach to  the\tlocation  of
\npower  and what should be the content and extent  of  power,
\npossession and exercise of which is essential for  efficient
\nrunning\t of  the  industries or services’? It has  to  be  a
\nmatter\tboth  of balancing and adjustment on which  one\t can
\nwager the salvation of rights and liberties of the employees
\nconcerned  and the future of the industries or the  services
\ninvolved.\n<\/p>\n
    Bearing in mind the aforesaid principles and objects, it
\nappears to us that the power to terminate the employment  of
\npermanent employment must be there. Efficiency and expedien-
\ncy and the necessity of running an industry or service\tmake
\nit imperative to have these powers. Power must,\t therefore,.
\nwith  authorities to take decision quickly, objectively\t and
\nindependently. Power must be assumed with certain conditions
\nof  duty. The preamble, the policy, purpose of the  enacting
\nprovision delimit the occasions or the contingencies for the
\nneed  for the exercise of the power and these  should  limit
\nthe occasions
\n231<\/span>
\nof  exercise of such powers. The manner in which such  exer-
\ncise  of power should be made should ensure fairness,  avoid
\narbitrariness  and mala fide and create credibility  in\t the
\ndecisions arrived at or by exercise of the power. All  these
\nare  essential to ensure that power is fairly exercised\t and
\nthere is fair play in action. Reasons, good and sound,\tmust
\ncontrol the exercise of power.\n<\/p>\n
    We\thave noted the rival submissions.  Learned  Attorney
\nGeneral\t of  India  and the learned  Solicitor\tGeneral\t and
\nothers\tappearing those who sought for sustaining the  power
\nby the employers or the authorities, contend that for  effi-
\nciency\tof  the\t industry, for the attainment  of  the\tvery
\npurpose for which institutions are created, there should  be
\npower  to terminate the employment- of undesirable,  ineffi-
\ncient,\tcorrupt,  indolent, disobedient employees  in  those
\ncases where holding of enquiry or prolonging these employees
\nfor  that purpose would be detrimental, difficult and  frus-
\ntrating.  It is in this context that we should\texamine\t the
\npower under the aforesaid Regulation 9(b). The power must be
\nthere,\tthe power must be utilised by person  or  authority,
\nhigh  ranking enough or senior enough who can be trusted  or
\nwho  can be presumed to be able to act\tfairly,\t objectively
\nand  independently.  The occasion for the  exercise  of\t the
\npower must be delimited with precision, clarity or objectiv-
\nity.  And those occasions must be correlated to the  purpose
\nfor which the powers are sought to be exercised. In concrete
\nterms,\tfor  the  running of the industry  or  the  service,
\nefficiently,  quickly  and in a better manner  or  to  avoid
\ndeadlocks  or inefficiency or friction, the vesting  of\t the
\npower in circumstances must be such that will evoke credita-
\nbility\tand confidence. Reasons must be there, reasons\tmust
\nbe  perspectable, reasons must be relevant and\tthe  reasons
\nmust  be of authority independently, fairly and\t objectively
\narrived at.\n<\/p>\n
    Notice  of hearing may or may not be given,\t opportunity
\nin  the\t form of an enquiry may or not be given,  yet  arbi-
\ntrariness and discrimination and acting whimsically must  be
\navoided.  These power must, therefore, be so read  that\t the
\npowers\tcan be exercised on reasons, reasons should  be\t re-
\ncorded, reasons need not always be communicated, must be  by
\nauthorities who are competent and are expected to act  fair-
\nly, objectively and independently. The occasion for the\t use
\nof power must be clearly circumscribed in the above  limits.
\nThese  must also circumscribe that the need for exercise  of
\nthose power without holding a detailed or prolonged  enquiry
\nis there.\n<\/p>\n
As we have noted, a good deal of controversy was that these
\n232<\/span>
\ninhibitions  or limitations or conditions are not  there  in
\nthe  amplitude\tor  the extent of the  power  enumerated  or
\nstated\tin  Regulation\t9(b) of\t the  aforesaid\t Regulations
\nconcerned or of similar provisions that we have examined  in
\nthese cases.\n<\/p>\n
    We have noted the argument, learned and interesting,  on
\nthe question of judicial law making imputing to the legisla-
\ntures what these have not articulated. Should the courts say
\nor  can\t say what the legislatures have not said’?  We\thave
\nnoted  the controversy of how should legislation of  limited
\nlegislatures, Parliaments or rule making bodies, who are not
\nexpected or enjoined to make rules or laws contrary to or in
\nderogation  or the constitutional prohibitions\tand  inhibi-
\ntions be read. We have been tempted to read down in the path
\nof  judicial law making on the plea that  legislature  could
\nnot  have  intended  to give powers to\tthe  authorities  or
\nemployers which would be violative of fundamental rights  of
\nthe  persons involved in the exercise of those\tpowers\tand,
\ntherefore,  should be attributed those powers on  conditions
\nwhich  will only make these legal or valid. Our\t law  making
\nbodies are not law into themselves and cannot create or make
\nall  laws. They can only confer powers or make laws for\t the
\nconferment  of\tpowers on authorities which  are  legal\t and
\nvalid.\tSuch powers conferred must conform to  the  consitu-
\ntional\tinhibitions.  The  question,  therefore,  is–is  it
\npossible or desirable to read down the power conferred under
\nRegulation  9(b) or similar regulations permitting  employer
\nor the authority to terminate the employment of the  employ-
\nees  by\t giving reasonable notice or pay in lieu  of  notice
\nwithout\t holding  enquiry with the conditions  indicated  or
\nmentioned  hereinbefore?  Will it or will it not  amount  to
\nmaking\tlaws  of stating which the legislature\tor  the\t law
\nmaking body has not stated?\n<\/p>\n
    We have been reminded that judges should not make  laws.
\nBut  the  question  is–can the judges\tarticulate  what  is
\ninarticulate and what can be reasonably and plainly found to
\nbe  inherent on the presumption that a legislature or a\t law
\nmaking body with the limited authority would act only within
\nlimitations  so as to make the legislation or law valid\t and
\nthe legislature must be presumed to act with certain  amount
\nof  knowledge and fairness protecting the rights  of  people
\nconcerned and aiming at fairness in action?\n<\/p>\n
    We\thave noted the rival contentions. We have noted\t the
\nsubmission that Mr. Garg, Mr. Ramamurthi and others  invited
\nus not to read down and against legislating positively\twith
\nconditions. But the question is–are those conditions  which
\nwe are invited to attribute to
\n233<\/span>
\nthe  legislature  or the law making bodies  contrary  to  or
\nagainst the manifest intention of the legislature?\n<\/p>\n
    Legislation,  both\tstatutory  and\tconstitutional,\t  is
\nenacted,  it  is  true, from experience of  evils.  But\t its
\ngeneral\t language  should  not,\t therefore,  necessarily  be
\nconfined  to  the  form\t that evil  had\t taken.\t Time  works
\nchanges,  brings into existence new conditions and  purposes
\nand new awareness of limitations. Therefore, a principle  to
\nbe  valid  must\t be capable of wider  application  than\t the
\nmischief  which gave it birth. This is particularly true  of
\nthe  constitutional  constructions.  Constitutions  are\t not
\nephemeral  enactments  designed to meet\t passing  occasions.
\nThese  are,  to\t use the words of  Chief  Justice  Marshall,
\n“designed to approach immortality as nearly as human  insti-
\ntutions\t can approach it  …..\t “. In the application of  a
\nConstitutional limitation or inhibition, our  interpretation
\ncannot be only of ‘what has been’ but of ‘what may be’.\t See
\nthe  observations  of  this Court in Sunil  Batra  v.  Delhi
\nAdministration<\/a> (supra). Where, therefore, in the interpreta-
\ntion  of  the provisions of an Act,  two  constructions\t are
\npossible,  one which leads towards constitutionality of\t the
\nlegislation would be preferred to that which has the  effect
\nof  destroying it. If we do not read the conferment  of\t the
\npower  in the manner we have envisaged before, the power  is
\nliable\tto be struck down as bad. This, we say in  spite  of
\nthe argument by many including learned Solicitor General  of
\nIndia and Smt. Shyamla Pappu that in contractual obligations
\nwhile institutions or organisations or authorities, who come
\nwithin the arebit of Article 12 of the Constitution are free
\nto  contract on the basis of ‘hire and fire’ and the  theory
\nof  the concept of unequal bargain and the  power  conferred
\nsubject to constitutional limitations would not be  applica-
\nble.  We are not impressed and not agreeable to accept\tthat
\nproposition at this stage of the evolution of the  constitu-
\ntional philosophy of master and servant framework or if\t you
\nwould  like  to call it employer or  employee  relationship.
\nTherefore,  these conferments of the powers on the  employer
\nmust  be  judged  on the constitutional peg  and  so  judged
\nwithout\t the limitations indicated aforesaid, the  power  is
\nliable to be considered as arbitrary and struck down.
\n    Whenever  a statute comes up for consideration, it\tmust
\nbe remembered that it is not within human powers to ,foresee
\nthe manifold sets of facts which may arise, and, even if  it
\nwere,  it is not possible to provide for them in terms\tfree
\nfrom  all  ambiguity.  The English language,  and  for\tthat
\nmatter\tany language in use today, is not an  instrument  of
\nmathematical precision. It has been said that our literature
\nwould have been much the poorer if it were.Leaving, how-\n<\/p>\n
234<\/span><\/p>\n
ever. the question of richness or poverty of our  literature
\napart,\twe  must proceed on the assumption that\t human\tmind
\ncannot foresee everything. It has, therefore, been said that
\nwhen  a question arises whether the power has been  properly
\nconferred and even if so, the extent of it. Lord Denning has
\nopined\tthat a Judge in such a situation cannot simply\tfold
\nhis hand and blame the draftsmen and look for new enactment.
\nLord  Denning invites us to set to work on the\tconstruction
\ntask  of finding the intention of the Parliament or the\t law
\nmaking body and we must. however. do this not only from\t the
\nlanguage of the statute. because. as we have seen.  language
\nis an imperfect medium and very often thoughts are  perpetu-
\nally in search of ‘broken language’. But the judge must also
\ndo  it from a consideration of the social  conditions  which
\ngive  rise to it, and o[ the mischief which it was  intended
\nto remedy and also in the light of the constitutional  inhi-
\nbitions\t and then supplant the written words and add  to  it
\nend  give ‘force and life’ to the intention and\t purpose  of
\nthe  legislature or the law making authority. A\t judge\tmust
\nnot  alter the material of which a law or an  instrument  is
\nwoven, but he can and should iron out the creases and if one
\nmay venture to say, make articulate the inarticulate premise
\nbut make articulate only which follow from necessary compul-
\nsions of the situations and the constitutional position. See
\nin this connection the observations of Lord Denning in\t“The
\nDiscipline of Law” at p. 12.\n<\/p>\n
    It is true that judicial jealously of legislature in law
\nmaking\thas long been outdrawn, but the strict\tconstruction
\nremains still an established rule. It is generally  accepted
\nprinciple that judges in interpreting statutes, should\tgive
\neffect\tto the legislators’ intent. By doing so. the  courts
\ndo recognise their subordinate position and their obligation
\nto help the legislature to achieve its purpose. But in\tthat
\neffort. creativity is essential. There have been differences
\nof  opinion on the practices that the courts may  employ  in
\nattempting to discover the legislative intent. In the begin-
\nning, conventional practice was only to look to the words of
\nthe statutes. Now the entire spectrum has to be examined. It
\nhas been said that judges are not unfettered glossators.\n<\/p>\n
     is\t true that there is no actual expression  used\tena-
\nbling the legislation or the statute in question  indicating
\nthe  limitations  or conditions as aforesaid.  But  it\tmust
\nproceed on the premise that the law making authority intend-
\ned to make a valid law to confer power validly or which will
\nbe  valid. The freedom, therefore, to search the  spirit  of
\nthe  enactment or what is intended to obtain or to find\t the
\nintention  of  the Parliament gives the Court the  power  to
\nsupplant and supplement the expressions used to say what was
\nleft unsaid. This is a power which
\n235<\/span>
\nis an important branch of judicial power, the concession  of
\nwhich  if taken to the extreme is dangerous, but  denial  of
\nthat power would be ruinous and this is not contrary to\t the
\nexpressed  intention of the legislature or the implied\tpur-
\npose of the legislation. It was not as Shri Ramamurthi tried
\nto argue that legislature wanted to give an uncontrolled and
\nabsolute  power\t to discharge employees on the part  of\t the
\nemployers  without  any enquiry in all\tcircumstances.\tThat
\ncannot be and that was not intended to be as can be  implied
\nfrom all the circumstances.\n<\/p>\n
    In the aforesaid view of the matter, I would sustain the
\nconstitutionality  of  this conferment of power\t by  reading
\nthat the power must be exercised on reasons relevant for the
\nefficient  running of the services or performing of the\t job
\nby the societies or the bodies. It should be done objective-
\nly,  the reasons should be recorded, it should\trecord\tthis
\nand the basis that it is not feasible or possible reasonably
\nto hold any enquiry without disclosing the evidence which in
\nthe circumstances of the case would be hampering the running
\nof the institution. The reasons should be recorded, it\tneed
\nnot be communicated and only for the purpose of the  running
\nof the institution, there should be factors which hamper the
\nrunning\t of the institution without the termination  of\t the
\nemployment of the employee concerned at that particular time
\neither because he is a surplus, inefficient, disobedient and
\ndangerous.\n<\/p>\n
    Construction  or interpretation of legislative  or\trule
\nprovisions proceeds on the assumption that courts must\tseek
\nto  discover and translate the intention of the\t legislature
\nor  the rule-making body. This is one of the legal  fictions
\nupon  the hypothesis of which the framework of\tadjudication
\nof the intention of a piece of legislation or rule proceeds.
\nBut  these are fictional myths to a large extent as  experi-
\nence should tell us. In most of the cases legislature,\tthat
\nis  to say, vast majority of the people who are supposed  to
\nrepresent the views and opinions of the people, do not\thave
\nany  intention,\t even if they have, they cannot and  do\t not
\narticulate  those intentions. On most of these issues  their
\nis  no comprehension or understanding. Reality would  reveal
\nthat  it  is only those who are able to\t exert\ttheir  view-
\npoints,\t in a common parliamentary jargon, the power  lobby,
\ngets  what it wants, and the machinery is of a\tbureaucratic
\nset up who draft the legislation or rule or law. So,  there-
\nfore, what is passed on very often as the will of the people
\nin a particular enactment is the handy work of a bureaucrat-
\nic machine produced at the behest of a power lobby  control-
\nling the corridors of power in a particular situation.\tThis
\ntakes the mythetical
\n236<\/span>
\nshape of the ‘intention of the people’ in the form of legis-
\nlation.\t Again, very often, the bureaucratic machine is\t not
\nable  to correctly and properly transmute what was  intended
\nto  be\tconveyed. In such a situation, is it or\t is  it\t not
\nbetter,\t one would ponder to ask, whether the courts  should
\nattribute to the law-making body the knowledge of the values
\nand  limitations of the Constitution, and knowledge  of\t the
\nevils that should be remedied at a particular time and in  a
\nsituation that should be met by a particular piece of legis-
\nlation,\t and the court with the experience and knowledge  of
\nlaw, with the assistance of lawyers trained in this  behalf,
\nshould\tendeavour to find out what will be the\tcorrect\t and
\nappropriate solution, and construe the rule of the  legisla-
\ntion within the ambit of constitutional limitations and upon
\nreasonable  judgment of what should have been expressed.  In
\nreality,  that happens in most of the cases. Can it be\tcon-
\ndemned as judicial usurpation of law-making functions of the
\nlegislature  thereby depriving the people of their right  to
\nexpress their will? This is a practical dilemma which Judges
\nmust  always, in cases of interpretation  and  construction,
\nface and a question which they must answer.\n<\/p>\n
    I  have  noted the guidelines for the  exercise  of\t the
\npower,\tpreamble, relevant sections from which\tthe  reasons
\nshould\tbe inferred and recorded, although they need not  be
\ncommunicate.  These  should be recorded in order  to  ensure
\neffective  judicial  review  in a  given  case.\t Termination
\nsimpliciter  under Regulation 9(b) or similar powers can  be
\nexercised only in circumstances other than those in  regula-
\ntion  9(a).  The  exercise of such powers can  only  be\t for
\npurposes  germane  and relevant to the\tstatute.  There\t are
\nseveral\t illustrations\tof  that, namely,  the\temployee  is
\nincompetent  or unsuitable so as to make his continuance  in
\nthe  employment detrimental to the interest of the  institu-
\ntion,  where  the  continuance of the employee\tis  a  grave
\nsecurity  risk\tmaking his continuance\tdetrimental  to\t the
\ninterest of the Corporation and where because of the conduct
\nof the employee, there is lack of confidence in the employee
\nwhich makes it necessary in the interest of the\t Corporation
\nto  immediately\t terminate  the services  of  the  employee.
\nThese, however, are illustrative and not exhaustive.  There-
\nfore,  each  case of the conferment of\tthe  power  involved
\nshould be decided on the aforesaid basis.\n<\/p>\n
    I  am conscious that clear intention as indicated  in  a
\nlegislation  cannot be permitted to be defeated by means  of
\nconstruction.  It has been said that if the legislature\t has
\nmanifested a clear intention to exercise an unlimited power,
\nit is impermissible to read down the amplitude of that power
\nso as to make it limited. I do not agree. Our
\n237<\/span>
\nlegislatures  are limited by the constitutional\t inhibitions
\nand  it\t is time, in my opinion, that we should\t read  their
\nActs and enactments with the attribute that they know  their
\nlimits and could not have intended to violate the  Constitu-
\ntion. It is true that where there are clear, unambiguous and
\npositive  terms in a legislation, the Court should be  loath
\nto  read  down. It should proceed  with\t a  straight-forward
\nmethod\tof  striking down such legislations. But  where\t the
\nstatute\t is  silent or not expressive or  inarticulate,\t the
\nCourt  must read down in the silence of the statute  and  in
\nthe  inarticulation  of its provisions,\t the  constitutional
\ninhibitions  and  transmute the major  inarticulate  premise
\ninto a reality and read down the statute accordingly. It  is
\ntrue  perhaps,\tas  has been said, that in  the\t history  of
\nconstitutional\tlaw, statutes are seldom read down  to\tmean
\nwhat they say and intend. It is begging the question. If the
\nstatutes  are  seldom read down to mean what  they  say\t and
\nintend. It is begging the question. If the statute does\t not
\nspecifically  say,  in such circumstances, as to how  do  we
\nfind the intention to transgress the constitutional  limita-
\ntions.\tAt  least, the relevant provisions of  the  relevant
\nstatutes  and the rules, mentioned hereinbefore, are, in  my
\nopinion, on these points, not expressive enough to betray an
\nintention transgress constitutional limitations. I am afraid
\nthat reference to Elliott Ashton Welsh, II v. United States,
\n398  US 333; 26 L.Ed. 2d 308 is inept in the  background  of
\nthe  principles we are confronted with. The plain thrust  of
\nlegislative  enactment has to be found out in the  inarticu-
\nlate  expressions and in the silence of the legislation.  In
\ndoing  so, to say what the legislature did not\tspecifically
\nsay,  is not distortion to avert any  constitutional  colli-
\nsion, In the language of the relevant provisions with  which
\nwe  are\t confronted,  I do not find that  intention  of\t the
\nlegislature to flout the constitutional limitations.
\n    I am also unable to accept the contention of Mr. Garg as
\nwell  as Mr. Ramamurthi that it is clear as a result of\t the
\nconstitutional\tposition  of the security of tenure  of\t the
\nemployees  as well as the expressed language of\t the  provi-
\nsions of several enactments that there is no valid power  of
\nthe  termination  of employment of the\tpermanent  employees
\nwithout\t holding an enquiry or giving an opportunity to\t the
\nemployees to rebut the charges on the grounds of termination
\nin all circumstances. It was contended, as I have noted,  by
\nShri R.K. Garg that no principle of interpretation permitted
\nreading\t down a provision so as to make it into a  different
\nprovision altogether different from what was intended by the
\nlegislature  or\t its  delegate. Reference was  made  to\t the
\ndecision  of  this Court in R.M.D.C. ‘s case (supra).  I  am
\nunable to accept this contention. It is not that the reading
\ndown is used for a purpose which is just the opposite  which
\nthe legislature had intended.\n<\/p>\n
238<\/span><\/p>\n
Legislature  had not intended arbitrary or  uncontrolled  or
\nwhimsical  power.  Indeed  it considered. This\tis  not\t the
\nproper\tway to read that power in the said Regulation  9(b).
\nPara  522 of the Shastri Award, read properly, must be\tcir-
\ncumscribed  with the conditions indicated above as a  neces-
\nsary corollary or consequence of that power. It is also\t not
\nreading\t to the legislature conditions which were not  there
\nin the second proviso Article 311(2) of the Constitution. In
\nview  of the ratio of the five-judge Bench decision of\tthis
\nCourt in Tulsiram’s case (supra), which had examined all the
\nrelevant decisions, I am unable to accept the submission  of
\nShri  R.K. Garg and Mr. Ramamurthi. Absolute powers,  it  is
\ntrue,  cannot  be regulated  without  essential\t legislative
\npolicy,\t but  here  properly read, absolute  power  was\t not
\nthere.\tPower  that was only  constitutionally\tvalid,\tthat
\npower  can be presumed to have been given and if  that\tpre-
\nsumption  is  made, conditions\tindicated  above  inevitably
\nattach.\n<\/p>\n
    We\tare  not concerned with the  concept  of  industrial
\ndemocracy sought to be propounded by Mr. Garg in this  case.
\nThe validity and the propriety of having industrial democra-
\ncy  is not in issue. What is in issue is  demonstrable\tfair
\nplay and justice, as sought for by Mr. Garg, in the exercise
\nof  the\t power which must be conceded as  an  essential\t at-
\ntribute for proper functioning of the institution.
\n    It is true that no drafts as such have been submitted by
\nthe  learned  Attorney General or by the  learned  Solicitor
\nGeneral nor by any counsel appearing for the management. But
\nthese conditions, which we have noted, are necessary  corol-
\nlary flowing from the conferment of the power of termination
\nin a constitutional manner for the smooth, proper and  effi-
\ncient running of the industry.\n<\/p>\n
    In\tthe  aforesaid view of the matter, 1  am  unable  to
\naccept\tthe submissions of Mr. Garg and Mr. Ramamurthi.\t The
\npower  must  be there, the power must be read  down  in\t the
\nmanner and to the extent indicated above, in my opinion,  of
\nterminating  the  services of  permanent  employees  without
\nholding\t any  enquiry in the stated contingencies  and\tthis
\nwould  be by either virtue of the silence of  the  provision
\nindicating the contingencies of termination or by virtue  of
\nconstitutional\tinhibitions. That reading would not  violate
\nthe theory that judges should not make laws.
\n    In\tthe  aforesaid\tview of the matter,  I\tdirect\tthat
\nwhenever question of exercise of the power of termination of
\npermanent employees by reasonable notice without holding any
\nenquiry arises, the extent of
\n239<\/span>
\nthe  power should be read in the manner indicated above\t and
\nwe  reiterate  that  such powers can be\t exercised  for\t the
\npurposes of the Act which will be determinable by the pream-
\nble  and by relevant enacting provisions and the  contingen-
\ncies  for  the exercise of the power must be  specified\t and
\npowers should be exercised by authority competent and  inde-
\npendent\t enough and should be articulated by reasons  stated
\neven if not communicated. These are the limitations inherent
\nand  latent  in the framework of our  Constitution  and\t the
\npower with these limitations is valid.\n<\/p>\n
    Having  regard  to the aforesaid view, I  will  have  to
\ndispose of the appeals in terms of the aforesaid principles.
\n    Next the question arises–what would be the position  of
\nthe  rights  and liabilities determined as  anterior  to  or
\nbefore our reading these powers to be conditioned as  afore-
\nsaid.  Having regard to the finality of the position of\t law
\nand  having regard to the theory that parties have  adjusted
\ntheir  rights on the understanding of the law as it was,  in
\nour  opinion,  justice of the situation would be met  if  we
\ndeclare and hold that pending litigations should be examined
\nin  the light of the aforesaid principles and dispose of  in
\nthe  aforesaid\tlight, namely, where issues  of\t damages  or
\nconsequences  of  termination by virtue of exercise  of\t the
\npower  are still pending adjudication in any forum and\thave
\nnot been finally adjudicated, these should be re-examined by
\nthe  appropriate  authorities before whom these\t issues\t are
\npending\t in the light of these principles, that is say,\t the
\nexercise  of the power should be judged on these  conditions
\nand  in\t the light of those conditions. If in the  light  of
\nthese  conditions, the exercise of the power is\t valid,\t the
\ntermination  should  be held to be valid, if  on  the  other
\nhand,  there  was  exercise without  compliance\t with  these
\nconditions,  the  termination would be\tinvalid\t and  conse-
\nquences\t in law of damages or reinstatement or\tothers\twill
\nfollow. But previous terminations where the lis is no longer
\npending\t before any authority will not be reopened. To\tthat
\nextent. I will declare this to be the law prospectively.
\n    I had, after circulating the draft judgment herein,\t the
\nadvantage  of the views of my learned brothers. They do\t not
\nagree with me. With respect. I am definitely of the  opinion
\nthat  time has come for the judicial interpretation to\tplay
\nfar  more active, creative and purposeful role\tin  deciding
\nwhat  is “according to law”. Law as evolved in India  today,
\nin my opinion, makes the limitations on user of power  quite
\nclear and distinct, in this branch. These are constitutional
\nlimitations.  Therefore, every provision in any\t legislation
\nby limited legislatures, in
\n240<\/span>
\nmy opinion, should be judged bearing in mind that the legis-
\nlature\tand  the law-making authorities were aware  and\t are
\nbound by these constitutional limitations. These inhibitions
\nmust  be  read\tinto these provisions so  that\tlaw  becomes
\neffective, purposeful and legal. In that view of the matter,
\nI am of the opinion that we should approach the question  of
\nconstitutional limitations or inhibitions in our interpreta-
\ntion  in deciding in each individual cases by not ‘what\t has
\nbeen’  but  ‘what may be’. This is the role and\t purpose  of
\nconstitutional\tinterpretation\tby  the apex  Court  of\t the
\ncountry. I know that this view of mine is not shared in this
\ndecision by my learned brothers. I respect their views,\t but
\nI  would like to hope that one day or the other\t this  Court
\nwould  be mature enough to fulfil what is purposeful  and  I
\nbelieve\t to  be the true role and purpose of  the  Court  in
\ninterpretation\tin the light of constitutional\tinhibitions.
\nHaving\thad the advantage of the views of my learned  broth-
\ners,  I\t regret, with respect, I cannot join them  in  their
\nviews.\tI am the loser for the same, but I will fondly\thope
\nonly for the time being.\n<\/p>\n
    I  believe that we must do away with ‘the childish\tfic-
\ntion’  that law is not made by the judiciary. Austin in\t his
\nJurisprudent  at page 65, 4th edn. has described the  BIack-
\nstone’s\t principle of finding the law as ‘the childish\tfic-
\ntion’. Chief Justice K. Subba Rao in I.C. Golak Nath &\tOrs.
\nv.  State of Punjab & Ant’., [1967] 2 SCR 762 at p. 811\t has
\nreferred to these observations. This Court under Article  14
\n1  of the Constitution is enjoined to declare law.  The\t ex-
\npression ‘declared’ is wider than the words ‘found or made’.
\nTo  declare is to announce opinion. Indeed, the\t latter\t in-
\nvolves\tthe  process,  while the  former  expresses  result.
\nInterpretation, ascertainment and evolution are parts of the
\nprocess,  while that interpreted, ascertained or evolved  is
\ndeclared  as law. The law declared by this Court is the\t law
\nof  the land. To deny this power to this Court on the  basis
\nof  some outmoded theory that the Court only finds  law\t but
\ndoes  not make it, is to make ineffective the  powerful\t in-
\nstrument  of  justice  placed in the hands  of\tthe  highest
\njudiciary  of  this country. See the observations  of  Chief
\nJustice K. Subba Rao in 1. C. Golak Nath & Ors’. v. State of
\nPunjab\t& Anr., (supra at pp. 813\/14). I  would,  therefore,
\nplead for a more active and creative role for the courts  in
\ndeclaring what the law is.\n<\/p>\n
    In\tthe  aforesaid light, in Civil Appeal  No.  2876  of
\n1986,  having regard to the facts and the circumstances\t and
\nthe attitude taken by the Delhi Transport Corporation, I  do
\nnot  interfere with the order of the High Court. The  appeal
\nshall, therefore, fail.\n<\/p>\n
241<\/span><\/p>\n
     Having regard to the facts and the circumstances and the
\nobservations  above.  Civil  Appeal No. 655  of\t 1984  (M.L.
\nKamra v. Chairman-cum-Managing Director, New India Assurance
\nCo.<\/a>  ) will be placed before a division bench of this  Court
\nto  be disposed of in accordance with law and the  light  of
\nthe observations made herein.\n<\/p>\n
    For\t the reasons that I have indicated above,  in  Civil
\nAppeal\tNo.  1115 of 1976 (Satnam Singh\t v.  Zilla  Parishad
\nFerozepur & Anr., ), with the facts herein where  apparently
\nno  reasons were recorded, the appeal of Satnam\t Singh\tsuc-
\nceeds  and in the interest of justice, the  monetary  relief
\nshould\tbe  given to the appellant which  is  quantified  at
\nRs.4,83,061.90\tpaise (Rupees four lakhs eighty three  thou-
\nsand  and  sixty  one and ninety paise).  I  have  indicated
\nbefore the basis on which this quantification has been made.
\n    For the same reasons, Civil Appeal No. 4073(NL) of\t1986
\n(Mahesh Kumar Giroti v. Regional Manager, Region 11, Region-
\nal  Office,  State Bank of India, Bareilly  &  Ors.),  Civil
\nAppeal\tNo. 331 of 1987 (The Delhi Transport  Corporation  &
\nAnr.  v. Shri Hans Raj), Civil Appeal No. 328 of  1987\t(The
\nDelhi  Transport Corporation & Anr. v. Shri Rohtash  Singh),
\nSpecial\t Leave Petition No.<\/a> 75 12 of 1987  (Delhi  Transport
\nCorporation   v.  Shri\tMohinder Singh &  Anr.),  and  Civil
\nAppeal\tNo.<\/a> 330 of 1987 (The Delhi Transport  Corporation  &
\nAnr.  v. Shri Prem Singh)<\/a> should be placed before the  divi-
\nsion  bench  of this Court to be disposed of  in  accordance
\nwith  the  observations made herein and in  accordance\twith
\nlaw. The appeals I would dispose of accordingly.
\n    Intervention of the parties are allowed and the  C.M.Ps.
\nare disposed of in the aforesaid terms.\n<\/p>\n
    RAY,  J.  I have had the privilege\tof  deciphering\t the
\njudgment  rendered  by\tthe learned Chief  Justice.  As\t the
\nquestion involved in these groups of appeals for decision is
\nvery  important, it is deemed necessary to express my  views
\non this important matter.\n<\/p>\n
    The\t pivotal question which arises for consideration  is
\nwhether\t Regulation  9(b) of the  Regulations  framed  under
\nsection\t 53  of\t the Delhi Road Transport  Act,\t 1950  which
\nprovides for termination of services of permanent  employees
\non  giving simply one month’s notice or pay in lieu  thereof
\nwithout\t recording  any\t reason therefore in  the  order  of
\ntermination is arbitrary, illegal, discriminatory and viola-
\ntive  of  Audi Alteram Partern Rule and\t so  constitutionaly
\ninvalid and void. It is
\n242<\/span>
\nalso necessary to consider in this respect whether the\tsaid
\nRule 9(b) can be interpreted and read down in such a  manner
\nto  hold  that it was not discriminatory nor  arbitrary\t nor
\ndoes it confer unbridled and uncanalised power on the trans-
\nport  authority to, terminate, however, the services of\t any
\nemployee  including  permanent employee without\t any  reason
\nwhatsoever  by\tthe Delhi State Transport Authority.  It  is
\nalso  necessary\t to  consider whether such a  power  can  be
\nexercised  without conforming to the fundamental  right\t em-
\nbodied\tin  the Article 14 as interpreted by this  Court  in
\nE.P. Royappa’s case that arbitrariness is the anti-thesis of
\nequality  enshrined  in Article 14 of the  Constitution.  In
\nother  words, whether such a regulation has to\tcomply\twith
\nthe observance of fundamental rights guaranteed by Part\t III
\nof the Constitution and whether such a power is to be  exer-
\ncised in furtherance of and in consonance with the Directive
\nPrinciples  embodied in Article 38 and 39 of  the  Constitu-
\ntion.\n<\/p>\n
    It\tis convenient to set out the relevant provisions  of
\nRegulation 9(b) framed by the Delhi Road Transport Authority
\nunder the 1950 Act.\n<\/p>\n
9(b) Termination of services\n<\/p>\n
(b)  Whether  the termination is made due  to  reduction  of
\nestablishment or in circumstances other than those mentioned
\nin  (a)\t one month’s notice or pay in lieu thereof  will  be
\ngiven to all categories of employees.\n<\/p>\n
    On\ta  plain reading of this Regulation it\tis  apparent
\nthat the authority has been conferred the power to terminate
\nthe services of any employee whether permanent or  temporary
\nby giving the month’s notice or pay in lieu thereof  without
\nrecording  any reason whatsoever in the purported  order  of
\ntermination of services. Thus a regular, temporary or perma-
\nnent  employee of the State Transport Authority can be\tdis-
\nmissed or removed from service at the whims and caprices  of
\nthe  concerned authority without any reason  whatsoever\t and
\nundoubtedly  this evidence that such unbridled,\t indiscrimi-
\nnate and uncanalised power to terminate the services even of
\na permanent employee without assigning any reason and  with-
\nout  giving any opportunity of hearing as far play and\tjus-
\ntice demands a reasonable procedure is per se, arbitrary and
\ndiscriminatory. It has been contended by the Attorney Gener-
\nal,  appearing on behalf of the State that such a  power  is
\nnot  uncanalised  or unbridled and arbitrary in as  much  as
\nfirstly\t such  power has been conferred on  the\t responsible
\nauthority namely D.T.C.\n<\/p>\n
243<\/span><\/p>\n
for public purposes and secondly, the Regulation 9(b) is  to
\nbe  read  down so as to make it constitutionally  valid.  It
\nwill  be  seen that there is guidance for exercise  of\tthis
\npower  in the regulation itself. It has also been  submitted
\nin  this connection by the learned Attorney General  that  a
\nprovision of the Constitution has to be presumed to be valid
\nunless\tit is proved by the other side challenging the\tcon-
\nstitutional  validity of such a provision that the  same  is
\narbitrary  and so void. Several authorities have been  cited
\nat the Bar on this point.\n<\/p>\n
    It is profitable to refer to the earlier  pronouncements
\nof  this  Court on this crucial question. Rules\t 148(3)\t and
\n149(3)\tin contravention of the provision of Article  14  of
\nthe  Constitution were challenged before this Court  in\t the
\ncase Moti Ram Deka etc. v. General Manager, N.E.F. Railways,
\nMaligaon, Pandu, etc., [1964] 5 SCR 683. Rule 148(3) of\t the
\nRailways Establishment Code is set out here under:
\n“148(3) “Other (non-pensionable) railway servants:
\nThe  service  of other\t(non-pensionable)  railway  servants
\nshall be liable to termination on notice on either side\t for
\nthe periods shown below. Such notice is not however required
\nin  cases of dismissal or removal as a disciplinary  measure
\nafter compliance with the provisions of clause (2) of  Arti-
\ncle 311 of the Constitution, retirement on attaining the age
\nof  superannuation and termination of service due to  mental
\nor physical incapacity.”\n<\/p>\n
    In\tthis case the service of Moti Ram Deka, a  peon\t em-
\nployed\tby  the\t Railway and Sudhir Kumar  Das\ta  confirmed
\nclerk, whose services have been terminated under Rule 148(3)
\nof the said Rules challenged the termination of their  serv-
\nices before the Assam High Court which rejected the same and
\nultimately it came up to this Court on Special Leave. It was
\nheld  by the Majority that Rules 148(3) and 149(3)  are\t in-
\nvalid  in as such as they are inconsistent with\t the  provi-
\nsions of Art. 311(2), as they purport to removal from  serv-
\nice of permanent servants without compliance with the proce-
\ndure prescribed by Article 311(2). It was also held that the
\nRule  148(3)  contravenes Art. 14 as it does  not  give\t any
\nguidance  for  exercise of the discretion by  the  authority
\nconcerned and hence it is invalid.\n<\/p>\n
     It\t is  necessary to refer in this\t connection  to\t the
\npronouncement  of  this Court in the case of  Parshotam\t Lal
\nDhingra v. Union of India,<\/a> [1958] SCR 828 where it has\tbeen
\nheld that protection of Article 311 is
\n244<\/span>
\navailable only where dismissal, removal or reduction in rank
\nis  sought  to\tbe inflicted by way of\tpunishment  and\t not
\notherwise.  Thus even the probationer or temporary  employee
\nif removed from service or dismissed from service as a penal
\nmeasure\t having\t civil consequences has to  conform  to\t the
\nprocedure prescribed by Article 311(2) of the  Constitution.
\nEven  a probationer who has no right to the post  cannot  be
\nremoved\t from service as a penal measure  without  complying
\nwith Article 311(2) of the Constitution.\n<\/p>\n
    In\tthe case of Shyam Lal v. The State of Uttar  Pradesh
\nand  Anr.,  [1955] SCR 26 it was held by this Court  that  a
\ncompulsory retirement from service under the Civil  Services
\n(Classification,  Control and Appeal) Rules does not  amount
\nto dismissal or removal within the meaning of Article 311 of
\nthe  Constitution  and therefore does not  fall\t within\t the
\nprovision of the said Act.\n<\/p>\n
    In\tthe case of Shri Ram Krishna Dalmia v. Shri  Justice
\nS.R. Tendolkar & Others,<\/a> [1959] SCR 279 the constitutionali-
\nty of the Commission of Enquiry Act, 1952 was challenged. It
\nwas held that the Act was valid and intra vires and that the
\nnotification  was also valid excepting the words “as and  by
\nway  of\t securing redress or punishment” in CI.\t 10  thereof
\nwhich went beyond the Act.\n<\/p>\n
    It\thas  been further held that it is now  well  settled
\nthat while Article 14 forbids class legislation, it does not
\nforbid reasonable classification for the purposes of  legis-
\nlation. Thus, to pass the test of permissible classification
\ntwo conditions must be fulfilled, namely, that (i) That\t the
\nclassification must be rounded on an intelligible  differen-
\ntia  which distinguishes persons or things that are  grouped
\ntogether  from others left out of the group and,  (ii)\tthat
\nthat differentia must have a rational relation to the object
\nsought to be achieved by the statute in question.
\n    It has also been held that it must be presumed that\t the
\nlegislature  understands and correctly appreciates the\tneed
\nof  its own people, that its laws are directed\tto  problems
\nmade manifest by experience and that its discriminations are
\nbased on adequate grounds.\n<\/p>\n
    This Court observed in Jyoti Pershad v. The\t Administra-
\ntor For the Union Territory of Delhi, [1962] 2 SCR 125 while
\nholding\t that Section 19 of the Slum Areas (Improvement\t and
\nClearance) Act, 1956, was not obnoxious to the equal protec-
\ntion  of  laws guaranteed by Art, 14  of  the  Constitution,
\nthere was enough guidance to the competent
\n245<\/span>
\nauthority  in the use of his discretion under Section  19(1)
\nof  the Act. The restrictions imposed by Section 19  of\t the
\nAct could not be said to be unreasonable.\n<\/p>\n
    It\thas  been further observed that (1) If\tthe  statute
\nitself\tor the rule made under it applies unequally to\tper-
\nsons  or things similarly situated, it would be an  instance
\nof  a direct violation of the Constitutional  Guarantee\t and
\nthe  provision of the statute or the rule in question  would
\nhave to be struck down.\n<\/p>\n
    (2) The enactment or the rule might not in terms enact a
\ndiscriminatory\trule of law but might enable an\t unequal  or
\ndiscriminatory treatment to be accorded to persons or things
\nsimilarly  situated. This would happen when the\t legislature
\nvests a discretion in an authority, be it the Government  or
\nan  administrative  official acting either as  an  executive
\nofficer\t or even in a quasi-judicial capacity by a  legisla-
\ntion  which  does not lay down any policy  or  disclose\t any
\ntangible or intelligible purpose, thus clothing the authori-
\nty  with unguided and arbitrary powers enabling it  to\tdis-
\ncriminate.\n<\/p>\n
    In\tState of Orissa v. Dr. (Miss) Binapani Dei  &  Ors.,<\/a>
\n[1967] 2 SCR 625 the respondent joined service of the  State
\nGovernment  in 1938. In the service record certain  date  of
\nbirth  was recorded. In 196 1 Government held enquiry as  to
\ndate of birth and she was asked to show cause why a  certain
\ndate  of birth should not be taken as a date of\t birth.\t The
\nenquiry\t report\t was not disclosed to her and  she  was\t not
\ngiven  any opportunity to meet the evidence. The  Government
\nrefixed\t her  date  of birth and ordered that  she  will  be
\ncompulsorily  retired. It was held that such a\tenquiry\t and
\ndecision  were contrary to the basis concept of justice\t and
\ncannot have any value. It is true that the order is adminis-
\ntrative in character, but even an administrative order which
\ninvolves civil consequences as already stated, must be\tmade
\nconsistently with the rules of natural justice after inform-
\ning the first respondent of the case of State, the  evidence
\nin  support thereof and after giving an opportunity  to\t the
\nfirst  respondent of being heard and meeting  or  explaining
\nthe evidence. No such steps were admittedly taken; the\tHigh
\nCourt was, in our judgment, right in setting aside the order
\nof the State.\n<\/p>\n
    In A.K. Kraipak and Others v. Union of India and Others,
\n[1969] 2 SCC 262 it has been held at page 268-269  Paragraph
\n13:\n<\/p>\n
“The dividing line between an administrative power and a
\n246<\/span>
\nquasi  judicial power ‘is quite thin and is being  gradually
\nobliterated. For determining whether a power is an  adminis-
\ntrative\t power or a quasi-judicial power one has to look  to
\nthe nature of the power conferred, the person or persons  on
\nwhom  it is conferred, the framework of the  law  conferring
\nthat  power, the consequences ensuing from the\texercise  of
\nthat power and the manner in which that power is expected to
\nbe  exercised. Under our Constitution the rule of  law\tper-
\nvades  over the entire field of administration. Every  organ
\nof  the State under our Constitution is regulated  and\tcon-
\ntrolled by the rule of law. In a welfare State like ours  it
\nis  inevitable that the jurisdiction of\t the  administrative
\nbodies is increasing at a rapid rate. The concept of rule of
\nlaw would lose its vitality if the instrumentalities of\t the
\nState  are  not charged with the duty of  discharging  their
\nfunctions  in  a fair and just manner.\tThe  requirement  of
\nacting judicially in essence is nothing but a requirement to
\nact  justly and fairly and not arbitrarily or  capriciously.
\nThe procedures which are considered inherent in the exercise
\nof a judicial power are merely those which facilitate if not
\nensure a just and fair decision\t ………\n<\/p>\n
What  was considered as an administrative power\t some  years
\nback is now being considered as a quasi’judicial power. ‘ ‘
\n    In\tthe  case of Union of India v. Col. J.N.  Sinha\t and
\nAnr.,<\/a>  [1971] 1 SCR 79 1. Col. J.N. Sinha  was\tcompulsorily
\nretired by an order of the President of India dated  13.8.69
\nunder Section 56(j) of the Fundamental Rules from Government
\nservice without assigning any reason in the order. The\tHigh
\nCourt  on  a writ petition against the impugned\t order\theld
\nthat there was violation of principles of natural justice.
\nOn an appeal on Special Leave this Court held:
\n“Rules\tof  natural justice are not embodied rules  nor\t can
\nthey  be elevated to the position of fundamental rights.  As
\nobserved by this Court in Kraipak and Ors. v. Union of India<\/a>
\n“the aim of rules of natural justice is to secure justice or
\nto  put\t it negatively to prevent  miscarriage\tof  justice.
\nThese rules can operate only in areas not covered by any law
\nvalidly made. If a statutory provision can be read  consist-
\nently  with  the principles of natural justice,\t the  courts
\nshould do so because it must be presumed that the legisla-\n<\/p>\n
247<\/span><\/p>\n
ture and the statutory authorities intend to act in  accord-
\nance  with  the principles of natural justice.\tBut  on\t the
\nother  hand a statutory provision either specifically or  by
\nnecessary implication excludes the application of any or all
\nthe  principles\t of natural justice then  the  court  cannot
\nignore\tthe  mandate  of the legislature  or  the  statutory
\nauthority and read into the concerned provision the  princi-
\nples  of  natural justice. Whether the exercise of  a  power
\nconferred  should  be  made in accordance with\tany  of\t the
\nprinciples  of natural justice or not depends upon  the\t ex-
\npress  words  of the provisions conferring  the\t power,\t the
\nnature\tof the power conferred, the purpose for which it  is
\nconferred and the effect of the exercise of that power.”\n<\/p>\n
    It was held that Fundamental Rule 56(j) does not in term
\nrequire\t that  any opportunity should be given to  the\tcon-
\ncerned servant to show cause against the compulsory  retire-
\nment.  The order of the President is, therefore, not bad  as
\nthe authority bona fide forms that opinion.
\n    In\tthe case of Air India Corporation v. V.A. Rebello  &
\nAnr.,  AIR  1972 SC 1343 the service of the  respondent\t was
\nterminated  under Regulation 48 of the Air India  Employees’
\nService Regulations. The said Regulation 48 reads as under:
\nCHAPTER VIII–Cessation of Service
\n\t       X X X X X X X X X X X X X X X X X X\n<\/p>\n
48. Termination: The service of an employee may be terminat-
\ned without assigning any reason, as under:\n<\/p>\n
(a) of a permanent employee by giving him 30 days’ notice in
\nwriting or pay in lieu of notice;\n<\/p>\n
(b) of an employee on probation by giving him 7 days’ notice
\nin writing or pay in lieu of notice;\n<\/p>\n
(c)  of a temporary employee by giving him 24 hours’  notice
\nin writing or pay in lieu of notice.\n<\/p>\n
    In this case the complainant, V.A. Rebello was dismissed
\nfrom service under Regulation 48 by paying salary of 30 days
\nin lieu of notice. The order does not suggest any misconduct
\non behalf of the
\n248<\/span>
\ncomplainant  and it is not possible to hold that  the  order
\nwas  passed on any misconduct. This has been  challenged  by
\nthe  complainant by filing a complaint before  the  National
\nIndustrial  Tribunal. Under Section 33-A of  the  Industrial
\nDisputes Act, 1947 the order was challenged as amounting  to
\ndismissal from service. The Tribunal held in its award\tthat
\nthe discharge of the respondent is not a discharge  simplic-
\niter  but in breach of section 33-A of\tIndustrial  Disputes
\nAct  and as such directed the complaint to be considered  on
\nthe  merits.  On appeal by Special Leave  this\tCourt  while
\nconsidering the purpose and scope of Section 33(1) and 33(2)
\nof the Industrial Disputes Act, held following its  decision
\nin The Workmen of Sudder Office Cinnamara v. The Management,<\/a>
\n[1971] 2 Lab LJ 620 as follows:\n<\/p>\n
“That if the termination of service is a colourable exercise
\nof  the\t power vested in the management or as  a  result  of
\nvictimisation  or  unfair labour  practice,  the  Industrial
\nTribunal would have jurisdiction to intervene and set  aside
\nsuch  a termination. In order to find out whether the  order
\nof  termination is one of termination simpliciter under\t the
\nprovisions  of contract or of standing orders, the  Tribunal
\nhas  ample  jurisdiction to go into  all  the  circumstances
\nwhich  led to the termination simpliciter. The form  of\t the
\norder  of termination, is not conclusive of the true  nature
\nof the order, for it is possible that the form may be merely
\na  camouflage for an order of dismissal for  misconduct.  It
\nis, therefore, open to the Tribunal to go behind the form of
\nthe  order and look at the substance. If the Tribunal  comes
\nto  the conclusion that though in form the order amounts  to
\ntermination  simpliciter but in reality cloaks\ta  dismissal
\nfor  misconduct,  it  will be open to it to  set  aside\t the
\norders as a colourable exercise of power by the management.”\n<\/p>\n
    The\t same  principles have also been reiterated  in\t the
\nlater  decision of this Court in Tara Oil Mills Co. Ltd.  v.
\nWorkmen\t & Anr.,<\/a> [1964] 2 SCR 125. It has been\tobserved  in
\nthis case:\n<\/p>\n
“That  the position of the industrial workman  is  different
\nfrom  that  of a Government servant  because  an  industrial
\nemployer cannot “hire and fire” his workmen on the basis  of
\nan  unfettered right under the contract of employment,\tthat
\nright  now  being subject to  industrial  adjudication;\t and
\nthere is also on the other hand no provision of the  Consti-
\ntution\tlike Arts. 3 10 and 311 requiring  consideration  in
\nthe
\n249<\/span>
\ncase of industrial workmen.”\n<\/p>\n
It has been further observed:\n<\/p>\n
“That  Regulation 48 which has been set out earlier  as\t its
\nplain  language shows does not lay down or  contemplate\t any
\ndefined essential pre-requisite for invoking its  operation.
\nAction\tunder  this Regulation can be validly taken  by\t the
\nemployer at his sweet will without assigning any reason.  He
\nis not bound to disclose why he does not want to continue in
\nservice\t the employee concerned. It may be conceded that  an
\nemployer  must always. have some reason for terminating\t the
\nservices of his employee. Such reasons apart from misconduct
\nmay,  inter  alia,  by want of full  satisfaction  with\t his
\noverall\t suitability  in the fact that the employer  is\t not
\nfully  satisfied with the overall result of the\t performance
\nof  his\t duties by his employee does not  necessarily  imply
\nmisconduct on his part.”\n<\/p>\n
    In the case of Maneka Gandhi v. Union of India,<\/a> [1978] 2
\nSCR  62 1. The petitioner was issued a passport on  June  1,
\n1976  under the Passport Act, 1967. On the 4th\tJuly,  1977,
\nthe petitioner received a letter dated 2nd July, 1977,\tfrom
\nthe Regional Passport Officer, Delhi, intimating to her that
\nit  was\t decided by the Government of India to\timpound\t her
\npassport under s. 10(3)(c) of the Act “in public  interest.”
\nThe petitioner was required to surrender her passport within
\n7  days\t from  the receipt of that  letter.  The  petitioner
\nimmediately  addressed\ta letter to  the  Regional  Passport
\nOfficer requesting him to furnish a copy of the statement of
\nreasons\t for making the order as provided in Section  10(5),
\nreply  was  sent  by the Government of\tIndia,\tMinistry  of
\nExternal  Affairs on 6th July 1977 stating inter  alia\tthat
\nthe  Government\t decided  “in the interest  of\tthe  general
\npublic” not to furnish her copy of the statement of  reasons
\nfor  the making of the order. The petitioner challenges\t the
\naction\tof  the Government in impounding her passport  by  a
\nwrit  petition. Sub-section (1) of Section 10  empowers\t the
\nPassport  Authority to vary or cancel the endorsement  on  a
\npassport  or travel document or to vary or cancel it on\t the
\nconditions  subject to which a passport or  travel  document
\nhas been issued having regard to, inter alia, the provisions
\nof s. 6(1) or any notification under Section 19. Sub-section
\n(2)  confers  powers on the Passport Authority\tto  vary  or
\ncancel the conditions of the passport or travel document  on
\nthe  application  of the holder of the\tpassport  or  travel
\ndocument  and  with  the previous approval  of\tthe  Central
\nGovernment, Sub-section (3) pro-\n<\/p>\n
250<\/span><\/p>\n
vides that the Passport Authority may impound or cause to be
\nimpounded  or  revoke a passport or travel document  on\t the
\ngrounds\t set out in cl.(a) to (h). The order impounding\t the
\npassport in the present case was made by the Central Govern-
\nment under cl. (c) which reads as follows:\n<\/p>\n
“(c)  If the passport authority deems it necessary so to  do
\nin  the interest of the sovereignty and integrity of  India,
\nthe security of India, friendly relations of India with\t the
\nforeign country, or in the interest of the general public.”\n<\/p>\n
    It was held that the right to travel and go outside\t the
\ncountry is included in the right to Personal Liberty.
\n    In order to apply the test contained in Arts. 14 and  19
\nof  the\t Constitution we have to consider  the\tobjects\t for
\nwhich the exercise of inherent rights recognised by Art.  21
\nof the Constitution are restricted as well as the  procedure
\nby  which these restrictions are sought to be imposed,\tboth
\nsubstantive and procedural laws and actions taken under them
\nwill  have  to\tpass the test imposed by Arts.\t14  and\t 19,
\nwhenever facts justifying the invocation of either of  these
\nArticles  may be disclosed. Violation for both Arts. 21\t and
\n19(1)(g)  may  be put forward making it\t necessary  for\t the
\nauthorities concerned to justify the restriction imposed  by
\nshowing\t satisfaction of tests of validity  contemplated  by
\neach of these two Articles.\n<\/p>\n
    The tests of reason and justice cannot be abstract. They
\ncannot\tbe divorced from the needs of the nation. The  tests
\nhave  to be pragmatic otherwise they would cease to be\trea-
\nsonable.  The discretion left to the authority to impound  a
\npassport  in public interest cannot invalidate the  law\t it-
\nself.\n<\/p>\n
    The\t orders under Section 10(3) must be based upon\tsome
\nmaterial  even\tif the material concerns in  some  cases  of
\nreasonable  suspicion arising from certain  credible  asser-
\ntions made by reliable individual. In an emergent situation,
\nthe  impounding of a passport may become  necessary  without
\neven  giving an opportunity to be heard against such a\tstep
\nwhich could be reversed after an opportunity is given to the
\nholder of the passport to show why the step was unnecessary.
\n    It\tis  well-settled that even if there is\tno  specific
\nprovision in a statute or rules made thereunder for  showing
\ncause  against action proposed to be taken against an  indi-
\nvidual, which affects the right of
\n251<\/span>
\nthat  individual the duty to give reasonable opportunity  to
\nbe heard will be implied from the nature of the function  to
\nbe  performed by the authority which has the power  to\ttake
\npunitive or damaging action.\n<\/p>\n
    An order impounding a passport must be made\t quasi-judi-
\ncially. This was not done in the present case. It cannot  be
\nsaid  that a good enough reason has been shown to exist\t for
\nimpounding  the passport of the petitioner.  The  petitioner
\nhad no opportunity of showing that the ground for impounding
\nit  given  in  this Court either does not exist\t or  has  no
\nbearing\t on public interest or that the public interest\t can
\nbe  better served in some other manner. The order should  be
\nquashed\t and  the respondent should be directed to  give  an
\nopportunity  to\t the petitioner to show\t cause\tagainst\t any
\nproposed action on such grounds as may be available.
\n    Even  executive authorities when  taking  administrative
\naction\twhich involves any deprivation of or restriction  on
\ninherent  fundamental rights of citizens must take  care  to
\nsee that justice is not only done but manifestly appears  to
\nbe done. They have a duty to proceed in a way which is\tfree
\nfrom even the appearance of arbitrariness,  unreasonableness
\nor unfairness. They have to act in a manner which is patent-
\nly impartial and meets the requirements of natural justice.
\n    It\tis  also pertinent to refer in this  connection\t the
\npronouncement  of this Court in the case of E.P. Royappa  v.
\nState of Tamil Nadu and Anr.,<\/a> [1974] 2 SCR 348.
\n“Equality  and arbitrariness are sworn enemies, one  belongs
\nto  the rule of law in a public while the other to the\twhim
\nand  caprice of an absolute monarch. Article 14\t strikes  at
\narbitrariness  in  State  action and  ensures  fairness\t and
\nequality of treatment. The principle of reasonableness which
\nlegally as well as philosophically, is an essential  element
\nof equality or non-arbitrariness pervades Article 14 like  a
\nbrooding  omni-presence\t and the procedure  contemplated  by
\nArticle\t 21 must answer the test of reasonableness in  order
\nto  be in conformity with Article 14, it must be  right\t and
\njust and fair and not arbitrary, fanciful or oppressive.”\n<\/p>\n
     In the case of Municipal Corporation of Greater  Bombay
\nv.  Malvenkar  and Ors.,<\/a> [1978] 3 SCR 1000 the\tservices  of
\nrespondent  No. 2, a permanent clerk in the Bombay  Electric
\nSupply and Transport Undertaking, which is run by the appel-
\nlant were terminated from the
\n252<\/span>
\nclose of work on January 23,’ 1968 as her record of  service
\nwas unsatisfactory. The order of termination stated that the
\nrespondent No. 2 should be paid one month’s wages in lieu of
\nnotice\tand would also be eligible for all the\tbenefits  as
\nmight  be admissible under the Standing Orders\tand  Service
\nRegulations of the Undertaking. The respondent No. 2 made an
\napplication  before the Labour Court under Section 42(4)  of
\nthe  Bombay  Industrial Relations Act  contending  that\t the
\norder  terminating  her services was invalid as it  was\t not
\npassed by the competent authority as envisaged by the Stand-
\ning Order and that the so called Executive Assistant to\t the
\nGeneral\t Manager had no authority to terminate her  services
\nbecause\t no  validly  sanctioned post  of  that\t designation
\nexisted on 20th or 23rd January, 1968. It was also contended
\nthat the aforesaid oders besides being mala fide was  viola-
\ntive of the principles of natural justice in as much as\t the
\nsame  was  passed without holding any  enquiry.\t The  Labour
\nCourt  dismissed  the application. The\trespondent’s  appeal
\nbefore\tthe  President of the Industrial Court\twas  however
\nallowed. The Industrial Court held that the impugned  orders
\nbore only the initials of the Central Manager and  therefore
\nit was passed by an authority which was lacking in  authori-
\nty,  the  wording  “unsatisfactory service  record”  cast  a
\nstigma and was patently punitive attracting the\t non-observ-
\nance of Standing Order No. 26 which did not create an  abso-
\nlute right in the management to terminate the services of an
\nemployee for misconduct without holding an enquiry or giving
\nher  a fair opportunity of being heard. A  Writ\t application
\nfiled by the appellant was dismissed holding inter alia that
\nthe appellant was dismissed holding inter alia that the fact
\nthat  Standing Order 26 required reasons to be mentioned  in
\nthe  order terminating the services of an employee  did\t not
\nmean that an order of dismissal on the ground of  misconduct
\ncould be converted into an order of discharge simpliciter by
\nmentioning therein the nature of misconduct.
\n    While  allowing the appeal on Special Leave it was\theld
\nby this Court that under Standing Order 26 powers have\tbeen
\ngiven to the Management in a particular case and this  ques-
\ntion has to be determined having regard to the substance  of
\nthe  matter  and not its form. One is the power\t of  holding
\ndisciplinary enquiry under clause (3) of Standing Order\t 231
\nread  with standing Order 23 and the other is the  power  to
\nterminate  the\tservices  of an\t employee  by  one  calendar
\nmonth’s written notice or pay in lieu thereof under Standing
\nOrder  26. The question is as to which power has been  exer-
\ncised by the Management in a particular case and this  ques-
\ntion has to be determined having regard to the substance  of
\nthe  matter  and not its form. There are  two  distinct\t and
\nindependent powers and as far as possible, neither should
\n253<\/span>
\nbe  construed so as to emasculate the other or to render  it
\nineffective.  One  is the power to punish  an  employee\t for
\nmisconduct  while the other is the power to  terminate\tsim-
\npliciter  the service of an employee without any  other\t ad-
\nverse  consequences. Proviso (i) to clause (1)\tof  Standing
\nOrder  26  requires that the reason for termination  of\t the
\nemployment  should be given in writing to the employee\twhen
\nexercising  the\t power\tof termination of  services  of\t the
\nemployee under Standing Order 26. The Management is required
\nto  articulate\tthe reason which operated in  its  mind\t for
\nterminating the services of the employee. But merely because
\nthe  reason must obviously not be arbitrary.  capricious  or
\nirrelevant, it would not necessarily in every case make\t the
\norder of termination punitive in character so as to  require
\ncompliance  with the requirements of clause (2) of  Standing
\nOrder  21 read with Standing Order 23. It was  further\theld
\nthat the service of the respondent was not satisfactory\t was
\nundoubtedly  based on past incidents set out in\t the  record
\nbut  for each of these incidents punishment is one  form  or
\nanother had already been meted out to her and it was not  by
\nway of punishment for any of these incidents, but because as
\ngathered  from\tthese incidents, her record of\tservice\t was
\nunsatisfactory\tthat her service was terminated by the\tman-
\nagement\t under\tStanding Order 26.  The\t appellant  produced
\nsatisfactory evidence to show that the impugned order termi-
\nnating the service of the respondent was justified and hence
\nthe impugned order must be sustained despite its having been
\npassed without complying with the requirements of clause (2)
\nof  Standing  Order  21 read with Standing  Order  23.\tThis
\ndecision  has  been made in the special\t facts\tand  circum-
\nstances in that particular case.\n<\/p>\n
    In the case of Manohar P. Kharkhar And Anr. v.  Raghuraj
\n&  Anr.,  [1981] 4 LLJ 459 the\tpetitioners  challenged\t the
\norder  of  termination of services dated 29.4.\t1981,  under
\nRegulation  48 of Air India Employees’ Service\tRegulations.
\nThe petitioner No. 1 was The Director of Engineering and the
\nHead of the Engineering Department while the petitioner\t No.
\n2  was Deputy Director of Engineering (Maintenance) and\t the
\nHead  of the Maintenance Division of the Air India  Corpora-
\ntion. The Chairman and Managing Director of the said  Corpo-
\nration\tlost confidence in their ability and suitability  to
\nhold such important posts of Head of Departments which\twere
\nreasonable for maintenance of the Air Crafts, safety of\t the
\nAir Crafts and safety of the passengers carried therein\t and
\nthe  order  of\ttermination were based on the  note  of\t The
\nChairman dated 29.4. 1981. Loss of confidence was the result
\nof the negligence and failure to discharge their duty culmi-
\nnating\tin the admitted sabotage in the case of\t Makalu,  an
\nair craft
\n254<\/span>
\nfor  the  flight of VVIP. On this occasion  the\t petitioners
\nservices  were terminated on April 29, 1981 by the  Chairman
\nwho recorded in its record the ground of loss of confidence.
\nThis  order was challenged as arbitrary and  capricious\t and
\nRegulation  48 was violative of Article 14 of the  Constitu-
\ntion  as  it contained to guidelines  for  choosing  between
\nemployees  and employees, occasion to occasion for the\tcon-
\ntemplated action.\n<\/p>\n
    In negativing the contentions, it was held after exhaus-
\ntively\tanalysing the note dated 29.4.1981, that  sheer\t un-
\nsuitability and unfitness to hold office is not a misconduct
\nin  its\t generic sense or in its  artificial  meaning  under
\nRegulation  42.\t Regulations 42 to 44 have  no\tapplication.
\nConfidence  in the petitioners’ suitability was lost due  to
\nsuch  overall  inefficiency  of the  departments  under\t the
\npetitioners.  Conclusions could not be different even if  it
\nassumed that the note contemplated finding of the  petition-
\ners guilty of gross inefficiency and negligence. Inefficien-
\ncy  by\titself did not amount to misconduct in\tits  generic
\nsense.\n<\/p>\n
    It\twas further held that the petitioners have no  right
\nto  the post and do not possess any security of\t tenure.  It
\nwas  also held that if the Corporation choose to  act  under
\nRegulation 48 and the action is not mala fide, arbitrary  or
\ncapricious  the question of its having acted  in  colourable
\nexercise  of its power could not arise. It was further\theld
\nthat  the power conferred under Regulation 48  to  terminate
\nthe services of permanent employees on 30 days notice  with-
\nout  assigning any reason is not violative of Article 14  of
\nthe  Constitution.  Accordingly the writ petition  was\tdis-
\nmissed\tand the rule was discharged. This  decision  however
\nhas  not duly considered the ratio of the decision  made  by
\nthis  Court  in L. Michael & Anr. v.  Johnaton\tPumps  India
\nLtd.,<\/a>  [1975]  3 SCR 489 and also in the case of  Air  India
\nCorporation v. V.A. Rebello, (supra) as well as the ratio of
\nthe  decision in the case of Sukhdev Singh & Ors. v.  Bhagat
\nRam Sardar Singh Raghuvanshi & Anr.,<\/a> [1975] 1 SCC421.
\n    In the case of S.S. Muley v. J.R.D. Tata & Ors.,  [1979]
\n2  SLR 438 constitutionality came up for  consideration\t and
\nthis Court held the said Regulation 48 to be  discriminatory
\nand void as it gives unrestricted and unguided power on\t the
\nAuthority concerned to terminate the services of a permanent
\nemployee by issuing a notice or pay in lieu thereof  without
\ngiving any opportunity of hearing to the employee  concerned
\nand thereby violating the principles of natural justice\t and
\nalso Article 14 of the Constitution.\n<\/p>\n
255<\/span><\/p>\n
    In\tWest Bengal State Electricity Board & Ors.  v.\tDesh
\nBandhu Ghosh and Others,<\/a> [1985] 3 SCC 116 the first respond-
\nent, a permanent employee of the West Bengal State Electric-
\nity  Board, filed the writ petition out of which the  appeal
\narises\tin the Calcutta High Court to quash an\torder  dated
\nMarch 22, 1984 of the Secretary, West Bengal State Electric-
\nity Board terminating his services as Deputy Secretary\twith
\nimmediate effect on payment of three months’ salary in\tlieu
\nof three months’ notice. The order was made under Regulation
\n34  of\tthe Board’s Regulations which enables the  Board  to
\nterminate the services of any permanent employee ‘by serving
\nthree months’ notice or on payment of salary for the  corre-
\nsponding period in lieu thereof.” The Regulation 34 reads as
\nfollows:\n<\/p>\n
“34.  In case of a permanent employee, his services  may  be
\nterminated by serving three months’ notice or on payment  of
\nsalary for the corresponding period in lieu thereof.”\n<\/p>\n
    This  order of termination was challenged on the  ground
\nthat  Regulation 34 was arbitrary in nature and it was\tpat-
\nently  discriminatory. The High Court struck down the  first
\nparagraph of Regulation 34 and quashed the order of termina-
\ntion of service of the first respondent.\n<\/p>\n
    In the case of Workmen of Hindustan Steel Ltd. and\tAnr.
\nv. Hindustan Steel Ltd. and Ors.,<\/a> [1985] 2 SCR 428. Standing
\nOrder  32  which  provided for conferment of  power  in\t the
\nGeneral Manager to terminate the services of an employee  if
\nsatisfied for reasons recorded in writing that it was  inex-
\npedient\t or  against  the order of security  to\t employ\t the
\nworkman,  the  workman could be removed\t or  dismissed\tfrom
\nservice without following the procedure laid down in  Stand-
\ning Order 31.\n<\/p>\n
“32. Special Procedure in certain cases.\n<\/p>\n
Where a workman has been convicted for a criminal offence in
\na  Court of law or where the General Manager  is  satisfied,
\nfor reasons to be recorded in writing, that it is  inexpedi-
\nent  or\t against the interests of security  to\tcontinue  to
\nemploy the workman, the workman may be removed or  dismissed
\nfrom  service without following the procedure laid  down  in
\nStanding Order 31.”\n<\/p>\n
    The appellant, an Assistant in the 1st Respondent-under-
\ntaking\twas removed from service on the ground that  it\t was
\n‘no longer expe-\n<\/p>\n
256<\/span><\/p>\n
dient’\tto  employ him. The management\tdispensed  with\t the
\ndepartmental  enquiry, after looking into the secret  report
\nof  one of their officers that the appellant had  misbehaved
\nwith the wife of an employee and that a complaint in respect
\nthereof\t had been lodged with the police. The Tribunal\theld
\nthat as the employer dispensed with the disciplinary enquiry
\nin exercise of the power conferred by Standing Order 32,  it
\ncould  not be said that the dismissal from service  was\t not
\njustified and the respondent was quite competent to  dismiss
\nhim from service without holding any enquiry.
\n    It\twas  held that the reasons for dispensing  with\t the
\nenquiry do not spell out what was the nature of the  miscon-
\nduct  alleged  to have been committed by the  appellant\t and
\nwhat  prompted\tthe  General Manager to\t dispense  with\t the
\nenquiry.\n<\/p>\n
    As\tthere was no justification for dispensing  with\t the
\nenquiry\t imposition  of\t penalty of  dismissal\twithout\t the
\ndisciplinary enquiry as contemplated by Standing Order 31 is
\nillegal and invalid.\n<\/p>\n
    It\twas  further  held that :-“A  Standing\tOrder  which
\nconfers\t such  arbitrary. uncanalised and drastic  power  to
\ndismiss an employee by merely stating that it is inexpedient
\nor  against  the  interest of the security  to\tcontinue  to
\nemploy the workman is violative of the basic requirement  of
\nnatural\t justice  inasmuch as that the General\tManager\t can
\nimpose\tpenalty\t of such a drastic nature as to\t affect\t the
\nlivelihood and put a stigma on the character of the  workman
\nwithout\t recording reasons why disciplinary inquiry is\tdis-
\npensed with and what was the misconduct alleged against\t the
\nemployees.  It is time for such a public sector\t undertaking
\nas Hindustan Steel Ltd. to recast S.O. 32 and to bring it in
\ntune  with the philosophy of the Constitution failing  which
\nit being other authority and therefore a State under Art. 12
\nin an appropriate proceeding, the vires of S.O. 32 will have
\nto be examined. It is not necessary to do so in the  present
\ncase because even on the terms of S.O. 32, the order made by
\nthe General Manager is unsustainable.”\n<\/p>\n
    In\tthe  case of Tata Oil Mills Co. Ltd.  v.  Workmen  &
\nAnr.,<\/a>  (supra) the service of Mr. Banerjee, an\temployee  of
\nthe appellant, was terminated on the ground that the  appel-
\nlant had lost confidence in him and in lieu of notice he was
\npaid  one  month’s salary. The Union to which  Mr.  Banerjee
\nbelonged  took up his cause and on the failure of -‘he\tpar-
\nties  to reach a settlement the matter was referred  to\t the
\nIndustrial  Tribunal  by the Government.  It  was  contended
\nbefore\tthe  Tribunal  by the appellant that  the  order  of
\ntermination of services of Mr.
\n257<\/span>
\nBanerjee was an order of discharge which it was competent to
\nmake  under R. 40(1) of the Service Rules, whereas  the\t re-
\nspondent contended that the termination was not a  discharge
\nsimpliciter  but  was in substance dismissal  and  that\t the
\nTribunal  was  entitled\t to consider the  propriety  of\t the
\nappellant’s action.\n<\/p>\n
    The Tribunal held that it had jurisdiction to look\tinto
\nthe  reasons  behind the discharge of an  employee.  On\t the
\nexamination of the evidence the Tribunal found that no\tmala
\nfides  on the part of the employer had been proved and\tthat
\nthe  termination of service did not amount to  victimisation
\nor  unfair  labour practice. Even so it held that  the\tdis-
\ncharge\twas not justified and directed the reinstatement  of
\nMr. Banerjee.\n<\/p>\n
    This  Court held that in the matter of an order of\tdis-
\ncharge of an employee the form of the order is not decisive.
\nAn  Industrial\tTribunal  has jurisdiction  to\texamine\t the
\nsubstance  of the matter and decide whether the\t termination
\nis, in fact, discharge simpliciter or it amounts to dismiss-
\nal which has put on the cloak of discharge simpliciter.\t The
\ntest  always  has to be whether the act of the\temployer  is
\nbona fide or whether it is a mala fide and colourable  exer-
\ncise of the powers conferred by the terms of contract or  by
\nthe standing orders.\n<\/p>\n
    In O.P. Bhandari v. Indian Tourism Development  Corpora-<\/a>
\ntion  Ltd.  and Others, [1986] 4 SCC 337.  The\tquestion  of
\nconstitutionality of Rule 31(v) of the Indian Tourist Devel-
\nopment\tCorporation Rules came up for  consideration  before
\nthis Court in this case. Rule 31 is quoted below:
\n“31.  Termination of services–The services of\tan  employee
\nmay be terminated by giving such notice or notice pay as may
\nbe  prescribed in the contract of service in  the  following
\nmanner:\n<\/p>\n
(v) of an employee who has completed his probationary period
\nand  who  has been confirmed or deemed to  be  confirmed  by
\ngiving him 90 days’ notice or pay in lieu thereof.”
\nIt has been observed by this Court:\n<\/p>\n
“This rule cannot co-exist with Articles 14 and 16(1) of the
\nConstitution of India. The said rule must therefore die,  so
\nthat the fundamental rights guaranteed by the aforesaid
\n258<\/span>
\nconstitutional\tprovisions remain alive. For otherwise.\t the
\nguarantee  enshrined in Articles 14 and 16 of the  Constitu-
\ntion can be set at naught simply by framing a rule authoriz-
\ning termination of an employee by merely giving a notice. In
\norder of uphold the validity of the rule in question it will
\nhave to be held that the tenure of service of a citizen\t who
\ntakes up employment with the State will depend on the pleas-
\nure  or\t whim  of the competent authority  unguided  by\t any
\nprinciple  or policy. And that the services of\tan  employee
\ncan  be\t terminated though there is no rational\t ground\t for
\ndoing  so. even arbitrarily or capriciously. To uphold\tthis
\nright  is to accord a “magna carta” to the  authorities\t in-
\nvested with these powers to practice uncontrolled  discrimi-
\nnation\tat their pleasure and caprice on considerations\t not
\nnecessarily  based  on the welfare of the  organisation\t but
\npossibly  based\t on personal likes  and\t dislikes,  personal
\npreferences  and  prejudices. An employee  may\tbe  retained
\nsolely on the ground that he is asycophancy and indulges  in
\nflattery,  whereas  the services of one who  is\t meritorious
\n(but who is wanting in the art of sycophancy and  tempermen-
\ntally incapable of indulging in flattery) may be terminated.
\nThe power may be exercised even on the unarticulated  ground
\nthat  the former belongs to the same religious faith  or  is
\nthe disciple of the same religious teacher or holds opinions
\ncongenial  to him. The power may be exercised  depending  on
\nwhether\t or not the concerned employee belongs to  the\tsame
\nregion. or to the same caste as that of the authority  exer-
\ncising\tthe power, of course without saying so.\t Such  power
\nmay  be\t exercised  even in order to make  way\tfor  another
\nemployee  who is favourite of the concerned authority.\tPro-
\nvincialism,  casteism, nepotism, religious  fanaticism,\t and
\nseveral\t other\tobnoxious factors may in  that\tcase  freely
\noperate\t in the mind of the competent authority on  deciding
\nwhom to retain and whom to get rid of. And these dangers are
\nnot imaginary ones. They are very much real in organisations
\nwhere  there is a confluence of employees streaming in\tfrom
\ndifferent  States.  Such  a rule is capable  of\t robbing  an
\nemployee  of  his dignity, and making him  a  supine  person
\nwhose  destiny\tis at the mercy of the\tconcerned  authority
\n(whom he  must\thumour)\t notwithstanding the  constitutional
\nguarantee  enshrined in Articles 14 and 16 of the  Constitu-
\ntion of India. To hold otherwise is to hold that the funda-\n<\/p>\n
259<\/span><\/p>\n
mental\tright  embedded in Articles 14 and 16(1) is  a\tmere
\npaper tiger and that is so ethereal that it can be nullified
\nor  eschewed  by  a simple device of framing  a\t rule  which
\nauthorizes  termination\t of the service of  an\temployee  by
\nmerely\tgiving\ta notice of termination. Under\tthe  circum-
\nstances the rule in question must be held to be\t unconstitu-
\ntional and void.”\n<\/p>\n
This  decision\tfollowed the observations of this  Court  in
\nCentral\t Inland\t Water\tTransport  Corporation\tLimited\t And
\nAnother\t v. Brojo Nath Gangtdy and Another and\tWest  Bengal
\nState  Electricity  Board<\/a>  v. Desh Bandhu  Ghosh  and  Ors.,
\n(Supra).\n<\/p>\n
    In\tCentral Inland Water Transport\tCorporation  Limited
\nand Another v. Brojo Nath Ganguly and Another, [1986] 3\t SCC
\n156 the appellant Corporation is a Government Company incor-
\nporated under the Companies Act. The Majority shares of\t the
\nCorporation are held by the Union of India and the remaining
\nshares\tare  held  by the State of West\t Bengal\t and  Assam.
\nArticle 47 provided for appointment and reappointment of the
\nauditors  of the Corporation to be made by the Central\tGov-
\nernment on the advice of the Comptroller and  AuditorGeneral
\nof  India and the nature of control to be exercised  by\t the
\nComptroller  and Auditor-General in the matter of audit\t and
\naccounts.  Article 51-A entitled the President to  call\t for
\nreturns,  accounts etc. of the Corporation. The\t respondents
\nin the two appeals were in the service of the said  company.
\nTheir  appointment letters were in a stereotype\t form  under
\nwhich  the  Corporation could without  any  previous  notice
\nterminate  their services. A Scheme of Arrangement  was\t en-
\ntered  into  between the Corporation and  that\tcompany\t for
\ndissolution  of the latter and takeover of its business\t and
\nliabilities by the former. The Scheme inter alia  stipulated
\nthat  the  Corporation shall take as many  of  the  existing
\nstaff or labour as possible and that those who could not  be
\ntaken over shall be paid by the concerned company all moneys
\ndue  to\t them  under the law and all  legitimate  and  legal
\ncompensations  payable to them either under Industrial\tDis-
\nputes  Act  or otherwise legally admissible  and  that\tsuch
\nmoneys\tshall be provided by the Government of India to\t the
\ntransferor  Company  who would pay these dues. The  two\t re-
\nspondents were in the service of the said company and  their
\nservices were taken over by the Corporation after the Scheme
\nof  Arrangement\t was sanctioned by the High Court.  The\t re-
\nspondent Ganguly was appointed as the Deputy Chief  Accounts
\nOfficer\t and  was later promoted as Manager  (Finance),\t the
\nrespondent  Sengupta was appointed as Chief Engineer  (River
\nServices) and was
\n260<\/span>
\nlater promoted as General Manager (River Services).
\n    Rule  9(i) of the Corporation’s Service, Discipline\t and
\nAppeal Rules of 1979 provided that the services of a  perma-
\nnent employee could be terminated on three months’ notice on
\neither\tside or on payment of three months’ pay plus  DA  to
\nthe  employee  or  on deduction of a like  amount  from\t his
\nsalary\tas the case may be in lieu of the notice.  A  notice
\nunder  Rule 9(i) was served on him terminating his  services
\nwith  immediate\t effect by paying three\t months’  pay.\tBoth
\nGanguly\t and Sengupta filed writ petition before High  Court
\nand a Division Bench of that Court allowed the same.
\n    The Corporation filed appeals before Supreme Court.\t The
\nimpugned  questions for determination were (i)\twhether\t the
\nappellant Corporation was an instrumentality of the State so
\nas  to be covered by Articles 12 and 36 of the\tConstitution
\nand  (ii)  whether an unconscionable term in a\tcontract  of
\nemployment entered into with the Corporation was void  under
\nSection\t 23 of the Contract Act and violative of Article  14
\nand  as\t such whether Rule 9(i) which formed a part  of\t the
\ncontract  of  employment  between the  Corporation  and\t its
\nemployees  to  whom the said Rules applied, was\t void?\tThis
\nCourt  held  that it being a Government Company\t within\t the
\nmeaning of Article 12 of the Constitution has to comply with
\nthe rights embodied in Part III of the Constitution and\t the
\nDirective Principles in Part IV of the Constitution. It\t was
\nfurther\t held that by extending the executive power  of\t the
\nUnion and each of the States to the carrying on any trade or
\nbusiness.  Article 298 does not convert either the Union  of
\nIndia or any of the States which collectively form the Union
\ninto  a\t merchant buying and selling goods  or\tcarrying  on
\neither trading or business activity, for the executive power
\nof  the Union and the States, whether in the field of  trade
\nor  business  or in any other field, is\t always\t subject  to
\nconstitutional\tlimitations and particularly the  provisions
\nrelating to Fundamental Rights in Part III and is  exercisa-
\nble in accordance with and for the furtherance of the Direc-
\ntive Principles of State Policy.\n<\/p>\n
    Rule  9(i) can aptly be called the ‘Henry VIII  Clause’.
\nIt  confers an absolute. arbitrary and unguided\t power\tupon
\nthe Corporation. It does not even state who on behalf of the
\nCorporation  is\t to  exercise that power.  While  the  Rules
\nprovide for four different modes in which the services of  a
\npermanent  employee can be terminated earlier than  his\t at-
\ntaining\t the  age  of superannuation,  namely,\tRules  9(i),
\n9(ii). 36(iv)(b) read with Rules 38 and 37. Rule 9(i) is the
\nonly  rule  which does not state in what  circumstances\t the
\npower conferred by the rule is
\n261<\/span>
\nto  be\texercised.  Thus even where  the  Corporation  could
\nproceed under Rule 36 and dismiss an employee on the  ground
\nof misconduct after holding a regular disciplinary  inquiry,
\nit is free to resort instead to Rule 9(i) in order to  avoid
\nthe hassle of an inquiry. No opportunity of a hearing is  at
\nall  to be afforded to the permanent employee whose  service
\nis  being terminated in the exercise of this power. It\tthus
\nviolates  audi alteram partent rule of natural justice\talso
\nwhich is implicit in Article 14. It is not covered by any of
\nthe  situations which would justify the total  exclusion  of
\nthe  audi  alteram partem rule. The view that the  Board  of
\nDirectors  would  not  exercise this  power  arbitrarily  or
\ncapriciously as it consists of responsible and highly placed
\npersons ignores the fact that however highly placed a person
\nmay  be\t he  must necessarily possess  human  frailties\t and
\n“power\ttends to corrupt, and absolute power corrupts  abso-
\nlutely.”\n<\/p>\n
    Rule  9(i)is  also\tdiscriminatory for  it\tenables\t the
\nCorporation  to discriminate between employee and  employee.
\nIt  can pick up one employee and apply to him Rule 9(i).  It
\ncan pick up another employee and apply to him Rule 9(ii). It
\ncan  pick  up  yet another employee and apply  to  him\tRule
\n36(iv)(b)  read with Rule 38 and to yet another employee  it
\ncan apply Rule 37. All this the Corporation can do when\t the
\nsame circumstances exist as would justify the Corporation in
\nholding\t under Rule 38 a regular disciplinary  inquiry\tinto
\nthe alleged misconduct of the employee.\n<\/p>\n
    This  court\t in Delhi Transport  Undertaking  v.  Balbir
\nSaran Goel,<\/a> [1970] 3 SCR 757 considered the question whether
\nthe  services of a permanent employee under Delhi  Transport
\nUndertaking could be terminated under Regulation 9(b) of the
\nRegulation  without complying with the procedure  prescribed
\nby  Regulation\t15 and (ii) whether although the  order\t was
\nmade in perfectly harmless and innocuous terms purporting to
\nbe  within  Regulation\t9(b) it was a  mere  camouflage\t for
\ninflicting  punishment for breach of Standing Order  17.  as
\nthe respondent approached the High Court without  exhausting
\nthe  Departmental remedies and held that the order  was\t not
\nproved\tto  be made mala tide on the part of  the  authority
\nterminating  the service nor the question of mala  fide\t was
\ngone into by the Courts below.\n<\/p>\n
    Regulation\t9(b) empowered the authorities to  terminate
\nthe  service after giving one month’s notice or pay in\tlieu
\nthereof. The order was held to have been made  unequivocally
\nin  terms of the Regulation 9(h) as the employee was a\tcon-
\ntankerous  person  and\tit was desirable to  retain  him  in
\nservice. The order was upheld. The question
\n262<\/span>
\nwhether Regulation 9(b) was illegal and void as it conferred
\narbitrary and uncanalised power to terminate the service  of
\na permanent employee without recording any reason and  with-
\nout  giving  any opportunity of hearing before\tpassing\t the
\npurported order as required under Article 14 of the  Consti-
\ntution was neither raised nor considered in this case.
\n    In\tL. Michael & Anr. v. M\/s Johnston Pumps India  Ltd.,<\/a>
\n(supra)\t the services of the appellant, an employee  of\t the
\nrespondent,  were  terminated by the latter giving  him\t one
\nmonth’s notice as per. the standing orders without assigning
\nany  reasons for the termination. An industrial dispute\t was
\nreferred  to the Labour Court. The management  alleged\tthat
\nthe  employee misused his position by passing  an  important
\nand  secret  information  about affairs of  the\t company  to
\ncertain\t outsiders,  that even after he was  transferred  to
\nanother section he made attempts to elicit information\tfrom
\nthe section with a view to pass it on to outsiders, and that
\ntherefore,  the management lost confidence in  the  employee
\nand terminated his services by a bona fide order. The Labour
\nCourt confirmed the order.\n<\/p>\n
    On\tappeal this Court set aside the order  holding\tthat
\nthe  Labour Court has misled itself on the law.\t This  Court
\ndirected reinstatement of the employee with all back wages.
\n    The manner of dressing up an order does not matter.\t The
\nCourt will lift the veil to view the reality or substance of
\nthe order.\n<\/p>\n
    The Tribunal has the power and indeed the duty to  X-ray
\nthe  order and discover its true nature, if the\t object\t and
\neffect,\t if  the attendant circumstances  and  the  ulterior
\npurpose be to dismiss the employee because he is an evil  to
\nbe  eliminated. But if the management, to cover up the\tina-
\nbility to establish by an inquiry, illegitimately but  inge-
\nniously\t passes\t an innocent looking  order  of\t termination
\nsimpliciter,  such  action is bad and is liable\t to  be\t set
\naside.\tLoss of confidence is no new armour for the  manage-
\nment;  otherwise  security  of tenure, ensured\tby  the\t new
\nindustrial  jurisprudence and authenticated by a  catend  of
\ncases  of  this Court can be subverted by this\tneo  formula
\nLoss of Confidence in the law will be the consequence of the
\nLoss of Confidence doctrine.\n<\/p>\n
    An employer who believes and suspects that his  employee
\nparticularly  one  holding  a position\tof  confidence,\t has
\nbetrayed  that confidence, can, if the conditions and  terms
\nof employment permit
\n263<\/span>
\nterminate  his\temployment  and discharge  him\twithout\t any
\nstigma attaching to the discharge. But such belief or suspi-
\ncion or’ the employer should not be a mere whim or fancy. It
\nshould\tbe  bona fide and reasonable. It must rest  on\tsome
\ntangible  basis\t and the power has to be  exercised  by\t the
\nemployer  objectively’, in good faith. which means  honestly
\nand  with  due care and prudence. If the  exercise  of\tsuch
\npower  is  challenged on the ground of being  colourable  or
\nmala fide or an act of victimisation or unfair labour  prac-
\ntice. the employer must disclose to the Court the grounds of
\nhis impugned action so that the same may be tested judicial-
\nly.\n<\/p>\n
    This  Court\t in the case of workmen of  Hindustan  Steel
\nLtd.  and  Ant. v. Hindustan Steel Ltd.\t and  Ors.,<\/a>  (supra)
\nwhile considering the constitutionality of Standing Order 32
\nof  the\t Hindustan Steel Ltd. which conferred power  on\t the
\nGeneral\t Manager  to  remove or dismiss\t a  workman  without
\nfollowing  the procedure for holding a disciplinary  enquiry
\nlaid down in Standing Order 31 observed that:
\n“It  is time for such a public sector undertaking as  Hindu-
\nstan  Steel Ltd. to recast S.O. 32 and to bring it  in\ttune
\nwith  the  philosophy of the Constitution failing  which  it
\nbeing other authority and therefore a State under Article 12
\nin an appropriate proceeding, the views of S.O. 32 will have
\nto be examined.”\n<\/p>\n
     It\t is  convenient to refer in  this  context  relevant
\npassage in paragraph 4 in Chitty on Contracts, 25th Edition,
\nVolume 1:\n<\/p>\n
“These ideas have to a large extent lost their appeal today.
\n‘Freedom  of contract’, it has been said, ‘is  a  reasonable
\nsocial ideal only to the extent that equality of  bargaining
\npower  between\tcontracting parties can be assumed,  and  no
\ninjury is done to the economic interest of the community  at
\nlarge.’\t Freedom  of contract is of little  value  when\t one
\nparty  has no alternative between accepting a set  of  terms
\nproposed by the other or doing without the goods or services
\noffered.  Many\tcontracts  entered into\t by  public  utility
\nundertakings  and  others take the form of a  set  of  terms
\nfixed in advance by one party and not open to discussion  by
\nthe other. These are called ‘contracts d’adhesion’ by French
\nlawyers.  Traders frequently contract, not  on\tindividually
\nnegotiated terms, but on those contained in a standard\tform
\nof contract settled by a trade association. And the
\n264<\/span>
\nterms of an employee’s contract of employment may be  deter-
\nmined by agreement between his trade union and his employer,
\nor  by a statutory scheme of employment.  Such\ttransactions
\nare  nevertheless contracts notwithstanding that freedom  of
\ncontract is to a great extent lacking.”\n<\/p>\n
    This  Court has observed in Central Inland Water  Trans-
\nport  Corporation  Ltd. and Anr. v. Brojo Nath\tGanguly\t and
\nAnr.. (supra)as under:\n<\/p>\n
\t  ….\tArticle 14 of the Constitution guarantees to
\nall persons equality before the law and the equal protection
\nof the laws. The principle deducible from the above  discus-
\nsions  on this part of the case is in consonance with  right
\nand  reason, intended to secure social and economic  justice
\nand conforms to the mandate of the great equality clause  in
\nArticle\t 14.  This  principle is that the  courts  will\t not
\nenforce and will, when called upon to do so, strike down  an
\nunfair and unreasonable contract, or an unfair and unreason-
\nable clause in a contract. entered into between parties\t who
\narc  not equal in bargaining power  …..  It will apply  to
\nsituations  in\twhich the weaker party is in a\tposition  in
\nwhich he can obtain goods or services or means of livelihood
\nonly  upon  the terms imposed by the stronger  party  or  go
\nwithout them.”\n<\/p>\n
    The Court has. therefore, the jurisdiction and power  to
\nstrike or set aside the unfavourable terms in a contract  of
\nemployment  which purports to give effect to  unconscienable
\nbargain violating Art. 14 of the Constitution
\n    Thus  on a conspectus of the catena of cases decided  by
\nthis  Court the only conclusion follows is  that  Regulation
\n9(b) which confers powers on the authority to terminate\t the
\nservices of a permanent and confirmed employee by issuing  a
\nnotice terminating the services or by making payment in lieu
\nof  notice  without assigning any reasons in the  order\t and
\nwithout\t giving any opportunity of hearing to  the  employee
\nbefore\tpassing\t the  impugned order  is  wholly  arbitrary,
\nuncanalised and unrestricted violating principles of natural
\njustice\t as well as Article 14 of the Constitution.  It\t has
\nalso  been held consistently by this Court that the  Govern-
\nment carries on various trades and business activity through
\nthe instrumentality of the State such as Government  Company
\nor Public Corporations. Such Government Company or
\n265<\/span>
\nPublic Corporation being State ‘instrumentalities are  State
\nwithin the meaning of Article 12 of the Constitution and  as
\nsuch  they  are\t subject to the\t observance  of\t fundamental
\nrights\tembodied  in Part III as well as to conform  to\t the
\ndirective  principles  in Part IV of  the  Constitution.  In
\nother words the Service Regulations or Rules framed by\tthem
\nare to be tested by the touchstone of Article 14 of  Consti-
\ntution. Furthermore, the procedure prescribed by their Rules
\nor  Regulations\t must be reasonable, fair and just  and\t not
\narbitrary, fanciful and unjust. Regulation 9(b),  therefore,
\nconfers\t unbridled, uncanalised and arbitrary power  on\t the
\nauthority to terminate the services of a permanent  employee
\nwithout recording any reasons and without conforming to\t the
\nprinciples of natural justice. There is no guideline in\t the
\nRegulations or in the Act, as to when or in which cases\t and
\ncircumstances this power of termination by giving notice  or
\npay  in\t lieu  of notice can be exercised. It  is  now\twell
\nsettled\t that  the ‘audi alteram partem’ rule which  is\t es-
\nsence,\tenforces  the equality clause in Article 14  of\t the
\nConstitution is applicable not only to quasi-judicial orders
\nbut  to\t administrative orders affecting  prejudicially\t the
\nparty-in-question  unless  the application of the  rule\t has
\nbeen  expressly\t excluded by the Act or Regulation  or\tRule
\nwhich is not the case here. Rules of natural justice do\t not
\nsupplant but supplement the Rules and Regulations. Moreover,
\nthe  Rule  of Law which permeates our  Constitution  demands
\nthat it has to be observed both substantially and procedure-
\nly. Considering from all aspects Regulation 9(b) is  illegal
\nand void as it is arbitrary, discriminatory and without\t any
\nguidelines  for\t exercise of the power. Rule of\t law  posits
\nthat  the power to be exercised in a manner which  is  just,
\nfair  and reasonable and not in an unreasonable,  capricious
\nor arbitrary manner leaving room for discrimination. Regula-
\ntion 9(b) does not expressly exclude the application of\t the
\n‘audi alteram partern’ rule and as such the order of  termi-
\nnation\tof service of a permanent employee cannot be  passed
\nby simply issuing a month’s notice under Regulation 9(b)  or
\npay  in\t lieu thereof without recording any  reason  in\t the
\norder  and  without giving any hearing to  the\temployee  to
\ncontrovert the allegation on the basis of which the purport-
\ned order is made.\n<\/p>\n
     It\t will be profitable to refer in this connection\t the
\nobservations of this Court in the case of Union of India and
\nAnr.  v. Tulsiram Patel and Ors.,<\/a> [1985] Supp. (2)  SCR\t 131
\nwhere  the constitutionality of provisions of Art. 311\tpar-
\nticularly the 2nd proviso to clause (2) of ‘the said Article
\ncame up for consideration. This Court referred to the  find-
\nings  in Roshan Lal Tandon v. Union of India,<\/a> [1968]  1\t SCR
\n185 wherein it was held that though the origin of a  Govern-
\nment service is contractual
\n266<\/span>
\nyet  when once appointed to his post or office, the  Govern-
\nment  servant acquires a status and his rights\tand  obliga-
\ntions  are no longer determined by the consent of  both\t the
\nparties,  but  by statute or statutory rules  which  may  be
\nframed and altered unilaterally by the Government. In  other
\nwords,\tthe legal position of a Government servant  is\tmore
\none  of status than of contract. The hall-work of status  is
\nthe attachment to a legal relationship of rights and  duties
\nimposed\t by the public law and not by mere agreement of\t the
\nparties.  It has been observed that Art. 14 does not  govern
\nor  control  Art. 311. The Constitution must be\t read  as  a
\nwhole.\tArt. 311(2) embodies the principles of natural\tjus-
\ntice  including audi alteram partem rule. Once the  applica-
\ntion of clause (2) is expressly excluded by the Constitution
\nitself,\t there can be no question of making applicable\twhat
\nhas  been so excluded by seeking recourse to Article  14  of
\nthe Constitution.\n<\/p>\n
    In the case of Sukdev Singh & Ors. v. Bhagatrarn  Sardar
\nSingh  Raghuvanshi  & Anr. (supra), Mathew, J.\tpointed\t out
\nthat:\n<\/p>\n
\t  “The\tgoverning  power wherever  located  must  be
\nsubject to the fundamental constitutional limitations.”\n<\/p>\n
    This  has  been referred to and relied upon\t in  Central
\nInland\tWater Transport Corporation Ltd. and Anr.  v.  Brojo
\nNath  Ganguly and Anr.<\/a> (supra) and a similar Rule  9(i)\t was
\ntermed\tas “Henry VIII clause” as it confers  arbitrary\t and
\nabsolute power upon the Corporation to terminate the service
\nof a permanent employee by simply issuing a notice or pay in
\nlieu  thereof without recording any reason in the order\t and
\nwithout giving any opportunity of hearting to the  employee.
\nThus,  the Rule 9(i) of the Services Discipline\t and  Appeal
\nRules,\t1979  was held void under Section 23 of\t the  Indian
\nContract Act, 1872, as being opposed to public policy and is
\nalso  ultra vires of Article 14 of the Constitution  to\t the
\nextent\tthat  it confers upon the Corporation the  right  to
\nterminate  the employment of a permanent employee by  giving
\nhim  three  months’ notice in writing or by paying  him\t the
\nequivalent of three months’ basic pay and dearness allowance
\nin lieu of such notice.\n<\/p>\n
    Regulation 9(b) of the impugned Regulation framed  under
\nthe Delhi Transport Corporation Act which is in pare materia
\nwith  the  said Rule 9(i) is void under Section\t 23  of\t the
\nContract  Act as being opposed to public policy and is\talso
\nultra vires of Article 14 of the Constitution.
\n    Another  crucial  question is to consider  how  far\t the
\nimpugned  provisions  of Regulation 9(b)  framed  under\t the
\nDelhi Road Transport
\n267<\/span>
\nAct  can be read down in order to save it  from\t unconstitu-
\ntionality.  Several decisions have been cited at the bar  in
\norder to impress upon the Court that the impugned provisions
\nhave  been made for public purposes and for public  interest
\nand  as\t such it should be read down in a manner  that\twill
\nsave  the said provisions from the on-slaught  of  constitu-
\ntional invalidity.\n<\/p>\n
    In\tthe case of Commissioner of Sales Tax,\tMadhya\tPra-
\ndesh,  Indore and Ors. v. Radhakrishnan and Ors.,  [1979]  2
\nSCC  249 it has been held by this Court that for  sustaining
\nthe  presumption  of constitutionality, the court  may\ttake
\ninto  consideration matters of common knowledge, matters  of
\ncommon report, the history of the times and may assume every
\nstate of facts which can be conceived and can even read down
\nthis section.\n<\/p>\n
    It\tis convenient to mention here the meaning and  scope
\nof  the\t word ‘reading down’ and ‘Severance’ dealt  with  on
\npage  7, para B in Australian Federal Constitutional Law  by
\nColin Howard which reads as follows:\n<\/p>\n
“The High Court presumes the validity of legislation to\t the
\nextent that it will not of its own motion raise questions of
\nconstitutionality.  Legislation is treated as  valid  unless
\nthe  parties  to litigation challenge it  on  constitutional
\ngrounds.  The  techniques of construction known\t as  reading
\ndown and severance are corollaries of this presumption.
\n\t  Reading  down\t puts into operation  the  principle
\nthat so far as it is reasonably possible to do so,  legisla-
\ntion  should be construed as being within power. It has\t the
\npractical effect that where an Act is expressed in  language
\nof  a generality which makes it capable, if read  literally,
\nof  applying  to  matters beyond  the  relevant\t legislative
\npower, the court will construe it in a more limited sense so
\nas to keep it within power.\n<\/p>\n
XX\t\t\t   XX\t\t\t      XX\nXX\t\t\t   XX\t\t\t      XX\n<\/pre>\n
It does not necessarily follow that because a statute cannot
\nbe read down it is wholly invalid. The presumption of valid-
\nity leads naturally to the view that where a statute  cannot
\nbe held wholly valid it should be held valid at least to the
\n268<\/span>
\nextent\tthat it is reasonably possible or practicable to  do
\nso.  Where  reading  down is not available  the\t court\tnext
\ndecides where there is a case for severing the invalid parts
\nof  the\t statute from the parts which, standing\t alone,\t are
\nvalid.\tIf  this  can be done the court\t declares  only\t the
\ninvalid\t parts to be beyond power and leaves  the  remainder
\noperative.\n<\/p>\n
    In\tRe The Hindu Women’s Rights to Property\t Act,  1937,
\nand  The Hindu Women’s Rights to Property  (Amendment)\tAct,
\n1938 and in Re a Special Reference under Section 2 13 of the
\nGovernment  of India Act, 1935, [1941] FCR 12  the  question
\narose whether the Hindu Women’s Rights to Property Act, 1937
\n(Central Act XVIII of 1937) and the Hindu Women’s Rights  to
\nProperty (Amendment) Act, 1938 (Central Act XI of 1938), are
\napplicable to agricultural land and what was the meaning  of
\nthe word ‘property’. It was observed that:\n<\/p>\n
“When a Legislature with limited and restricted powers makes
\nuse  in an Act of a word of such wide and general import  as
\n“property”, the presumption must be that it is using it with
\nreference to that kind of property with respect to which  it
\nis competent to legislate and to no other. The word “proper-
\nty” in the Hindu Women’s Right to Property Act must  accord-
\ningly  be  construed  as referring to  property\t other\tthan
\nagricultural land.\n<\/p>\n
\t There\tis a general presumption that a\t Legislature
\ndoes not intend to exceed its jurisdiction.”\n<\/p>\n
    In\tthe case of R.M.D. Chamarbaugwalla v. The  Union  of
\nIndia,<\/a> [1957] SCR 930 the petitioners who had been promoting
\nand conducting prize competitions in the different States of
\nIndia,\tchallenged the constitutionality of ss. 4 and  5  of
\nthe  Prize Competitions Act (42 of 1955) and rr. 11  and  12
\nframed\tunder  s. 20 of the Act on the\tgrounds\t that  prize
\ncompetition  as defined in s. 2(d) of the Act  included\t not
\nmerely competitions that were of a gambling nature but\talso
\nthose  in which success depended to a substantial degree  on
\nskill  and the sections and the rules violated their  funda-
\nmental\tright to carry on business, and\t were  unsupportable
\nunder Act. 19(6) of the Constitution, that they\t constituted
\na single inseverable enactment and, consequently. must\tfail
\nentirely.  It  was held that validity  of  the\trestrictions
\nimposed\t by ss. 4 and 5 and rr 11 and 12 of the Act  as\t re-
\ngards gambling competitions was no longer open to  challenge
\nunder Art. 19(6) of the Constitution in view of the decision
\nof this Court that gambling did not
\n269<\/span>
\nfall  within the purview of Art. 19(1)(g) of  the  Constitu-
\ntion.\n<\/p>\n
It has been further observed that:\n<\/p>\n
“When  a question arises as to the interpretation to be\t put
\non  an enactment, what the Court has to do is  to  ascertain
\n“the  intent of them that make it” and that must of  course.
\nbe   gathered\tfrom  the  words  actually   used   in\t the
\nstatute. …………  To arrive at the real meaning, it  is
\nalways\tnecessary  to get an exact conception  of  the\taim,
\nscope and object of the whole Act  ……….  To decide the
\ntrue  scope  of\t the present Act, therefore,  we  must\thave
\nregard to all such factors as can legitimately be taken into
\naccount\t in ascertaining the intention of  the\tlegislature,
\nsuch  as  the history of the legislation  and  the  purposes
\nthereof, the mischief which it intended to suppress and\t the
\nother  provisions of the statute, and construe the  language
\nof  s.\t2(d) in the light of the  indications  furnished  by
\nthem.”\n<\/p>\n
    Having regard to the circumstances, it was held that the
\nlaw  which the State Legislatures moved Parliament to  enact
\nunder  Art.  252(1) was one to control\tand  regulate  prize
\ncompetitions of a gambling character and as such it was held
\nthat  the  Act was valid It has been further  observed\tthat
\nwhere the legislation falls in part within the area allotted
\nto  it and in part outside it, it is undoubtedly void as  to
\nthe latter.\n<\/p>\n
    In the case of R. 1. Arora v. State of Uttar Pradesh and
\nOrs., [1964] 6 SCR 784 challenge was thrown to the constitu-
\ntionality  of the amendments made to Ss. 40, 41 and s. 7  by
\nthe  Land Acquisition Amendment Act (Act 31 of 1962) on\t the
\nground\tthat it contravened Art. 31(2) inasmuch as it  makes
\nacquisition for a company before July 20, 1962 as being\t for
\na  public  purpose  even though it may not be  so  in  fact.
\nSection 7 was also challenged on the ground that it  contra-
\nvenes Art. 14 inasmuch as it makes an unreasonable discrimi-
\nnation\tin  the matter of acquisition for a  company  before
\nJuly  20,  1962 and after that date insolaf  as\t the  former
\nacquisitions  are  validated  on the basis  of\ttheir  being
\ndeemed to be for a public purpose while the latter  acquisi-
\ntions  are  not so deemed and have to satisfy  the  test  of
\npublic purpose.\n<\/p>\n
    it has been held that if the language of a provision  of
\nlaw is capable of only one construction and if according  to
\nthat construction
\n270<\/span>
\nthe provision contravenes a constitutional provision it must
\nbe  struck down. A literal interpretation is not always\t the
\nonly  interpretation  of a provision in a  statute  and\t the
\ncourt has to look at the setting in which the words are used
\nand the circumstances in which the law came to be passed  to
\ndecide whether there is something implicit behind the  words
\nactually used which would control the literal meaning of the
\nwords used. It has been further held following the  observa-
\ntions  in  The Mysore State Electricity Board  v.  Bangalore
\nWoollen,  Cotton and Silk Mills Ltd. & Ors.,<\/a> [1963] Supp.  2
\nSCR  127 that it is well settled that if certain  provisions
\nof  law\t construed in one way will be  consistent  with\t the
\nConstitution and if another interpretation would render them
\nunconstitutional  the  court  would bear in  favour  of\t the
\nformer construction.\n<\/p>\n
    In the case of Jagdish Pandey v. The Chancellor  Univer-<\/a>
\nsity of Bihar & Anr., [1968] 1 SCR 23 1 the challenge was to
\nthe  constitutionality of s. 4 of Bihar\t State\tUniversities
\n(University of Bihar, Bhagalpur and Ranchi) (Amendment)\t Act
\n13 of 1962 as discriminatory and violative of Art. 14 of the
\nConstitution.  It has been urged that s. 4  confers  uncana-
\nlised powers on the Chancellor without indicating any crite-
\nrion  on  the  basis of which the power under s.  4  can  be
\nexercised. It has been observed that:\n<\/p>\n
”  ……  There is no doubt that if one reads s. 4 literal-
\nly it does appear to give uncanalised powers to the Chancel-
\nlor  to do what he likes on the recommendations of the\tCom-
\nmission\t with respect to teachers covered by it. We  do\t not
\nhowever think that the Legislature intended to give such  an
\narbitrary power to the Chancellor. We are of opinion that s.
\n4  must\t be  read down and if we read it down  there  is  no
\nreason\tto hold that the legislature was conferring a  naked
\narbitrary power on the Chancellor.”\n<\/p>\n
    Seervai in his book ‘Constitutional Law of India’, Third
\nEdition has stated at p. 119 that:\n<\/p>\n
”   ….   the Court are guided by the\tfollowing  rules  in
\ndischarging  their solemn duty to declare laws passed  by  a
\nlegislature unconstitutional:\n<\/p>\n
(1)  There is a presumption in favour  of  constitutionality
\nand  a law will not be declared unconstitutional unless\t the
\ncase is so clear as to be free from doubt; “to doubt the
\n271<\/span>
\nconstitutionality of a law is to resolve it in favour of its
\nvalidity.”\n<\/p>\n
   ………………………………………
\n   ………………………………………
\n(6)  A\tStatute cannot be declared  unconstitutional  merely
\nbecause in the opinion of the Court it violates one or\tmore
\nof the principles of liberty, or the spirit of the Constitu-
\ntion,  unless such principles and that spirit are  found  in
\nthe terms of the Constitution.”\n<\/p>\n
    On\ta proper consideration of the cases cited  hereinbe-
\nfore  as  well as the observations of Seervai  in  his\tbook
\n‘Constitutional Law of India’ and also the meaning that\t has
\nbeen  given in the Australian Federal Constitutional Law  by
\nCoin  Howard, it is clear and apparent that where  any\tterm
\nhas  been used in the Act which per se seems to\t be  without
\njurisdiction  but can be read down in order to make it\tcon-
\nstitutionally  valid  by separating and excluding  the\tpart
\nwhich  is  invalid or by interpretting the word\t in  such  a
\nfashion\t in  order  to make it\tconstitutionally  valid\t and
\nwithin jurisdiction of the legislature which passed the said
\nenactment  by reading down the provisions of the Act.  This,
\nhowever, does not under any cicumstances mean that where the
\nplain  and literal meaning that follows from a bare  reading
\nof  the\t provisions of the Act, Rule or Regulation  that  it
\nconfers arbitrary, uncanlised, unbridled, unrestricted power
\nto  terminate the services of a permanent  employee  without
\nrecording  any reasons for the same and without adhering  to
\nthe  principles of natural justice and equality\t before\t the
\nlaw  as envisaged in Article 14 of the Constitution,  cannot
\nbe read down to save the said provision from  constitutional
\ninvalidity by bringing or adding words in the said  legisla-
\ntion  such  as saying that it implies that reasons  for\t the
\norder  of termination have to be recorded.  In\tinterpreting
\nthe  provisions of an Act, it is not permissible  where\t the
\nplain language of the provision gives a clear and  unambigu-
\nous meaning can be interpreted by reading down and presuming
\ncertain expressions in order to save it from  constitutional
\ninvalidity.  Therefore,\t on  a consideration  of  the  above
\ndecisions,  it\tis impossible to hold by  reading  down\t the
\nimpugned provisions of Regulation 9(b) framed under s. 53 of
\nthe  Delhi  Road Transport Act, 1950 read  with\t Delhi\tRoad
\nTransport (Amendment) Act, 1971 that the said provision does
\nnot confer arbitrary, unguided, unrestricted and uncanalised
\npower  without any guidelines on the authority to  terminate
\nthe services of an employee without conforming to the  prin-
\nciples of natural justice and equality as
\n272<\/span>
\nenvisaged in Article 14 of the Constitution of India. I\t am,
\ntherefore,  constrained to uphold the judgment of the  Delhi
\nHigh  Court  in C.W.P. No. 1422 of 1985\t and  dismiss  Civil
\nAppeal\tNo.  2876 of 1986. I allow Civil Appeal\t No.1115  of
\n1976 and agree with the order proposed to be passed  thereon
\nby the learned Chief Justice. The other appeals as  referred
\nto in detail in the judgment of the learned Chief Justice be
\nplaced\tbefore the Division Bench of this Court to  be\tdis-
\nposed of in accordance with the observations made herein.  I
\nagree  with conclusion arrived of by my learned\t brother  K.
\nRamaswamy, J.\n<\/p>\n
    SHARMA.J. I have gone through the judgments prepared  by
\nthe learned Chief Justice and by my other learned  Brothers.
\nIn view 01 the elaborate consideration by them of the  ques-
\ntions  raised  by the parties, from both points of  view.  I
\nproceed\t to indicate my conclusions without further  discus-
\nsion.\n<\/p>\n
    I  agree with the learned Chief Justice that the  rights
\nof  the parties in the present cases cannot be\tgoverned  by
\nthe general principle of master and servant, and the manage-
\nment  cannot  have  unrestricted and  unqualified  power  of
\nterminating  the services of the employees. In the  interest
\nof  efficiency\tof the public bodies, however.\tthey  should
\nhave the authority to terminate the employment of  undesira-
\nble, inefficient, corrupt. indolent and disobedient  employ-
\nees. but it must be exercised fairly, objectively and  inde-
\npendently: and the occasion for the exercise must be  delim-
\nited  with precision and clarity. Further, there  should  be
\nadequate reason for the use of such a power. and a  decision
\nin this regard has to be taken in a manner which should show
\nfairness.  avoid  arbitrariness and evoke  credibility.\t And
\nthis.  in my view, is possible only when the law  lays\tdown
\ndetailed  guidelines in unambiguous and precise terms so  as
\nto  avoid the danger of misinterpretation of the  situation.
\nAn  element  of uncertainty is likely to lead to  grave\t and
\nundesirable consequences. Clarity and precision are.  there-
\nfore. essential for the guidelines. Examining in this  back-
\nground,\t I am of the view that Regulation 9(b) of the  Delhi
\nRoad  Transport\t Authority  (Condition\tof  Appointment\t and
\nService)  Regulation,  1952  cannot be upheld  for  lack  of
\nadequate and appropriate guidelines. For these reasons Civil
\nAppeal No. 2876 of 1986 is dismissed.\n<\/p>\n
    I also agree that the Civil Appeal No. 1115\/76 should be
\nallowed\t in  the  terms indicated in  the  judgment  of\t the
\nlearned\t Chief\tJustice.  The other cases  shall  be  placed
\nbefore a division bench for final disposal.\n<\/p>\n
273<\/span><\/p>\n
      SAWANT..J.  I had the advantage of reading  the  judg-
\nments  of  the\tlearned Chief Justice and B.C.\tRay  and  K.
\nRamaswamy,  JJ. While with respect I agree with the  conclu-
\nsion  of  the  learned Chief Justice  in  Civil\t Appeal\t No.
\n1115\/76,  with utmost respect to him, I am unable  to  share
\nhis view of law on the subject in Civil Appeal No.  2876\/86.
\nI  am  in respectful agreement with the view  on  the  point
\nexpressed  by Ray and Ramaswamy, JJ. in the said  Civil\t Ap-
\npeal. I give my separate reasons for the same.
\n    The\t only  question\t involved in all  these\t matters  is
\nwhether\t the absolute power given to the Management  of\t the
\npublic undertakings under their respective rules\/regulations
\nto  terminate the services of an employee without  assigning
\nany reason, is constitutionally valid.\n<\/p>\n
    2. It is not necessary to refer to the facts and service
\nrules  in  each case. It will be sufficient if\tI  reproduce
\nhereinbelow  the relevant service regulation of one  of\t the
\npublic undertakings, viz., Delhi Transport Corporation (DTC’
\nfor  short)  the  validity of which is in  question  in\t the
\npresent\t case. The said regulation being Regulation 9(b)  of
\nthe  Delhi Road Transport Authority (Conditions of  Appoint-
\nment  & Service) Regulations, 1952 (hereinafter referred  to
\nas the “Regulations”) reads as follows:\n<\/p>\n
\t    Termination of service: (a) Except as  otherwise
\nspecified  in  the appointment orders, the  services  of  an
\nemployee  of  the Authority may be  terminated\twithout\t any
\nnotice or pay in lieu of notice:\n<\/p>\n
(i) During the period of probation and without assigning any
\nreasons thereof,\n<\/p>\n
(ii) For misconduct,
\n(;,ii) On the completion of specific period of appointment,\n<\/p>\n
(iv)  In  the case of employees engaged on  contract  for  a
\nspecific period, on the expiration of such period in accord-
\nance with the terms of appointment.\n<\/p>\n
\t   (b)\tWhere the termination is made due to  reduc-
\ntion  of establishment or in circumstances other than  those
\nmentioned at (a) above, one month’s notice or pay in lieu
\n274<\/span>
\nthereof will be given to all categories of employees.\n<\/p>\n
\t (c)  Where a regular\/temporary employee  wishes  to
\nresign\tfrom  his post under the Authority  he\tshall  given
\nthree\/one  month’s notice in writing or pay in lieu  thereof
\nto the Authority provided that in special cases, the General
\nManager may relax, at his discretion, the condition  regard-
\ning  the  period  of notice of resignation or  pay  in\tlieu
\nthereof.”\n<\/p>\n
    It will be obvious from the provisions of clause (b) the
\nabove  that it applies not only in the case of\tretrenchment
\nof  employees on account of reduction in  the  establishment
\nbut  also  in circumstances other than\tthose  mentioned  in
\nclause\t(a). The circumstances mentioned in clause  (a)\t are\n<\/p>\n
(i)  probationary period, (ii) misconduct, (iii)  completion
\nof  specific  period of appointment and (iv)  expiration  of
\ncontractual  period of appointment when the  appointment  is
\ncontractual. In other words, when the management decides  to
\nterminate  the services of an employee but not for his\tmis-
\nconduct\t ‘or during his probation or because his  tenure  of
\nappointment,  contractual or otherwise, has come to an\tend,
\nit  is\tfree to do so without assigning any  reason  and  by
\nmerely giving either a notice of the specific period or\t pay
\nin  lieu  of such notice. Reduced  to  simple  non-technical
\nlanguage, clause (b) contains the much hated and abused rule
\nof  hire and fire reminiscent of the days of  laissez  faire
\nand  unrestrained freedom of contract. There is\t no  dispute
\nthat  although\tthe language differs, the substance  of\t the
\nrelevant  rules of the other public undertakings  which\t are
\nbefore us, is the same and hence what applies to  Regulation
\n9(b)  of the Regulations will apply equally to the  relevant
\nrules of the other undertakings as well.\n<\/p>\n
    3.\tThe contentions advanced before us on behalf of\t the
\nmanagements  of\t the undertakings acknowledge  at  the\tvery
\noutset that such a service rule without anything further was
\nnot  only ultra vires the Constitution but was\tindefensible
\nin  law\t even otherwise being opposed to the  principles  of
\nnatural justice vesting as it does the naked arbitrary power
\nin  the\t management. The contention, however, was  that\t the
\nrule  had to be read down to imply that the power vested  by
\nit could be exercised only in certain circumstances and\t for
\nvalid  reasons and not otherwise. It was  further  contended
\nthat  the rigour of the rule is mitigated because the  power
\ngranted by it is exercised by a high ranking officer. It was
\nalso  urged that the exercise of the said power can be\tcon-
\ntrolled by holding that it is open to scrutiny by the court,
\nin individual cases. In other words, the contention was that
\nthe rule by itself
\n275<\/span>
\nis  innocent and legal and its movements are  properly\tcon-
\ntrolled\t being\tunder elderly care. Its\t occasional  wayward
\nbehaviour in unguarded moments can be corrected by chastise-
\nment by the courts. But the rule, it was solemnly urged, was
\nnecessary since otherwise the management of the undertakings
\nwill be well-high impossible. The controversy before us thus
\nlies  in a narrow compass, viz., whether the  rule  whatever
\nits  admitted demerits, should continue to blot the  statute
\nbook  because  it is necessary and will be used\t in  certain
\ncircumstances  only and its use in any\tother  circumstances
\ncan be checked by the Court.\n<\/p>\n
    4. It can at once be discerned that at the bottom of all
\nthe lengthy ardent arguments lies an anxiety not to  specify
\nthe  circumstances under which the power given by  the\trule
\nwill  be  exercised on the spacious plea that  such  circum-
\nstances cannot be stated in advance and in the interests  of
\nthe administration of the undertakings it is best that\tthey
\nare  not so stated. For once I thought that the\t framers  of
\nour  Constitution had committed an irretrievable mistake  by
\nignoring  the interests of the Union and the  State  Govern-
\nments  and  enumerating\t such circumstances  in\t the  second
\nproviso\t to Article 311(2) of the Constitution. But  then  I
\nwas  mistaken.\tThe  interests of  the\tpublic\tundertakings
\nappear\tto be more important than those of the\tGovernments.
\nMay be they are super-Governments. By claiming the privilege
\nnot  to enumerate even the broad guidelines as contained  in
\nArticle\t 311(2),  the managements of  the  undertakings\t are
\nindeed wearing a supercrown. The posture adopted by them  is
\nall the more obdurate and untenable in law when they ask the
\ncourt  to read down the rule, and read in  it  circumstances
\nunder  which the power can be used, but maintain  that\tthey
\nwill under no circumstances mend it nor should they be asked
\nto do it, by incorporating in it those very circumstances.\n<\/p>\n
    5.\tWith  this prologue to the controversy,\t I  may\t now
\nexamine the contentions advanced before us. It is  contended
\nthat  it  is  necessary to retain the rule  in\tits  present
\nambiguous  form\t because it is not possible to\tenvisage  in
\nadvance all the circumstances which may arise  necessitating
\nits  use. When we asked the learned counsel for the  manage-
\nments  whether there were any circumstances which would\t not
\nbe  governed  by the broad guidelines given  in\t the  second
\nproviso to subclause (2) of Article 311 of the Constitution,
\nand why at least such intelligible guidelines should not  be
\nincorporated  in  the rule, we received no reply.  We  could
\nappreciate  the embarrassment of the counsel, and as  stated
\nearlier.  there lies the nub of the matter. What this  Court
\nin  the various decisions has struck down is a similar\trule
\nin its present naked form without any guideline\t whatsoever,
\nbroad or
\n276<\/span>
\notherwise.  It was never the argument on behalf of  the\t em-
\nployees\t nor  indeed  is it to-day before us  that  all\t the
\npossible circumstances in which the rule may be used  should
\nbe  enumerated in it. Their argument has been that at  least
\nthe broad circumstances under which its exercise may  become
\nnecessary  should be incorporated to avoid an arbitrary\t use
\nor rather the abuse of power, and to guarantee the  security
\nof employment. That argument has been accepted by this Court
\nin the past by holding that such a rule is violative of\t the
\nConstitution  and was not necessary to safeguard the  inter-
\nests of the undertakings or the interests of the public. The
\ndecisions which appear to take an inconsistent view show  on
\nclose  analysis that either they were not dealing  with\t the
\nvalidity of the rule or were rendered when the dimensions of
\nboth Articles 14 and 21 were not expanded as they have\tbeen
\nsubsequently.\n<\/p>\n
    6.\tIn  the\t year 1990, it is not necessary\t for  me  to
\ndiscuss\t in  detail the authorities which have\twidened\t the
\nhorizons  of Article 14 of the Constitution. Some  of  these
\nprecedents  are\t directly  on the point in as  much  as\t the
\nvalidity  of similar service rules was considered there.  It
\nis  enough if I summarise the position of law as it  obtains
\nto-day.\n<\/p>\n
    There is need to minimise the scope of the arbitrary use
\nof  power in all walks of life. It is inadvisable to  depend
\non  the good sense of the individuals,\thowever\t high-placed
\nthey may be. It is all the more improper and undesirable  to
\nexpose the precious rights like the rights of life,  liberty
\nand  property  to the vagaries of the individual  whims\t and
\nfancies. It is trite to say that individuals are not and  do
\nnot become wise because they occupy high seats of power, and
\ngood sense, circumspection and fairness does not go with the
\nposts, however high they may be. There is only a complaisant
\npresumption  that  those who occupy high posts have  a\thigh
\nsense  of responsibility. The presumption is  neither  legal
\nnor  rational. History does not support it and reality\tdoes
\nnot  warrant  it.  In particular, in a\tsociety\t pledged  to
\nuphold the rule of law, it would be both unwise and  impoli-
\ntic  to leave any aspect of its life to be governed by\tdis-
\ncretion\t when it can conveniently and easily be\t covered  by
\nthe rule of law.\n<\/p>\n
    The employment under the public undertakings is a public
\nemployment and a public property. It is not only the  under-
\ntakings\t but  also the society which has a  stake  in  their
\nproper\tand efficient working. Both discipline and  devotion
\nare  necessary for efficiency. To ensure both,\tthe  service
\nconditions  of those who work for them must be\tencouraging,
\ncertain\t and  secured,\tand not vague  and  whimsical.\tWith
\ncapricious service conditions, both discipline and  devotion
\nare endan-\n<\/p>\n
277<\/span><\/p>\n
gered, and efficiency is impaired. –\n<\/p>\n
    The\t right\tto life includes right\tto  livelihood.\t The
\nright to livelihood therefore cannot hang on to the  fancies
\nof individuals in authority. The employment is not a  bounty
\nfrom them nor can its survival be at their mercy. Income  is
\nthe  foundation of many fundamental rights and when work  is
\nthe sole source of income, the right to work becomes as much
\nfundamental.  Fundamental rights can ill-afford to  be\tcon-
\nsigned\tto  the limbo of undefined  premises  and  uncertain
\napplications. That will be a mockery of them.
\n    Both  the society and the individual  employees,  there-
\nfore,  have an anxious interest in service conditions  being
\nwell-defined and explicit to the extent possible. The  arbi-
\ntrary  rules,  such as the one under discussion,  which\t are
\nalso  sometimes described as Henry VIII Rules, can  have  no
\nplace in any service conditions.\n<\/p>\n
    These are the conclusions which flow from Sukhdev  Singh
\n& Ors. v. Bhagatram Sardar Singh Raghuvanshi & Anr.,<\/a>  [1975]
\n3  SCR\t619; Maneka Gandhi v. Union of India,<\/a> [1978]  2\t SCR
\n621;  The  Manager, Government Branch Press & Anr.  v.\tD.B.
\nFelliappa,<\/a>  [1979] 1 SCC 477; Managing Director, Uttar\tPra-
\ndesh Warehousing Corporation & Anr. v. Vinay Narayan Vajpay-
\nee, [1980] 2 SCR 773; A.L. Kalra v. The Project &  Equipment
\nCorporation  of India Limited,<\/a> [1984] 3 SCR 646; Workmen  of
\nHindustan Steel Ltd. & Anr. v. Hindustan Steel Ltd. &  Ors.,<\/a>
\n[1985] 2 SCR 428; West Bengal State Electricity Board & Ors.
\nv. Desh Bandhu Ghosh & Ors.,<\/a> [1985] 2 SCR 1014; Olga  Tellis
\n&  Ors. v. Bombay Municipal Corporation & Ors.<\/a> etc.,  [1985]
\nSupp.  2 SCR 51; Union of India & Anr. v. Tulsiram  Patel  &
\nOrs.,<\/a>  [1985] Supp. 2 SCR 13 1; Central Inland Water  Trans-
\nport  Corporation Ltd. & Anr. v. Brojo Nath Ganguly  &\tAnr.
\netc.,  [1986]  3 SCR 156; O.P. Bhandari\t v.  Indian  Tourism
\nDevelopment Corporation Ltd. & Ors.,<\/a> [1986] 4 SCC 337;\tN.C.
\nDalwadi v. State of Gujarat,<\/a> [1987] 3 SCC 611; M.K.  Agarwal
\nv.  Gurgaon  Gramin Bank & Ors.,<\/a> [1987] Supp.  SCC  643\t and
\nDaily  Rated Casual Labour employed under P &  T  Department
\nthrough\t Bhartiya  Dak Tar Mazdoor Manch etc.  v.  Union  of
\nIndia & Ors., [1988] 1 SCC 122.\n<\/p>\n
    7. Since, before us the rule in question which admitted-
\nly  did\t not lay down explicit guidelines for  its  use\t was
\nsought\tto be defended only on two grounds, viz.,  that\t the
\npower  conferred by it is to be exercised only by  high\t au-
\nthorities and that it is capable of being read down to imply
\ncircumstances under which alone it can be used, I need\tdeal
\nonly with the said grounds.\n<\/p>\n
278<\/span><\/p>\n
    8.\tThe  “high authority” theory so-called\thas  already
\nbeen  adverted\tto  earlier. Beyond  the  self-deluding\t and
\nself-asserting\trighteous presumption, there is\t nothing  to
\nsupport\t it. This theory undoubtedly weighed with  some\t au-
\nthorities  for\tsome time in the past. But  its\t unrealistic
\npretensions were soon noticed and it was buried without even
\nso much as an ode to it. Even while Shah, J. in his dissent-
\ning opinion in Moti Ram Deka etc. v. General Manager, N.E.P.
\nRailways, Maligaon, Pandu, etc., [1964] 5 SCR 683 had  given
\nvent  to  it, Das Gupta, J. in his concurring  judgment\t but
\ndealing\t with the same point of unguided provisions of\tRule
\n148(3) of the Railway Establishment Code, had not  supported
\nthat view and had struck down the rule as being violative of
\nArticle\t 14 of the Constitution. The majority did  not\tdeal
\nwith  this  point at all and struck down the Rule  as  being
\nvoid on account of the discrimination it introduced  between
\nrailway servants and other government servants.
\n    The reliance placed on the decision in Shri Ram  Krishna
\nDalmia v. Shri Justice S.R. Tendolkar & Ors.,<\/a> [1959] SCR 279
\nto  support  the above theory is also according\t to  me\t not
\ncorrect.  As has been pointed out there, the  Commission  of
\nInquiry\t Act, 1952, the validity of which was challenged  on
\nthe  ground of unguided powers to institute  inquiries,\t was
\nnot  violative\tof  Article 14 because the  long  title\t and
\nSection 3 of the Act had contained sufficient guidelines for
\nexercise of the power. Section 3 has stated that the  appro-
\npriate\tgovernment can appoint a Commission of Inquiry\tonly
\nfor  the purpose of making inquiry into any definite  matter
\nof public importance. It is in the context of this guideline
\nin  the Act, that it is further stated there that even\tthat
\npower is to be exercised by the government and not any petty
\nofficial.  Hence  a bare possibility that the power  may  be
\nabused cannot per se invalidate the Act itself. The proposi-
\ntion of law stated there is to be read as a whole and not in
\nits  truncated\tform. The authority does not  lay  down\t the
\nproposition  that  even in the absence\tof  guidelines,\t the
\nconferment of power is valid merely because the power is  to
\nbe  exercised by a high official. It must further be  remem-
\nbered  that in this case, the contention was  that  although
\nthe  appropriate government was given power to appoint\tCom-
\nmission of Inquiry into any definite matter of public impor-
\ntance,\tthe delegation of power was excessive since  it\t was
\nleft  to  the government to decide for itself in  each\tcase
\nwhat  constituted such matter. The court repelled the  argu-
\nment by pointing out that “definite matter of public  impor-
\ntance”\tconstituted sufficient guideline to the\t government.
\nIt  was\t not, therefore, a case of no guideline but  of\t the
\nabsence of details of the guideline.\n<\/p>\n
279<\/span><\/p>\n
    Of similar nature is the reliance placed on the decision
\nin  The\t Collector of Customs, Madras v.  Nathella  Sampathu
\nChetty & Anr.,<\/a> [1962] 3 SCR 786 for the proposition that the
\npossibility  of\t the abuse of the powers is  no\t ground\t for
\ndeclaring  the\tprovision to be unreasonable  or  void.\t The
\nrelevant  observations are made while repelling the  conten-
\ntion  there that the burden thrown under provisions of\tSec-
\ntion  178A of the Sea Customs Act, 1878 on the possessor  of
\nthe goods to show that they were not smuggled was  violative
\nof Article 19(1)(f) and (g) of the Constitution. The  obser-
\nvations are as follows:\n<\/p>\n
“The possibility of abuse of a statute otherwise valid\tdoes
\nnot  impart  to it any element of invalidity.  The  converse
\nmust  also follow that a statute which is otherwise  invalid
\nas being unreasonable cannot be saved by its being  adminis-
\ntered in a reasonable manner. The constitutional validity of
\nthe statute would have to be determined on the basis of\t its
\nprovisions  and on the ambit of its operation as  reasonably
\nconstrued.  If so judged it passes the test  of\t reasonable-
\nness,  possibility of the powers conferred being  improperly
\nused is no ground for pronouncing the law itself invalid and
\nsimilarly if the law properly interpreted and tested in\t the
\nlight of the requirements set out in Part III of the Consti-
\ntution does not pass the test it cannot be pronounced  valid
\nmerely\tbecause it is administered in a manner\twhich  might
\nnot conflict with the constitutional requirements. In saying
\nthis  we are not to be understood as laying down that a\t law
\nwhich  might operate harshly but still\tbe  constitutionally
\nvalid  should  be  operated always with\t harshness  or\tthat
\nreasonableness\tand justness ought not to guide\t the  actual
\nadministration of such laws.”\n<\/p>\n
The  statute  there was saved by the provisions\t of  Article
\n19(6)  of the Constitution and was otherwise valid.  It\t was
\nnot a case of a provision which was constitutionally invalid
\nbeing  saved by recourse to the spacious assumption  of\t its
\nreasonable exercise in individual cases.\n<\/p>\n
    In\tTata Oil Mills Co. Ltd. v. Workmen & Anr.,<\/a> [1964]  2
\nSCR  125, it was a case of an employee of a private  company
\nwho was given a discharge simpliciter. This Court  following
\nits earlier decisions on the point observed that in  several
\ncases,\tcontract of employment or Standing Orders  authorise
\nan  industrial employer to terminate the employee’s  service
\nby giving one month’s notice or salary of one month in\tlieu
\nof notice and normally an employer may, in a proper
\n280<\/span>
\ncase  be  entitled to exercise the power.   But\t where\tsuch
\norder  gives rise to an industrial dispute, the form of\t the
\norder  would not be decisive and the industrial\t adjudicator
\nwould be entitled to probe it to find out whether it is mala
\nfide or is made in colourable exercise of the power.   Being
\na  private  employment, the power so conferred was  not\t as-
\nsailed\ton  the ground that it violated Article\t 14  of\t the
\nConstitution.\tI fail to understand the reliance placed  on
\nthis authority to support the appellants’ case before us.\n<\/p>\n
     9.\t  The  other  authorities relied on  behalf  of\t the
\nappellants  have  similarly no relevance to the\t point.\t  In
\nJyoti  Pershad v. The Administrator<\/a> for the Union  Territory
\nof Delhi, [1962] 2 SCR 125, the Slum Clearance Act which was
\nchallenged  there contained enough guidelines for the  exer-
\ncise  of  the power.  In Municipal  Corporation\t of  Greater
\nBombay v. P.S. Malvenkar & Ors.,<\/a> [1978] 3 SCR 1000, Order 26
\nof the Standing Orders and Service Regulations which was  in
\nquestion  there required reasons to be given  for  effecting
\ntermination simpliciter of an employee.\t In Organo  Chemical
\nIndustries & Anr. v. Union of India & Ors.,<\/a> [1980] 1 SCR 61,
\nSection\t 143 of the Provident Fund Act which was  challenged
\nwas  held to be valid since the Act contained enough  guide-
\nlines  for imposing penal damages.  In Champaklal  Chimanlal
\nShah v. The Union of India,<\/a> [1964] 5 SCR 190, Rule 5 of\t the
\nCentral Civil Services (Temporary Services) Rules, 1949\t was
\nchallenged  on\tthe  ground that  it  discriminated  between
\ntemporary  and permanent employees.  There was no  challenge
\nto  the absolute power given by the said rule  to  terminate
\nthe services of temporary employees.  In Ram Gopal Chaturve-
\ndi  v. State of Madhya Pradesh, [1970] 1 SCR 472, it  was  a
\ncase  of  termination of a  temporary  Government  servant’s
\nservices.  In Air India Corporation, Bombay v. V.A. Rebellow
\n& Anr.,<\/a> [1972] 3 SCR 606, the challenge was to the  termina-
\ntion  of services on the ground that it was done in  colour-
\nable exercise of power under Regulation 48 of the Air  India
\nEmployees’ Service Regulations.\t The said regulation was not
\nchallenged  on\tthe ground that it  gave  unchannelised\t and
\nunguided power of terminating the services of employees.  In
\nHira  Nath Mishra & Ors. v. The Principal, Rajendra  Medical
\nCollege, Ranchi and Anr.,<\/a> [1973] 1 SCC 805, it was the\tcase
\nof  the expulsior of students from college for two  academic
\nsessions  pursuant to the order passed by the  Principal  of
\nthat college.  The expulsion was effected following a confi-
\ndential complaint received from 36 girl students residing in
\nthe girls’ hostels alleging that the students in question  d
\nentered the compound of the girls’ hostels at belated  night
\nand walked without clothes on them.  The students were heard
\nbut  the  evidence of the girls was not\t recorded  in  their
\npresence.\n<\/p>\n
281<\/span><\/p>\n
The Court held that under the circumstances the requirements
\nof  natural justice were fulfilled since the  principles  of
\nnatural justice were not inflexible and differed in  differ-
\nent  circumstances. I have not been able to  appreciate\t the
\nrelevance of this decision to the point in issue.\n<\/p>\n
    10. I may now deal with the second contention vehemently
\nurged  on behalf of the appellants. The contention was\tthat
\nif  it is possible to save a legislation by reading it\tdown
\nto  read in it words, expressions or provisions,  it  should
\nnot  be struck down. In order to save the present  rule,  it
\nwas urged on behalf of the appellants that the Court  should
\nread  in it circumstances under which alone it can be  used.
\nWhat  precise circumstances should be read in  it,  however,
\nwas not stated by the learned counsel. I am afraid that\t the
\ndoctrine of reading down a statute has been wrongly  pressed
\ninto  service  in the present case. The\t authorities  relied
\nupon  by the learned counsel for the appellants not only  do
\nnot help the appellants but go against their case. It  would
\nbe better if I first deal with the authorities cited at\t the
\nBar  for  they will also bring out the correct\tmeaning\t and
\napplication of the said doctrine as well as its limitations.
\n    In\tRe The Hindu Women’s Rights to Property\t Act,  1937,
\nand  the Hindu Women’s Rights to Property  (Amendment)\tAct,
\n1938  etc.,  [19411 FCR 12 what fell for  consideration\t was
\nwhether\t the said two Act which were the Central  pieces  of
\nlegislation operated to regulate succession to\tagricultural
\nland in the then Governors’ Provinces. Admittedly, under the
\nscheme\tof  the then Government of India  Act,\t1935,  after
\nApril  1, 1937, the Central Legislature was  precluded\tfrom
\ndealing\t with the subjects numerated in List II of  the\t 7th
\nSchedule so far as the Governors’ Provinces were  concerned.
\nLaws  with respect to the “devolution of agricultural  land”
\ncould be enacted only by the Provincial Legislatures  (Entry
\nNo. 21 of List II) and wills, intestacy and succession, save
\nas regards agricultural land appeared as Entry No. 7 of List
\nIII,  i.e., the Concurrent List. Hence, it was obvious\tthat
\nthe  said Acts enacted as they were by the Central  Legisla-
\nture  could not have dealt with succession  to\tagricultural
\nland  so far as the Governors’ Provinces were concerned.  It
\nis  in these circumstances that the Federal Court  read\t the
\ntwo Acts of 1937 and 1938 as being not operative to regulate
\nsuccession to agricultural land in the Governors’  Provinces
\nbut  operative\tto regulate devolution\tby  survivorship  of
\nproperty  other\t than  agricultural land. It  will  thus  be
\nobvious\t that the limited purpose for which the doctrine  of
\nreading\t down was called into play in that case was  to\t ex-
\nclude  from the purview of the Act a subject which  was\t not
\nwithin\tthe competence of the legislature which had  enacted
\nit.\n<\/p>\n
282<\/span><\/p>\n
    In\tNalinakhya  Bysack v. Shyam Sunder  Haldar  &  Ors.,<\/a>
\n[1953]\tSCR 533 the expression “decree for recovery of\tpos-
\nsession”  in Section 18(1) of the West Bengal Premises\tRent
\nControl\t (Temporary Provisions) Act (XVII of 1950) fell\t for
\nconsideration,\tand the controversy was whether it  included
\nalso an order for recovery of possession made under  Section
\n43 of the Presidency Small Cause Court Act, 1882 and hence a
\nperson against whom an order under the latter provision\t was
\nmade  was  not\tentitled to claim relief  under\t the  former
\nprovision. In that connection the Court observed as follows:
\n“It  must always be borne in mind, as said by Lord  Halsbury
\nin  Commissioner for Special Purposes of Income Tax v.\tPem-
\nsel, LR 189 1 AC 53 1 at p. 549, that it is not competent to
\nany  Court to proceed upon the assumption that the  Legisla-
\nture  has  made\t a mistake. The Court must  proceed  on\t the
\nfooting that the Legislature intended what it has said. Even
\nif  there  is  some defect in the phraseology  used  by\t the
\nLegislature the Court cannot, as pointed out in Crawford  v.
\nSpooner,  6  Moo.  PC 1; 4 MIA 179;  aid  the  Legislature’s
\ndefective  phrasing of an Act or add and amend or,  by\tcon-
\nstruction,  make up deficiencies which are left in the\tAct.
\nEven where there is a casus omissus, it is, as said by\tLord
\nRussel\tof Killowen in Hansraj Gupta v. Official  Liquidator
\nof Dehra Dun-Mussoorie Electric Tramway Co. Ltd., [1933]  LR
\n60  IA\t13;  AIR 1953 PC 63 for others than  the  Courts  to
\nremedy\tthe defect. In our view it is not right to  give  to
\nthe word “decree” a meaning other than its ordinary accepted
\nmeaning\t and we are bound to say, in spite of  our  profound
\nrespect\t for the opinions of the learned Judges who  decided
\nthem,  that  the several cases relied on by  the  respondent
\nwere not correctly decided.”\n<\/p>\n
    In R.M.D. Chamarbaugwalla v. The Union of India,<\/a>  [1957]
\nSCR 930, more or less a similar situation arose. The Parlia-
\nment  had enacted the Prize Competitions Act to provide\t for
\nthe  control and regulation of the prize  competitions,\t and
\nSection\t 2  of the Act had defined “Prize  Competitions”  to
\nmean  “any  competition (whether called\t a  crossword  prize
\ncompetition,  a\t missing-word competition, a  picture  prize
\ncompetition  or\t by  any other name), in  which\t prizes\t are
\noffered for the solution of any puzzle based upon the build-
\ning up, arrangement, combination or permutation of  letters,
\nwords or figures”. The validity of.the restrictions  imposed
\nby  the Act was challenged as going beyond Article 19(6)  of
\nthe Constitution. The Court took a recourse to the
\n283<\/span>
\ndoctrine  of  reading down and held that the  definition  of
\nprize  competition given in Section 2(d) of the Act  had  in
\nview  only such competitions as were of gambling nature\t and
\nno others. The Court further held there that in interpreting
\nan enactment the Court should ascertain the intention of the
\nlegislature  not merely from a literal meaning of the  words
\nused but also from such matters as the history of the legis-
\nlation,\t its  purpose  and the mischief which  it  seeks  to
\nsuppress.\n<\/p>\n
    In\tKedar Nath Singh v. State of Bihar, [1962]  Supp.  2
\nSCR 769, the challenge was to the constitutional validity of
\nSection 124A of the Indian Penal Code. Two views were before
\nthis Court with regard to the ambit of the said section. One
\nwhich  held  that words, deeds or writings  constituted\t the
\noffence\t of sedition under the said section only  when\tthey
\nhad the intention or tendency to disturb public tranquility,
\nto  create  public disturbance or to promote  disorder.\t The
\nother  view was that it was not an essential  ingredient  of
\nthe  offence  of sedition under the said  section  that\t the
\nwords, deeds or writings should be intended to or be  likely
\nto  incite public disorder. The latter view of\tthe  section
\nwould  have  rendered it unconstitutional. It  is  in  these
\ncircumstances  that  this Court held that the  former  view’
\nshould be taken which would render the said section  consti-
\ntutional.  The\tCourt in that connection also  further\theld
\nthat keeping in mind the reasons for the introduction of the
\nsaid section and the history of sedition the former view was
\nthe correct interpretation of the ambit of the said section.
\n    In R.L. Arora v. State of Uttar Pradesh & Ors.,<\/a> [1964] 6
\nSCR  784,  the validity of Sections 40 and 41  of  the\tLand
\nAcquisition Act, 1894, and of Section 7 of the Amending Act,
\nwas  similarly upheld by placing on them construction  which
\nwould  render them constitutional. The\trelevant  provisions
\nwere  construed to mean that where land is acquired for\t the
\nconstruction  of  a  building or work  which  subserves\t the
\npublic purpose of the industry or work in which a company is
\nengaged\t or is about to be engaged, it can be said that\t the
\nland was acquired for a public purpose.\n<\/p>\n
    In Jagdish Pandey v. The Chancellor, University of Bihar
\n&  Anr.<\/a> [1968] 1 SCR 231, Section 4 of the Bihar State\tUni-
\nversities  (University\tof  Bihar,  Bhagalpur  and   Ranchi)
\n(Amendment)  Act 13 of 1962 was called in question as  being
\nviolative  of Article 14 of the Constitution on\t the  ground
\nthat the said section did not make any provision for  giving
\nthe  teacher a hearing before passing the order\t thereunder.
\nBy  that section, every appointment, dismissal etc.  of\t any
\nteacher\t of a college affiliated to the University (but\t not
\nbelonging to
\n284<\/span>
\nthe  State) made on or after 27th November, 1961 and  before
\n1st  March,  1962  was to be subject to such  order  as\t the
\nChancellor  of the University may on the  recommendation  of
\nthe University Service Commission established under  Section
\n48 of the said Act pass with respect thereto. The Court held
\nthat  the  said\t section was not invalid on  the  ground  of
\nunchannelised power given to the Chancellor because it never
\nauthorised  the\t Chancellor to scrutinise the  relevant\t ap-
\npointments for satisfying himself that they were in  accord-
\nance  with  University Act and its Statutes etc.  The  Court
\nfurther\t held that although the said section did not make  a
\nprovision  for giving the teacher a hearing  before  passing
\norder  thereunder,  such hearing must be read  in  the\tsaid
\nsection\t which the Commission had to give according  to\t the
\nprinciples of natural justice before making its\t recommenda-
\ntions to the Chancellor.\n<\/p>\n
    In Shri Umed v. Raj Singh & Ors., [1975] 1 SCR 918,\t one
\nof  the questions which fell for consideration\twas  whether
\nthe expression “to withdraw or not to withdraw from being  a
\ncandidate”  referred to the stage of withdrawal of  candida-
\nture under Section 37 and whether it applied to a  situation
\nwhere a contesting candidate announced that he does not wish
\nto  contest  the election or declared his intention  to\t sit
\ndown after the last date for withdrawal of candidature under
\nSection\t 37 had passed. Over-ruling its earlier decision  in
\nMohd.  Yunus Salim’s case AIR 1974 SC 12 18, the Court\theld
\nthat the function of the Court is to gather the intention of
\nthe legislature from the words used by it, and it would\t not
\nbe  right  for the Court to attribute an  intention  to\t the
\nlegislature which though not justified by the language\tused
\nby  it, accords with what the Court conceives to  be  reason
\nand  good sense and then bend the language of the  enactment
\nso  as to carry out such presumed intention of the  legisla-
\nture.  For the Court to do so would be to overstep its\tlim-
\nits. The Court also held that the words used by the legisla-
\nture  must  be construed according to  their  plain  natural
\nmeaning, and in order to ascertain the true intention of the
\nlegislature, the Court must not only look at the words\tused
\nby  the legislature but should also have regard to the\tcon-
\ntext and the setting in which they occur. The word “context”
\nhas  to be construed in a wide sense to mean all the  provi-
\nsions of the Act which bear upon the same subject matter and
\nthese  provisions  have to be read as a whole and  in  their
\nentirety  each throwing light and illumining the meaning  of
\nthe other.\n<\/p>\n
    In\tSunil  Batra etc. v. Delhi  Administration  &  Ors.,
\n[1973] 4 SCC 494 it was held that under Section 30(2)of\t the
\nPrisons Act which provided that a prisoner under sentence of
\ndeath shall be confined in a
\n285<\/span>
\ncell  apart from all other prisoners, did not mean  that  he
\nhas to be confined cellularly or separately from the rest of
\nthe  prisoners so as to put him in a  solitary\tconfinement.
\nThe  said  expression had a restricted meaning and  it\tonly
\nmeant that such a prisoner has to be kept in a separate cell
\nbut  one which is not away from the other cells.  Thus,\t the
\nsaid  expression,  viz. “shall be confined in a\t cell  apart
\nfrom  all  other prisoners” in the said provision  was\tread
\ndown to exclude solitary confinement.\n<\/p>\n
    In\tExcel Wear etc. v. Union of India & Ors.,  [1979]  1
\nSCR 1009, one of the questions before this Court was whether
\nthe  Court could read in Section 25-O (2) of the  Industrial
\nDisputes Act that it was incumbent on the authority to\tgive
\nreasons\t in his order for refusing permission to close\tdown
\nthe  undertaking.  The Court answered it  in  the  negative.
\nAlthough in the discussion that follows explicit reasons for
\nthe same are not found, it is legitimate to presume that the
\nCourt  did  not accept the said contention  because  of\t the
\nclear and explicit language of the said section.
\n    In\tMinerva Mills Ltd. & Ors. v. Union of India &  Ors.,<\/a>
\n[1981]\t1 SCR 206, the majority judgment has  discussed\t the
\nlimitations  of the doctrine of reading down which is  rele-
\nvant  for  our purpose. In that case, it  was  contended  on
\nbehalf of the State that Article 31C should be read down  so
\nas to save it from the challenge of unconstitutionality\t and
\nit  was urged that it would be legitimate to read into\tthat
\nArticle\t the intendment that only such laws would  be  immu-
\nnised from the challenge under Article 14 and 19 as did\t not
\ndamage\tor destroy the basic structure of the  Constitution.
\nThe Court opined that “to do so in that case would involve a
\ngross distortion of the principle of reading down  depriving
\nthat  doctrine of its only or true rationale when  words  of
\nwidth are used inadvertently.” According to the Court,\t“the
\ndevice of reading down is not to be resorted to in order  to
\nsave  the susceptibilities of the law makers, nor indeed  to
\nimagine a law of one’s liking to have been passed. One\tmust
\nat  least take the Parliament at its word when,\t especially,
\nit undertakes a constitutional amendment  …….
\n  ……….   If  the\tParliament has\tmanifested  a  clear
\nintention to exercise an unlimited power, it is\t impermissi-
\nble  to read down the amplitude of that power so as to\tmake
\nit limited. The principle of reading down cannot be  invoked
\nor  applied  in\t opposition to the clear  intention  of\t the
\nlegislature. We suppose that in the history of the constitu-
\ntional\tlaw, no constitutional amendment has ever been\tread
\ndown to mean the exact opposite of what it says and intends.
\nIn  fact,  to accept the argument that we should  read\tdown
\nArticle 31C, so as to make it
\n286<\/span>
\nconform to the ratio of the majority decision in Kesavananda
\nBharati, is to destroy the avowed purpose of Article 31C  as
\nindicated by the very heading “Saving of certain laws” under
\nwhich  Articles\t 31,  3 lB and 31C are\tgrouped.  Since\t the
\namendment to Article 31C was unquestionably made with a view
\nto empowering the legislatures to pass laws of a  particular
\ndescription  even  if those laws violate the  discipline  of
\nArticles  14 and 19, it seems to us impossible to hold\tthat
\nwe  should  still save Article 3 iC from  the  challenge  of
\nunconstitutionality by reading into that Article words which
\ndestroy\t the  rationale of that Article\t and  an  intendment
\nwhich is plainly contrary to its proclaimed purpose.”\n<\/p>\n
    The\t Court then dealt with the argument of\tthe  learned
\nAdditional Solicitor General who contended that it was still
\nopen to the Court under Article 3 IC of the Constitution  to
\ndecide whether the law enacted pursuant to it secured any of
\nthe Directive Principles of the State Policy and whether the
\nobject\tof  the Directive Principles could  not\t be  secured
\nwithout\t encroaching  upon the Fundamental  Rights  and\t the
\nextent to which encroachment was necessary and whether\tsuch
\nencroachment  violated the basic structure of the  Constitu-
\ntion.  The Court opined that this argument was open  to\t the
\nsame criticism to which the argument of Attorney General was
\nopen  and  that\t “it would be sheer adventurism\t of  a\tmost
\nextraordinary  nature  to  undertake the  kind\tof  judicial
\nenquiry which according to the learned Additional  Solicitor
\nGeneral,  the courts are free to undertake.” The Court\tfur-
\nther held that in the very nature of things it was difficult
\nfor  a\tcourt  to determine whether a  particular  law\tgave
\neffect to a particular policy and whether a law was adequate
\nenough to give effect to that policy. It was pointed out  by
\nthe  Court  that it was not possible for the  Court  to\t set
\naside  the law so enacted as invalid merely because  in\t the
\nopinion\t of  the Court, the law was not adequate  enough  to
\ngive  effect to that policy. The Court further\tpointed\t out
\nthat “the only question open to judicial review was  whether
\nthere was a direct and reasonable nexus between the impugned
\nlaw  and  the provisions of the\t Directive  Principles.\t The
\nreasonableness was to be examined with regard to such  nexus
\nand  not with regard to the impugned law. Hence, it was\t not
\nopen to the Court to undertake the kind of enquiry suggested
\nby  the Additional Solicitor General. That would involve  an
\nextensive  judicial review which was impermissible in  law.”
\nThe  Court then pointed out that where the express words  of
\nthe  statute  are clear and intended to give  power  without
\nlimitation, the statute cannot be saved by reading into them
\nwords and intendment of a diametrically opposite meaning and
\ncontent.  The  Court opined that provisions  such  as  these
\nprovide a
\n287<\/span>
\nstriking illustration of the limitations of the doctrine  of
\nreading down.\n<\/p>\n
    In\tUnion of India & Anr. etc. v. Tulsiram\tPatel  etc.,
\n[1985] 3 SCC 398 the majority judgment asserts that when the
\nstatute expressly excludes the rule of audi alteram  partem,
\nthere  is  no scope for reintroducing it by a  side-door  to
\nprovide the enquiry which has been expressly prohibited.
\n    In\tElliott\t Ashton Welsh, II v. United States,  398  US
\n333;  26 L. ed. 2nd 308 while making useful observations  on
\nthe  doctrine of reading down and of recasting the  statute,
\nin his concurring opinion Harlan, J. stated as follows:\n<\/p>\n
\t  “When the plain thrust of a legislative  enactment
\ncan only be circumvented by distortion to avert an  inevita-
\nble  constitutional collision, it is only by  exalting\tform
\nover  substance\t that one can justify this veering  off\t the
\npath  that  has been plainly marked by the statute.  Such  a
\ncourse\tbetrays extreme skepticism as to  constitutionality,
\nand,  in this instance, reflects a groping to  preserve\t the
\nconscientious objector exemption at all cost.
\n\t  I  cannot subscribe to a wholly  emasculated\tcon-
\nstruction  of a statute to avoid facing a  latent  constitu-
\ntional\tquestion,  in  purported fidelity  to  the  salutary
\ndoctrine of avoiding unnecessary resolution of constitution-
\nal  issues, a principle to which I fully adhere. It  is,  of
\ncourse,\t desirable  to salvage by  construction\t legislative
\nenactments  whenever  there is good reason to  believe\tthat
\nCongress  did not intend to legislate consequences that\t are
\nunconstitutional, but it is not permissible, in my judgment,
\nto take a lateral step that robs legislation of all  meaning
\nin order to avert the collision between its plainly intended
\npurpose and the commands of the Constitution.\n<\/p>\n
\t   It  must be remembered that although\t this  Court
\nwill  often strain to construe legislation so as to save  it
\nagainst\t constitutional\t attack, it must not  and  will\t not
\ncarry  this  to\t the point of perverting the  purpose  of  a
\nstatute\t … or judicially rewriting it. To put\t the  matter
\nanother\t way,  this  Court will not  consider  the  abstract
\nquestion  of  whether Congress might have  enacted  a  valid
\nstatute\t but instead must ask whether the statute that\tCon-
\ngress did enact will
\n288<\/span>
\npermissibly  bear  a  construction rendering  it  free\tfrom
\nconstitutional defects.\n<\/p>\n
\t The  issue comes sharply into focus in Mr.  Justice
\nCardozo’s statement for the Court in Moore Ice Cream Co.  v.
\nRose, 289 US 373,379; 77 L ed. 1245, 1270:\n<\/p>\n
\t    ‘A\tstatute must be construed, if fairly  possi-
\nble,  so  as  to avoid not only the conclusion\tthat  it  is
\nunconstitutional,   but\t  also\tgrave\tdoubts\t upon\tthat
\nscore.’\t …  But  avoidance of a  difficulty  will  not  be
\npressed\t to  the  point of disingenuous\t evasion.  Here\t the
\nintention  of  the Congress is revealed\t too  distinctly  to
\npermit\tus  to ignore it because of mere  misgivings  as  to
\npower. The problem must be faced and answered.”\n<\/p>\n
\t  If  an  important congressional policy  is  to  be
\nperpetuated  by recasting unconstitutional  legislation,  as
\nthe prevailing opinion has done here, the analytically sound
\napproach is to accept responsibility for this decision.\t Its
\njustification cannot be by resort to legislative intent,  as
\nthat  term is usually employed, but by a different  kind  of
\nlegislative  intent, namely the presumed grant of  power  to
\nthe  courts to decide, whether it more nearly  accords\twith
\nCongress’  wishes  to  eliminate its  policy  altogether  or
\nextend\tit  in\torder to render what  Congress\tplainly\t did
\nintend, constitutional.”\n<\/p>\n
    11.\t It is thus clear that the doctrine of reading\tdown
\nor of recasting the statute can be applied in limited situa-
\ntions. It is essentially used, firstly, for saving a statute
\nfrom being struck down on account of its  unconstitutionali-
\nty. It is an extention of the principle that when two inter-
\npretations are possible–one rendering it constitutional and
\nthe  other making it unconstitutional, the former should  be
\npreferred.  The unconstitutionality may spring\tfrom  either
\nthe incompetence of the legislature to enact the statute  or
\nfrom its violation of any of the provisions of the Constitu-
\ntion.  The second situation which summons its aid  is  where
\nthe provisions of the statute are vague and ambiguous and it
\nis possible to gather the intentions of the legislature from
\nthe  object of the statute, the context in which the  provi-
\nsion  occurs and the purpose for which it is made.  However,
\nwhen  the  provision is cast in a definite  and\t unambiguous
\nlanguage  and its intention is clear, it is not\t permissible
\neither\tto  mend  or bend it even if such  recasting  is  in
\naccord
\n289<\/span>
\nwith  good reason and conscience. In such circumstances,  it
\nis  not\t possible for the Court to remake the  statute.\t Its
\nonly duty is to strike it down and leave it to the  legisla-
\nture if it so desires, to amend it. What is further, if\t the
\nremaking  of  the statute by the courts is to  lead  to\t its
\ndistortion that course is to be scrupulously avoided. One of
\nthe  situations\t further  where the doctrine  can  never  be
\ncalled into play is where the statute requires an  extensive
\nadditions  and\tdeletions.  Not only it is no  part  of\t the
\ncourt’s\t duty to undertake such exercise, but it  is  beyond
\nits jurisdiction to do so.\n<\/p>\n
    12.\t Judged in the context of the above principles I  am
\nof  the\t view  that the doctrine cannot be  availed  of\t for
\nsaving\tthe present regulation- In the first  instance,\t the
\nregulation  is\ta  part of the service\tregulations  of\t the
\nemployees  made\t by the Delhi Road  Transport  Authority  in
\nexercise  of  the powers conferred by sub-section  (1)\tread
\nwith  clause  (c) of sub-section (2) of Section\t 53  of\t the
\nDelhi  Road Transport Act, 1950 (hereinafter referred to  as
\nthe  “Act”).  The object of the Act is to  provide  for\t the
\nestablishment and the regulation of Road Transport Authority
\nfor the promotion of a co-ordinated system of road transport
\nin the State of Delhi. There is nothing either in the object
\nof  the service regulations of which the present  regulation
\nis a part or in the object of the Act which has a bearing on
\nthe said Regulation 9(b). If anything, the object of the Act
\nwould  require framing of such service regulations as  would
\nensure dedicated and diligent employees to run the undertak-
\ning.  The  dedication  of the  employees  would\t pre-suppose
\nsecurity  of  employment and not a constant hanging  of\t the
\nDemocle’s sword over their head, and hence would in any case
\nnot  bear  the existence of such regulation.  Secondly,\t the
\nlanguage  of the regulation is so crystal clear that no\t two
\ninterpretations are possible to be placed on it and hence it
\nis not permissible to read in it any meaning other than what
\nis clearly sought to be conveyed by it. Thirdly, the context
\nof the said regulation makes it abundantly clear that it  is
\nmeant to be a naked hire and fire rule and the authority has
\nbeen  vested with unguided and arbitrary power\tto  dispense
\nwith  the  services of any category of the  employees.\tSub-
\nclause (a) of the said Regulation 9 mentions elaborately the
\ncircumstances  in which the services of an employee  can  be
\nterminated without any notice or pay in lieu of such notice.
\nSub-clause  (b)\t follows closely on its heel and  states  in
\nclear  language\t that when the termination is  made  due  to
\nreduction  of establishment or in circumstances\t other\tthan
\nthose mentioned in subclause (a), one month’s notice or\t pay
\nin  lieu  thereof is all that is necessary to be  given\t for
\nterminating  an\t employee’s services. The intention  of\t the
\nrule-making authority, therefore, is more than clear. It
\n290<\/span>
\nwas  to give an absolute free hand without  any\t limitations
\nwhatsoever  to terminate the services of any employee.\tBoth
\nthe  language  of the regulation as well as the\t context  in
\nwhich  it  is cast leave no scope for reading  into  it\t any
\nfurther provision. What is more, the kind of recasting which
\nis  suggested  on behalf of the appellants  would  not\tonly
\ndistort the intention of the rule-making authority but would
\nalso  require  extensive  amendment to it of  a\t very  vague
\nnature.\t The appellants suggest firstly that we should\tread
\ninto the regulation a provision that the concerned  employee
\nwould  be  given a hearing. The suggestion itself  begs\t the
\nquestion: Hearing for what? Is he to be heard with regard to
\nhis misconduct? If so, it will require that he should  first
\nbe  intimated of the misconduct of which he is\tguilty.\t But
\nthat kind of a situation is taken care of by sub-clause\t (a)
\nof  the said regulation. There is, therefore, no need  of  a
\nseparate provision for the same. If, on the other hand,\t the
\nservices  of  an employee are to be  terminated\t on  grounds
\nother  than  those mentioned in sub-clause (a),\t then  those
\ngrounds being unknown to the employee, cannot be met by\t him
\neven if he is given a hearing. The reading in the rule of  a
\nmere provision of a hearing is, therefore, meaningless.\t The
\nother  suggestion made on behalf of the appellants is  still
\nmore  objectionable. The suggestion was that we should\tread
\nin  the rule all circumstances where it is not\tpossible  or
\nnecessary to hold an enquiry. 1 thought that such situations
\nare  capable of being formulated easily and conveniently  at
\nleast in general terms as is done by the Constitution-makers
\nin the second proviso to Article 311(2). In fact, one of the
\npublic undertakings viz., Indian Airlines has come out\twith
\nsuch  regulation being amended Regulation 13 of its  Employ-
\nees’  Service Regulations, and the same has been  placed  on
\nrecord by them. What is necessary to note in this connection
\nis  that the reading of such circumstances in  the  existing
\nregulation  would require its extensive recasting  which  is
\nimpermissible  for the Court to do. 1 know of  no  authority
\nwhich  supports such wide reading down of any  provision  of
\nthe  statute or rule\/regulation. For all these\treasons\t the
\ndoctrine  of  reading  down is according  to  me  singularly
\ninapplicable  to the present case and the arguments in\tsup-
\nport of the same have to be rejected.\n<\/p>\n
    13.\t I am, therefore, of the view that there is no\tsub-
\nstance in this appeal. I would rather that the long departed
\nrule  rests  in peace at least now. Hence  I  dismiss  Civil
\nAppeal No. 2876\/86 with costs.\n<\/p>\n
    1 allow Civil Appeal No. 1115 of 1976 and agree with the
\norder  proposed\t to be passed therein by the  learned  Chief
\nJustice.\n<\/p>\n
291<\/span><\/p>\n
    The\t rest of the civil appeals, and Special Leave  Peti-
\ntion  (Civil) No. 7612 of 1987 be referred to  the  Division
\nBench for disposal in accordance with the opinion  expressed
\nin  Civil Appeal No. 2876 of 1986 hereinabove. The  applica-
\ntion for intervention are allowed.\n<\/p>\n
    K. RAMASWAMY, J: 1. These batch cases concern, a  refer-
\nence.  the  correctness\t of the ratio  rendered\t in  Central
\nInland Water Transport Company Limited v. Brojonath Ganguly,
\n[1986] 3 SCC. 156 = AIR 1986 SC 1571 (for short Brojo Nath).
\nThe  facts  in C.A. No. 2886\/86 lie in a short\tcompass\t and
\nsufficient for deciding the controversy are stated thus:\n<\/p>\n
    2.\tThe  Delhi Transport Corporation, a  statutory\tbody
\nterminated  the services of its three  permanent  employees,
\nthe  Conductor (R. 2), Asstt. Traffic Incharge (R.  3),\t and
\nthe  Driver (R. 4) for their alleged inefficiency, by  exer-
\ncising the power of Regulation 9(b) of Delhi Road  Transport
\nAuthority  (Conditions of appointment and Services)  Regula-
\ntion, 1952 (for short “the Regulation”) framed under section
\n53  of\tthe Delhi Road Transport Act, 1950 read\t with  Delhi
\nTransport  (Amendment) Act, 1971 (for short “the Act”).\t The
\nfirst respondent union assailed the validity of the  Regula-
\ntion which the High Court of Delhi struck it down as offend-
\ning  Articles 14 and 16 of the Constitution. The High  Court
\nsolely\trelied on the ratio in Brojo Nath whose\t correctness
\nis the subject of the reference: My learned brother, My Lord
\nthe  Chief  Justice extensively stated the argument  of\t the
\ncounsel on either side. Therefore, to avoid needless  burden
\non this judgment, I consider it redundant to reiterate\tthem
\nonce over.\n<\/p>\n
    3. Regulation 9(b) of the Regulations read thus:  Termi-
\nnation of Services:\n<\/p>\n
    “Whether  the  termination is made due to  reduction  of
\nestablishment or in circumstances other than those mentioned
\nin  (a)\t above, one. month’s notice or pay in  lieu  thereof
\nwill be given to all categories of employees” as is  similar
\nto  Rule 9 of the Rules in Brojo Nath’s case  (supra)  which
\nthis  Court declared to be Henry VIII clause, conferring  an
\nabsolute, arbitrary and unguided power upon that Corporation
\nand  was  held to be ultra vires of the\t provisions  of\t the
\nConstitution  and  was void under section 23 of\t the  Indian
\nContract Act. As stated earlier, the correctness thereof  is
\nthe primary question in these appeals.\n<\/p>\n
    4. Sri Ashok Desai, the learned Solicitor General  vehe-
\nmently\tcontended  that, under ordinary law of\t“master\t and
\nservant” the
\n292<\/span>
\nCorporation  is\t empowered  by the Contract  of\t Service  to
\nterminate  the services of its employees in  terms  thereof.
\nThe declaration in Brojo Nath’s case that such a contract is
\nvoid, under section 23 of the Indian Contract Act or opposed
\nto  public policy offending the Fundamental Rights  and\t the
\nDirective Principles, is not sound in law. He contends\tthat
\nas a master the Corporation has unbridled right to terminate
\nthe  contract in the interests of efficient  functioning  of
\nthe Corporation or to maintain discipline among its  employ-
\nees.  The termination, if is found to be wrongful, the\tonly
\nremedy\tavailable to the employees is to claim\tdamages\t for
\nwrongful termination but not a declaration as was granted in
\nBrojo  Nath’s  case. In support thereof, he  cited  passages
\nfrom Chitti on Contract, Halsbury’s Laws of England and\t the
\nratio  in Union of India v. Tulsiram PateI,<\/a> [1985]  Supp.  2
\nSCR  131 = AI 1985 SC. 1416. He also placed strong  reliance
\non  Industrial Law and the decisions of this Court cited  by
\nmy  learned  brother, the Chief\t Justice.  Alternatively  he
\ncontended  that the relevant regulations would be read\tdown
\nso  as\tto be consistent with Arts. 14 and 16(1)  read\twith
\nArt. 19(1)(g) of the Constitution and the authority invested
\nwith  such  power could in an appropriate  case,  report  to
\nterminate the services of an employee expeditiously  without
\nrecourse  to an elaborated enquiry and opportunity of  hear-
\ning.  The  latter contention of reading\t down  the  relevant
\nrules received support from the learned Attorney General Sri
\nSoli J. Sorabjee and other counsel appearing for the employ-
\ners. M\/s. M.K. Ramamurthi, R.K. Garg, and P.P. Rao,  learned
\ncounsel\t appearing for the employees resisted these  conten-
\ntions.\n<\/p>\n
    5.\tThe  main  controversy centres\tround  the  question
\nwhether the employer, Statutory Corporation or instrumental-
\nity or other authority under Art. 12 of the Constitution has
\nunbridled  power  to terminate the services of\ta  permanent
\nemployee  by issue of notice or pay in lieu thereof  without
\ninquiry or opportunity, in exercise of the power in terms of
\ncontract  which\t include statutory Rules or  Regulations  or
\ninstructions having force of law. It is undoubted that under
\nordinary law of master and servant, whether the contract  of
\nservice\t is  for  a fixed period or not, if  it\t contains  a
\nprovisions  for termination of service by notice,  in  terms
\nthereof,  it can be so determined and if the contract  finds
\nno provisions to give notice and the contract of service  is
\nnot  for a fixed period, law implies giving of a  reasonable
\nnotice.\t Where no notice or a reasonable notice was  issued,
\nbefore\tterminating  the contract, the\ttermination  of\t the
\ncontract  of service is wrongful and the aggrieved  employee
\nis  entitled at law to sue for damages. But this common\t law
\nprinciple could be applied to the employees, appointed by  a
\nStatutory  Corporation\tor authority or\t an  instrumentality
\nwithin
\n293<\/span>
\nthe meaning of Article 12 of the Constitution is the  square
\nquestion.  It  is  not disputed that  Delhi  Road  Transport
\nCorporation is a Statutory Corporation under the Act and the
\nRegulations are statutory and its employees are entitled  to
\nthe fundamental Rights enshrined in Part III of the  Consti-
\ntution.\t It is well settled law by a heed role of  decisions
\nof this Court that the Corporation or a Statutory  Authority
\nor  an instrumentality or other authority under Art.  12  of
\nthe  Constitution  is not free, like an ordinary  master  (a
\nprivate employer), to terminate the services of its  employ-
\nees  at its whim or caprices or vagary. It is bound  by\t the
\nAct  and the Regulation and the paramount law of  the  land,
\nthe Constitution.\n<\/p>\n
    Nature of the Power Statutory Authority to terminate the
\nservices of its employees.\n<\/p>\n
    6.\tIn Sukhdev Singh v. Bhagatram, [1975] 3 SCR.  619  =
\nAIR 1975 SC. 1331, the Constitution Bench of this Court\t put
\na  nail\t in the coffin of the play of the  private  master’s
\npower  to hire and fire his employees and held that  Regula-
\ntions  or  Rules  made under a Statute\tapply  uniformly  to
\neveryone or to all members of the same group or class.\tThey
\nimpose\tobligations on the statutory authorities who  cannot
\ndeviate\t from  the conditions of service and  any  deviation
\nwill  be enforced through legal sanction of  declaration  by
\nCourts\tto invalidate the actions in violation of the  Rules
\nor  Regulations. The statutory bodies have no free  hand  in
\nframing the terms or conditions of service of their  employ-
\nees. The Regulations bind both the authorities and also\t the
\npublic.\t The  powers of the statutory  bodies  are  derived,
\ncontrolled and restricted by the Statutes which create\tthem
\nand  the Rules and Regulations framed thereunder. The  Stat-
\nute, thereby fetters on the freedom of contract. Accordingly
\ndeclaration  was  granted that dismissal or  removal  of  an
\nemployee by statutory Corporation in contravention of statu-
\ntory provision as void. Mathew, J. in a separate but concur-
\nrent  judgment\theld  that a Public  Corporation  being\t the
\ncreation of a Statute is subject to statutory limitations as
\na State itself. The preconditions of this Part II viz., that
\nthe  corporation is created by Statute and the existence  of
\npower  in the corporation is to invade a statutory right  of
\nthe  individual.  Therefore,  the governing  power  must  be
\nsubject\t to fundamental statutory limitations. The  need  to
\nsubject the power centres to the control of the Constitution
\nrequires  an expansion of concept of State action. The\tduty
\nof  State is affirmative duty seeing that all essentials  of
\nlife  are made available to all persons. The task  of  State
\ntoday is to make the achievement of good life both by remov-
\ning obstacles in the path of such achievement and by assist-
\ning individual in realis-\n<\/p>\n
294<\/span><\/p>\n
ing  his  ideal\t of self-perfection.  The  employment  under
\npublic\tcorporation is a public employment  and,  therefore,
\nthe employee should have
\nthe protection which appurtains to public employment.\n<\/p>\n
\t\t\t\t   (emphasis supplied).\n<\/p>\n
The Court must, therefore, adopt the attitude that  declara-
\ntion is a normal remedy for a wrongful dismissal in case  of
\npublic employees which can be refused in exceptional circum-
\nstances.  The remedy of declaration should be a remedy\tmade
\nan  instrument\tto provide reinstatement in  public  sector.
\nThis principle was extended to numerous instances where\t the
\ntermination  of\t services of the employees  of\ta  statutory
\ncorporation  was affected in violation of the principles  of
\nnatural\t justice or in transgression of the statutory  rules
\netc. In U.P. State Warehousing Corporation v. N.V. Vajpayee,
\n[1980] 2 SCR 737 at p 780 F to G and 783G to 784A this Court
\nheld  that statutory body cannot terminate the\tservices  of
\nits  employees without due enquiry held in  accordance\twith
\nthe  principles\t of natural justice. The persons  in  public
\nemployment are entitled to the protection of Articles 14 and
\n16  of\tthe Constitution, when the service  was\t arbitrarily
\nterminated. The question, therefore, is whether the statuto-
\nry  corporations are entitled to be invested  with  absolute
\nfreedom to terminate the services of its employees in  terms
\nof the contract of service.\n<\/p>\n
    7.\tIn  Ramana  v. International  Airport  Authority  of
\nIndia,<\/a>\t[1979] 3 SCR. 1014 = (1979) SC. p. 1628\t this  Court
\nheld that expression of welfare and social service functions
\nnecessitates  the State to assume control over\tnatural\t and
\neconomic  resources and large scale natural  and  commercial
\nactivities.  For the attainment of  socio-economic  justice,
\nthere  is vast and notable increase of frequency with  which
\nordinary  citizens come into relationship of direct  encoun-
\nters  with the State. The Government in a welfare  state  is
\nthe regulator and dispenser of social services and  provider
\nof  large number of benefits, including jobs etc.  Thousands
\nof people are employed in Central\/State Government  Services
\nand also under local authorities. The Government, therefore,
\ncannot act arbitrarily. It does not stand in the same  posi-
\ntion as a private individual. In a democratic Government  by
\nrule of law, the executive Government or any of its officers
\ncannot\theld  to be possessed of arbitrary  power  over\t the
\ninterests of the individuals. Every action of the Government
\nmust  be informed with reason and should be free from  arbi-
\ntrariness.  That is the very essence of rule of law. It\t was
\nfurther held:\n<\/p>\n
“It  was, therefore, be taken to be the law that  where\t the
\nGovernment is dealing with the public, whether by way of
\n295<\/span>
\ngiving\tjobs  or entering into\tcontracts   ……….\t the
\nGovernment  cannot  act arbitrarily at its sweet  will\tand,
\nlike a private individual, deal with any person it  pleases,
\nbut  its action must be in conformity with standard of\tnorm
\nwhich, is not arbitrary, irrational or irrelevant. The power
\nof  discretion of the Government in the matter of  grant  of
\nlargess including award of jobs,   …………………….
\nmust be conditioned and structured by rational relevant\t and
\nnon-discriminatory  standard or norm and if  the  Government
\ndeparts from such standard or norm in any particular case or
\ncases,\tthe action or the Government would be liable  to  be
\nstruck\tdown, unless it can be shown by the Government\tthat
\nthe departure was not arbitrary, but was based on some valid
\nprinciple  which in itself was not irrational,\tunreasonable
\nor discriminatory.”\n<\/p>\n
    This statement of law, though was made in the context of
\ncontractual  relations, it is a general law with  width\t and
\namplitude  which permeates the entire spectrum\tof  actions,
\nlegislative as well as executive.\n<\/p>\n
    8. The Constitution is the permanent law of the land and
\nits preamble is an integral part thereof. It assures  Social
\nand Economic Justice and also accords equality of opportuni-
\nty and status as well as equality before law assuring digni-
\nty  of the individual. The Constitution Forty Second  Amend-
\nment  Act  introduced “Socialism” in the Preamble  and\tmade
\nexplicit  of  what is latent in the  Constitutional  Scheme.
\nArticle\t 14  accords equal protection of  law  and  equality
\nbefore\tlaw. Article 16(1) provides right to an\t appointment
\nor employment to an office or post under the State.  Article
\n19(1)(g)  assures right to occupation or avocation. Art.  21
\nassures\t right\tto life and any deprivation is\tas  per\t the
\nprocedure  established by law. In General Manager,  Southern
\nRailway\t v. Rangachari,<\/a> [1962] S.C.R. page 586 it  was\theld
\nthat  matters relating to employment would  include  salary,
\nincrements, leave, gratuity, pension, age of  superannuation
\netc.  Similarly,  in respect of appointments,  such  matters
\nwould  include all the terms and conditions of service\tper-
\ntaining\t to the said office. All those matters are  included
\nin  the\t expression “matters relating to employment  or\t ap-
\npointment” within the meaning of Art. 16(1) of the Constitu-
\ntion. This was reiterated in State of M.P.v. Shardul  Singh,
\n[19701\t3  S.C.R. page 302 at 305–306\tthat  conditions  of
\nservice\t include  holding of posts right from  the  time  of
\nappointment till his retirement beyond it like pension\tetc.
\nThe  middle  class, lower middle class\tand  lower  classes’
\neducated
\n296<\/span>
\nyouths\tgenerally,  if not mainly,-depend on  employment  or
\nappointment  to\t an office or posts under the  States  which
\ninclude\t corporations,\tstatutory  body\t or  instrumentality
\nunder Art. 12 of the Constitution as source to their liveli-
\nhood and means to improve their intellectual excellence\t and
\nliner  facets  of life individually and\t collectively  as  a
\nmember of the society so that himself and his dependents are
\neconomically  sound,  educationally  advanced  and  socially
\ndignified  so that the nation constantly rises to  standards
\nof higher level in an egalitarian social order under rule of
\nlaw as is obligated under Art. 51A(J ).\n<\/p>\n
Right to life scope of\n<\/p>\n
    9.\tThe  right to life, a basic human right\t assured  by
\nArt. 21 of the Constitution comprehends something more\tthan
\nmere animal existence i.e. dignity of the individual.  Field
\nJ.  in Munn v. Illinois, [1876] 94 US 113 and 154 held\tthat
\nby  the\t term “life” as here used, something more  is  meant
\nthan  mere  animal  existence. The  inhibition\tagainst\t its
\ndeprivation  extends  to all those limbs  and  faculties  by
\nwhich life is enjoyed. The deprivation not only of life\t but
\nof  …..  if it a efficacy be not lettered away by Judicial
\ndecision. In Kharak Singh v. State of U.P.,<\/a> [1964] 1 SCR 332
\nthis Court approved the definition of life given by Field J.
\nin his dissenting opinion. In Olga Tellis v. Bombay  Munici-<\/a>
\npal  Corporation,  [1985] 2 Suppl. SCR page 51\tat  79\tthis
\nCourt  further laid that an equally important facet  of\t the
\nright  to life is the right to livelihood because no  person
\ncan  live without the means of livelihood. If the  right  to
\nlivelihood  is not treated as a part of\t the  Constitutional
\nright to life, the easiest way of depriving a person of\t his
\nright to life would be to deprive him of his means of  live-
\nlihood to the point of abrogation  …..  That, which  alone
\ncan  make it possible to live, leave aside which makes\tlife
\nliveable, must be deemed to be an integral component of\t the
\nright  to life\t…..  The motive force which propels  their
\ndesertion  of their hearths and homes in the village is\t the
\nstruggle  for  survival, that is the struggle for  life.  So
\nunimpeachable  is  the nexus between life and the  means  of
\nlivelihood. Right to life does not only mean physicaI exist-
\nence but includes basic human dignity, vide Menaka Gandhi v.
\nUnion  of  India, [1978] 2 SCR 621 John Stuart Mill  in\t his
\n‘Consideration of Representative Govt.’ said years ago\tthat
\n“the  power of the State is to promote virtue  and  intelli-
\ngence  of  the people”. In State of Maharashtra\t v.  Chunder
\nBhan, [1983] 3 SCR 387 = AIR 1983 SC 803 Chinnappa Reddy, J.
\nheld that public employment opportunity is a national wealth
\nin  which  all citizens are equally entitled  to  share\t and
\nVaradarajan, J. held that public employment is the  property
\nof the nation which has to be shared equally. This rule
\n297<\/span>
\nwas  laid  when rule 15(1)(ii)(b’) of B.C.S.  Rules  to\t pay
\nsubsistence  allowance during period of suspension @  Rs.  1
\nper  month pending departmental enquiry was  challenged\t and
\ndeclared  the rule as ultra vires by operation of Arts.\t 14,
\n16, 21 and 311(2).\n<\/p>\n
    The right to public employment and its concomitant right
\nto  livelihood, thus, receive their succour and\t nourishment
\nunder  the  canopy of the protective umbrella of  Arts.\t 14,
\n16(1), 19(1)(g) and 21. Could statutory law arbitrarily take
\naway or abridged or abrogated it? In Board of Trustees, Port
\nof Bombay v. Dilip Kumar, [1983] 1 SCR 828 = AIR 1983 SC 109
\nthis  Court held that the expression “life” does not  merely
\nconnote\t animal\t existence or a continued  drudgery  through
\nlife,  the expression life has a much wider meaning.  Where,
\ntherefore, the, outcome of a departmental enquiry is  likely
\nto affect reputation or livelihood of a person, some of\t the
\nliner  graces of human civilisation which makes\t life  worth
\nliving\twould  be  jeopardised and the same can\t be  put  in
\njeopardy only by law which inheres fair procedure.\n<\/p>\n
     In Workmen of Hindustan Steels Ltd. v. Hindustan  Steel
\nLtd. & Ors.,<\/a> [1985] 2 SCR 428 it was held that the  standing
\norder  31 which confers arbitrary, uncanalised\tand  drastic
\npower on the Manager to dismiss an employee without enquiry,
\napart from being in violation of basic requirement of  natu-
\nral  justice,  is  such a drastic nature as  to\t effect\t the
\nlivelihood and put a stigma on the character of the workman.
\nIn Francis Corallie v. U.T. of Delhi, [1981] 2 SCR 516 = AIR
\n1981  SC  746 this Court held that “it is for the  Court  to
\ndecide, in exercise of its constitutional power of  judicial
\nreview, whether the deprivation of life or personal  liberty
\nin  a given case is by procedure which is  reasonable,\tfair
\nand  just and fair treatment”. The tests of reason and\tjus-
\ntice cannot be abstract nor can be divorced from the actual-
\nities  of life and the needs of the Society. The  tests\t ap-
\nplied must be pragmatic and purposive lest they cease to  be
\nreasonable.  Reasonableness must be meaningful\tand  effica-
\ncious in content as well as in form. The procedure  provided
\nin  Rule 9(b) or allied rules, therefore, must not be  just,
\nfair and reasonable so as to be in conformity with Arts.  14
\nand 21 is the cry of the case.\n<\/p>\n
10. The position of the public employee is whether status:\n<\/p>\n
     The  distinguishing  feature of  public  employment  is
\nstatus. In Roshanlal Tandon v. Union of India, [1968] 1\t SCR
\n185  at 195-196 the Constitution Bench held that  the  legal
\nposition of a Government servant is more one of status\tthan
\nof contract. The hall-mark of status
\n298<\/span>
\nis  the\t attachment to a legal relationship  of\t rights\t and
\nduties imposed by, the public law and not by mere  agreement
\nof the parties. The employment of the Government servant and
\nhis  terms of service are governed by statute  or  statutory
\nrules.\tOnce  he  is appointed to the post  or\toffice,\t the
\nGovernment  servant  acquires a status and  his\t rights\t and
\nobligations  are  no longer determined by  consent  of\tboth
\nparties but by Statute or Statutory Rules. The\trelationship
\nbetween\t the  Government  and its servants is  not  like  an
\nordinary  contract of service between a master and  servant.
\nThe  legal  relationship  is in the nature  of\tstatus.\t The
\nduties\tof statute are fixed by the law and in the  enforce-
\nment  of  the duties society has an interest.  Status  is  a
\ncondition  of  membership  of a group of  which\t powers\t and
\nduties\tare exclusively determined by law and not by  agree-
\nment between the parties concerned. In Calcutta Dock  Labour
\nBoard v. Jarfar Imam,<\/a> [1965] 3 SCR 463 it was held that\t the
\nstatutory  scheme  of  employment confers on  the  worker  a
\nstatus. An unlawful act is an interference with status. This
\nview  was  followed  in Sirsi Municipality  v.\tCecelia\t Kom
\nFrancis\t Tellis,<\/a> [1973] 3 SCR 348 Beg, J. (as he  then\twas)
\nheld  that  the principles applicable to the relation  of  a
\nPrivate Master and servant unregulated by statute, could not
\napply  to  the cases of a public statutory  body  exercising
\npowers\tof  punishment lettered or limited  by\tstatute\t and
\nrelevant rules of procedure. This Court in a recent decision
\nextended  all the benefits of pay scales to all the  Central
\nGovernment  Corporate Sector employees. It is, thus, I\thold
\nthat the employees of the corporations, statutory  authority
\nor instrumentality under Art. 12 have statutory status as  a
\nmember\tof  its employees. The rights  and  obligations\t are
\ngoverned  by the relevant statutory provisions and  the\t em-
\nployer\tand  employee are equally bound\t by  that  statutory
\nprovisions.\n<\/p>\n
11. Nature of the right of a permanent employee to a post
\n    In Purushottam Lal Dhingra v. Union of India,<\/a> [1958] SCR
\n828 at 84 1-843 it was held that the appointment to a perma-
\nnent post may be substantive or on probation or on officiat-
\ning basis. A substantive appointment to a permanent post  in
\na  public service confers normally substantive right to\t the
\npost and he becomes entitled to hold a lien on the post.  He
\nis entitled to continue in office till he attains the age of
\nsuperannuation as per rules or is dismissed or removed\tfrom
\nservice\t for inefficiency, misconduct or negligence  or\t any
\nother  disqualification\t in accordance\twith  the  procedure
\nprescribed in the rules, and fair and reasonable opportunity
\nof  being  heard or on compulsory retirement or\t in  certain
\ncircumstances, subject to the conditions like  re-employment
\non  abolition of post. In Motiram Daka v.  General  Manager,
\n[1964] 5
\n299<\/span>
\nSCR 683 at 718-721=AIR 1964 SC 600 at 608 & 609 majority  of
\nseven  Judges’\tBench held that a permanent post  carries  a
\ndefinite  rate of pay without a limit of time and a  servant
\nwho substantively holds a permanent post has a title to hold
\nthe post to which he is substantively appointed, and that in
\nterms,\tmeans that a permanent servant has a right  to\thold
\nthe  post  until, of course, he\t reaches  superannuation  or
\nuntil he is compulsorily retired under the relevant rule. If
\nfor  any other reason that right is invaded and he is  asked
\nto  leave  the service the termination of his  service\tmust
\ninevitably  mean  the  defeat of his right  to\tcontinue  in
\nservice\t and  as such, it is in the nature  of\tpenalty\t and
\namounts\t to removal. In other words, termination of  service
\nof a permanent servant, otherwise than on superannuation  of
\ncompulsory retirement, must per se amount to his removal and
\nso,  by\t Rule 148(3) or Rule 149(3)  of\t Rly.  Establishment
\nRules  if  such\t a termination is brought  about,  the\trule
\nclearly\t contravenes  Art.  311(2) and must be\theld  to  be
\ninvalid.  A permanent employment assures security of  tenure
\nwhich  is essential for the efficiency and  incorruptibility
\nof public administration. In Guruder Singh Sidhu v. State of
\nPepsu, [1964] 7 SCR 587 =AIR 1964 SC 1585 another  Constitu-
\ntion  Bench  held that for efficient administration  of\t the
\nState,\tit  is absolutely essential  that  permanent  public
\nservant\t should\t enjoy a sense of security  of\ttenure.\t The
\nsafeguard  which  Art. 311(2) affords is no more  than\tthis
\nthat  in case it is intended to dismiss or remove or  reduce
\nthem  in rank, a reasonable opportunity should be  given  to
\nthem  of  showing cause against the action  proposed  to  be
\ntaken  in regard to them. In Motiram Daka’s case (supra)  it
\nwas  further  held that in a modern  democratic\t State,\t the
\nefficiency and incorruptibility of public administration  is
\nof  such importance that it is essential to afford to  civil
\nservants adequate protection against capricious action\tfrom
\ntheir  superior authority. If a permanent civil\t servant  is
\nguilty\tof  misconduct,\t he should  no\tdoubt  be  proceeded
\nagainst\t promptly  under the  relevant\tdisciplinary  rules,
\nsubject,  of  course, to the safeguard\tprescribed  by\tArt.
\n311(2); but in regard to honest, straight-forward and  effi-
\ncient permanent civil servants, it is of utmost\t importance,
\neven  from the point of view of the State, that they  should
\nenjoy  a sense of security which alone can make\t them  inde-
\npendent\t and truly efficient. The sword of damocles  hanging
\nover the heads of permanent railway servants in the form  of
\nRule  148(3) or Rule 149(3) would inevitably create a  sense
\nof insecurity in the minds of such servants and would invest
\nappropriate  authorities  with very wide  powers  which\t may
\nconceivably be abused. Thereby this Court laid emphasis that
\na  permanent  employee has a right or lien on  the  post  he
\nholds until his tenure of service reaches superannuation  so
\nas  to earn pension at the evening of his life unless it  is
\ndetermined as
\n300<\/span>
\nper  law.  An assurance of security of service to  a  public
\nemployee is an essential requisite for efficiency and incor-
\nruptibility  of public administration. It is also an  assur-
\nance  to take independent drive and initiative in  the\tdis-
\ncharge of the public duties to alongate the goals of  social
\njustice set down in the Constitution.\n<\/p>\n
    This  Court\t in Daily Rated Casual Labour  v.  Union  of
\nIndia,<\/a> [1988] 1 SCR 598–[1988] 1 SCC 122 at 130-131 further
\nheld  that  the right to work, the right to free  choice  of
\nemployment,  the right to just and favourable conditions  of
\nwork, the right to protection against unemployment etc., and
\nthe  right to security of work are some of the rights  which
\nhave to be ensured by appropriate legislative and  executive
\nmeasures. It is true that all these rights cannot be extend-
\ned simultaneously. But they do indicate the socialist  goal.
\nThe degree of achievement in this direction depends upon the
\neconomic resources, willingness of the people to produce and
\nmore  than all the existence of industrial peace  throughout
\nthe  country.  Of those rights the question of\tsecurity  of
\nwork  is of most importance. If a person does not  have\t the
\nfeeling\t that he belongs to an organisation engaged in\tpro-
\nduction\t he will not put forward his best effort to  produce
\nmore.  (emphasis  supplied) That sense of  belonging  arises
\nonly when he feels that he will not be turned out of employ-
\nment  the next day at the whim of the management. It is\t for
\nthis reason it is being repeatedly observed by those who are
\nin charge of economic affairs of the countries in  different
\nparts of the world that as far as possible security of\twork
\nshould be assured to the employees so that they may contrib-
\nute to the maximisation of production.\n<\/p>\n
    12. It must, therefore, be held that a permanent employ-
\nee of a statutory authority, corporation or  instrumentality
\nunder Art. 12 has a lien on the post till he attains  super-
\nannuation or compulsorily retired or service is duly  termi-
\nnated  in accordance with the procedure established by\tlaw.
\nSecurity of tenure ensures the benefit of pension on retire-
\nment.  Dismissal, removal or termination of his\/her  service
\nfor  inefficiency, corruption or other misconduct is by\t way
\nof penalty. He\/ she has a right to security of tenure  which
\nis essential to inculcate a sense of belonging to the  serv-
\nice  or organisation and involvement for maximum  production
\nor  efficient service. It is also a valuable right which  is
\nto be duly put an end to only as per valid law.\n<\/p>\n
13. How to angulate the effect of termination of service
\nLaw  is a social engineering to remove the existing  irabal-
\nance and
\n301<\/span>
\nto further the progress, serving the needs of the  Socialist
\nDemocratic  Bharat under rule of law. The prevailing  social
\nconditions  and\t actualities of life are to  be\t taken\tinto
\naccount to adjudging whether the impugned legislation  would
\nsubserve the purpose of the society. The arbitrary,  unbrid-
\ndled and naked power of wide discretion to dismiss a  perma-
\nnent employee without any guidelines or procedure would tend
\nto defeat the constitutional purpose of equality and  allied
\npurposes referred to above. Courts would take note of  actu-
\nalities\t of life that persons actuated to corrupt  practices
\nare  capable,  to maneuver with higher echolons\t in  diverse
\nways and also camouflage their activities by becoming  syco-
\nphants or chronies to the superior officers. Sincere, honest
\nand  devoted subordinate officer unlikely to lick the  boots
\nof  the\t corrupt superior officer. They develop a  sense  of
\nself-pride  for\t their\thonesty, integrity  and\t apathy\t and
\ninertia\t towards the corrupt and tent to undermine  or\tshow
\nsigns of disrespect or disregard towards them. Thereby, they
\nnot only become inconvenient to the corrupt officer but also
\nstand  an impediment to the on-going smooth sipbony of\tcor-
\nruption at a grave risk to their prospects in career or even
\nto their tenure of office. The term efficiency is an elusive
\nand  relative  one  to the adept capable to  be\t applied  in
\ndiverse circumstances. if a superior officer develops  likes
\ntowards sycophant, tough corrupt, he would tolerate him\t and
\nfound  him to be efficient and pay encomiums and  corruption
\nin such eases stand no impediment. When he finds a  sincere,
\ndevoted and honest officer to be inconvenient, it is easy to
\ncast  him\/her off by writing confidential with\tdelightfully
\nvague language imputing to be ‘not upto the mark’,  ‘wanting
\npublic\trelations’ etc. Yet times they may be termed  to  be
\n“security  risk” (to their activities). Thus they spoil\t the
\ncareer\tof  the honest, sincere and  devoted  officers.\t In-
\nstances\t either way are gallore in this\t regard.  Therefore,
\none  would be circumspect, pragmatic and realistic to  these
\nactualities of life while angulating constitutional validity
\nof wide arbitrary, uncanalised and unbriddled  discretionary
\npower of dismissal vested in an appropriate authority either
\nby  a statute or a statutory rule. Vesting  arbitrary  power
\nwould  be a feeding ground for nepotism and  insolence;\t in-
\nstead  of  subserving the constitutional purpose,  it  would
\ndefeat\tthe  very object, in particular, when the  tribe  of
\nofficers  of honesty, integrity and devotion are  struggling
\nunder despondence to continue to maintain honesty, integrity
\nand  devotion to the duty, in particular, when moral  values
\nand  ethical  standards are fast corroding in all  walks  of
\nlife  including public services as well. It is but the\tneed
\nand  imperative of the society to pat on the back  of  those
\nband  of  honest,  hard-working officers  of  integrity\t and
\ndevotion  to  duty. It is the society’s interest  to  accord
\nsuch officers security of service and avenues of promotion.\n<\/p>\n
302<\/span><\/p>\n
    That apart, the haunting fear of dismissal from  service
\nat  the\t vagary of the concerned officer would\tdry  up\t all
\nsprings\t of  idealism  of the employee and  in\tthe  process
\ncoarsens the conscience and degrades his spirit. The  nobler
\nimpulses  of minds and the higher values of life  would\t not
\nco-exist  with fear. When fear haunts a man, happiness\tvan-
\nishes.\tWhere  fear is, justice cannot be,  where  fear\t is,
\nfreedom\t cannot be. There is always a carving in  the  human
\nfor  satisfaction of the needs of the spirit, by  arming  by
\ncertain freedom for some basic values without which life  is
\nnot  worth-living. It is only when the satisfaction  of\t the
\nphysical needs and the demands of the spirit coexists, there
\nwill be true efflorescence of the human personality and\t the
\nfree  exercise of individual faculties. Therefore, when\t the
\nConstitution assures dignity of the individual and the right
\nto  livelihood\tthe exercise of the power by  the  executive
\nshould be cushioned with adequate safeguards for the  rights
\nof  the employees against any arbitrary and capracicous\t use
\nof those powers.\n<\/p>\n
Contract  of service must be consistent with  the  Constitu-
\ntion.\n<\/p>\n
    14. From the above perspective vis-a-vis constitutional,
\nsocial\tgoals  and  rights of the citizens  assured  in\t the
\npreamble,  Parts  III & IV i.e. the  trinity,  the  question
\nwhether the statutory corporation or the instrumentality  or
\nthe  authority under Art. 12 of the Constitution is  validly
\nempowered to terminate the services of a permanent  employee
\nin  terms  of the contract of employment  or  rules  without
\nconducting  an\tenquiry or an opportunity of show  cause  of
\nproposed  order\t of termination of the service.\t The  Indian
\nContract  Act, 1872 operating in British India was  extended
\nto  the merged States in 1949 & 1950 except to the State  of
\nJammu & Kashmir. Therefore, after Bharat attained  independ-
\nence on August 15, 1947, the Indian Contract Act is applica-
\nble  to all States except Jammu & Kashmir. By  operation  of
\nArticle\t 372  of the Constitution, the Indian  Contract\t Act
\ncontinues  to be in operation subject to the  provisions  of
\nthe Constitution. The Indian Contract Act is an amending  as
\nwell as consolidating Act as held in Ramdas Vithaldas Durbar
\nv.S. Amerchand & Co., 43 Indian Appeals 164. Thereby  common
\nlaw principles applicable in England, if they are inconsist-
\nent  with  or  derogation to the provisions  of\t the  Indian
\nContract  Act or the Constitution to that extent they  stand
\nexcluded. Any law, muchless the provisions of Contract\tAct,
\nare  inconsistent with the fundamental rights which  guaran-
\nteed in Part III of the Constitution, by operation of  Arti-
\ncles  13 of the Constitution, are void. Section 2(h) of\t the
\nIndian\tContract  Act defines “an  agreement”  including  an
\nagreement of service and becomes a Contract only when it  is
\nenforceable by
\n303<\/span>
\nlaw. If it is not enforceable it would be void by reason  of
\nsection\t 2(g) thereof. The question, therefore,\t is  whether
\nthe contract of service or Regulation 9(b) in derogation  to
\nthe Fundamental Rights guaranteed in Part III of the Consti-
\ntution is valid in law and would be enforceable.
\nContract whether changeable with changing times.\n<\/p>\n
    15.\t The law of contract, like the legal system  itself,
\ninvolves a balance between competing sets of values. Freedom
\nof contract emphasises the need of stability, certainty\t and
\npredictability.\t But, important as is values are,  they\t are
\nnot  absolute,\tand there comes a point where they  “face  a
\nserious\t challenge” against them must be set the  values  of
\nprotecting  the\t weak, oppressed and  the  thoughtless\tfrom
\nimposition  and oppressed. Naturally, at a particular  time,
\none  set of value tends to be emphasised at the\t expense  of
\nthe other as the time changes the values get changed and the
\nold  values are under replacement and new values take  their
\ndue  place. Though certainty and predictability in  ordinary
\ncommercial contract law is emphasised and insisted upon\t the
\nneed  for progress of the society and to removing the  disa-
\nbilities  faced\t by the citizens and  their  relations\twhen
\nencounter  with\t the State or its instrumentalities  are  in
\nconflict  with the assured constitutional rights demand\t new
\nvalues\tand  begin to assert themselves,  for  no  civilised
\nsystem of law can accept the implications of absolute  sanc-
\ntity of contractual obligations and of their immutability.
\n    In\tparagraph  4 of Chitty on Contracts  (25th  Edition,
\nVolume-I)  it is stated that “freedom of contract is a\trea-
\nsonable\t social\t ideal only to the extent that\tequality  of
\nbargaining power between contracting parties can be  assumed
\nand no injury is done to the economic interest of the commu-
\nnity at large.\n<\/p>\n
    In Anson’s Law of Contract at p. 6 & 7 stated the  scope
\nof freedom of contract in the changing circumstances thus:
\n“Today\tthe  position  is seen in a  very  different  light.
\nFreedom of contract is a reasonable social ideal only to the
\nextent that equality of bargaining power between contracting
\nparties can be assumed, and no injury is done to the econom-
\nic interests of the community at large. In the more  compli-
\ncated  social  and industrial conditions of  a\tcollectivist
\nsociety it has ceased to have much idealistic attraction. It
\nis now realised that economic equality often does not exists
\nin any real sense, and that individual interests have to be
\n304<\/span>
\nmade to subserve those of the community hence there has been
\na  fundamental change both in our social outlook and in\t the
\npolicy of the legislature towards contract and the law today
\ninterferes  at numerous points with the freedom of the\tpar-
\nties  to make what contract they like. The relation  between
\nemployers and employed, for example, have been regulated  by
\nstatutes designed to ensure that the employees condition  of
\nwork are safe, that he is properly protected against  redun-
\ndancy and that he knows his terms of service. The public has
\nbeen protected against economic pressure by such measures as
\nthe  Rent Acts, the supply of goods (implied terms) at,\t the
\nconsumer  Credit  Act and other\t similar  enactments.  These
\nlegislative  provisions\t will override\tany  contrary  terms
\nwhich  the  parties may make for  themselves.  Further,\t the
\nlegislature has intervened in the Restrictive Trade Practice
\nAct 1956 and the Fair Trading Act, 1973 to promote  competi-
\ntion  in industry and to safeguard the interests of  consum-
\ners.  This  intervention is specially necessary\t today\twhen
\nmost contracts entered by ordinary people are not the result
\nof individual negotiation. It is not possible for a  private
\nperson\tto settle the terms of his agreement with a  British
\nRailways Board or with a local electricity authority.
\nThe  standard  form’ contract is the rule.  He\tmust  either
\naccept\tthe terms of this contract in toto, or\tgo  without.
\nSince, however, it is not feasible to deprive onself of such
\nnecessary services, the individual is compelled to accept on
\nthose  terms. In view of this fact, it is quite\t clear\tthat
\nfreedom of contract is now largely an illusion.\n<\/p>\n
    16.\t The  trinity of the Constitution  assure  to  every
\ncitizen Social and Economic Justice, Equality of Status\t and
\nof  opportunity with dignity of the person. The State is  to
\nstrive\tto minimise the inequality in income  and  eliminate
\ninequality  in status between individuals or groups of\tpeo-
\nple.  The State has intervened with the freedom of  contract
\nand interposed by making statutory law like Rent Acts,\tDebt
\nRelief\tActs,  Tenancy Acts, Social Welfare  and  Industrial
\nLaws  and Statutory Rules prescribing conditions of  service
\nand a host of other laws. All these Acts and Rules are\tmade
\nto  further  the  social solidarity and as  a  step  towards
\nestablishing an egalitaran socialist order. This Court, as a
\ncourt of constitutional conscience enjoined and a  jealously
\nto project and uphold new values in establishing the  egali-
\ntarian social order. As a court of constitutional  function-
\nary exercising equity juris-\n<\/p>\n
305<\/span><\/p>\n
diction,  this Court would relieve the weaker  parties\tfrom
\nunconstitutional  contractual obligations,  unjust,  unfair,
\noppressive  and unconscienable rules or conditions when\t the
\ncitizen\t is  really unable to meet on equal terms  with\t the
\nState. It is to find whether the citizen, when entered\tinto
\ncontracts  or  service, was in distress need  or  compelling
\ncircumstances  to  enter into contract on  dotted  lines  or
\nwhether the citizen was in a position of either to “take  it
\nor leave it” and if it finds to be so, this Court would\t not
\nshirk  to  avoid the contract  by  appropriate\tdeclaration.
\nTherefore, though certainty is an important value in  normal
\ncommercial contract law, it is not an absolute and immutable
\none  but is subject to change in the changing social  condi-
\ntions.\n<\/p>\n
    17. In Brojonath’s case, Madan, J., elaborately  consid-
\nered the development of law relating to unfair or unreasona-
\nble terms of the contract or clauses thereof in extenso\t and
\nit  is unnecessary for me to traverse the same grounds\tonce
\nover.  The  learned  Judge also\t considered  the  arbitrary,
\nunfair\tand  unbridled power on the  envil  of\tdistributive
\njustice\t or justness or fairness of the procedure  envisaged
\ntherein. The relevant case law in that regard was dealt with
\nin  extenso  in the light of the development of law  in\t the
\nSupreme\t Court of United States of America and the House  of
\nLords in England and in the continental countries. To  avoid
\nneedless  burden on the judgment, I do not repeat  the\tsame
\nreasoning.  I  entirely\t agree with the\t reasoning  and\t the
\nconclusions reached therein on all these aspects.
\nWhether State can impose unconstitutional Conditions.\n<\/p>\n
     18.  The problem also would be broached from the  angle
\nwhether the State can impose unconstitutional conditions  as
\npart  of the contract or statute or rule etc. In 1959-60  73
\nHarvard Law Review, in the Note under the Caption ‘Unconsti-
\ntutional  Condition’ at page 1595-96 it is  postulated\tthat
\nthe  State  is devoid of power\tto  impose  unconstitutional
\nconditions  in the contract that the power to withhold\tlar-
\ngess has been asserted by the State in four areas i.e.,\t (1)
\nregulating  the right to engage in certain  activities;\t (2)
\nAdministration of Government welfare programme; (3)  Govern-
\nment  employment; and (4) Procurement of contracts.  It\t was
\nfurther adumberated at pages 1602-1603 thus:
\n“The  sovereign’s constitutional authority to  choose  those
\nwith  whom  it will contract for goods and  services  is  in
\neffect a power to withhold the benefits to be deprived\tfrom
\neconomic dealings with the government. As government
\n306<\/span>
\nactivity  in the economic sphere increases, the\t contracting
\npower enables the government to control many hitherto unreg-
\nulated activities of contracting parties through the imposi-
\ntion  of  conditions. Thus, regarding the  government  as  a
\nprivate\t entrepreneur  threatens  to  impair  constitutional
\nrights\t…..  The Government, unlike a private\t individual,
\nis  limited in its ability to contract by the  Constitution.
\nThe  federal contracting power is based upon  the  Constitu-
\ntion’s authorisation of these acts ‘necessary and proper’ to
\nthe carrying out of the functions which it allocates to\t the
\nnational government,–Unless the objectives sought by  terms
\nand conditions in government contracts requiring the surren-
\nder  of rights are constitutionally authorised,\t the  condi-
\ntions must fall as ultra vires exercise of power.”
\nAgain at page 1603, it is further emphasised thus:
\n“When  conditions limit the economic benefits to be  derived
\nfrom  dealings with the government to those who\t forego\t the
\nexercise  of constitutional rights, the exclusion  of  those
\nretaining  their rights from participation in the  enjoyment
\nof  these  benefits may be a violative of  the\tprohibition,
\nimplicit  in the due process clause of fifth  amendment\t and
\nexplicit  in the equal protection clause of  the  fourteenth
\namendment against unreasonable discrimination in the Govern-
\nmental bestow of advantages. Finally, disabling those  exer-
\ncising\tcertain rights from participating in the  advantages
\nto be derived from contractual relations with the government
\nmay  be a form of penalty lacking in due process.  To  avoid
\ninvalidation for any of the above reasons, it must be  shown
\nthat  the  conditions imposed are necessary  to\t secure\t the
\nlegitimate  objectives of the contract ensure its  effective
\nuse,  or protect society from the potential harm  which\t may
\nresult from the contractual relationship between the govern-
\nment and the individual.\n<\/p>\n
    19.\t Professor  Guido Calabresi of Yale  University\t Law
\nSchool in his “Retroactivity, Paramount power and Contractu-
\nal  Changes”  ( 196 1-62) 71 Yale Law Journal P.  119  1  at
\n1196) stated that the Government can make contracts that are
\nnecessary  and proper for carrying out any of  the  specific
\nclauses\t of the Constitution or power to spend\tfor  general
\nwelfare.  The Federal Government has no power,\tinherent  or
\nsovereign,  other  than\t those\tspecifically  or  explicitly
\ngranted to it by
\n307<\/span>
\nthe Constitution. At page 1197, it is further stated thus:
\n“The Government acts according to due process standards\t for
\nthe due process clause is quite up to that task without\t the
\nrule. Alterations of Government contracts are not  desirable
\nin  a free country even when they do not constitute a  ‘tak-
\ning’  of  property or impinge on  questions  of\t fundamental
\nfairness  of the type comprehended in due process. The\tgov-
\nernment\t may make changes, but only if war or  commerce\t re-
\nquire them and not on the broader and more ephemeral grounds
\nthat the general welfare would be served by the change.\t Any
\nother  rule  would allow the Government to which  almost  at
\nwill.”\n<\/p>\n
    20.\t These principles were accepted and followed by\t the
\nAndhra\tPradesh High Court in V. Raghunadha Rao v. State  of
\nAndhra Pradesh, [1988] 2 A.L.T. 461 dealing with A.P. Stand-
\nard  specification  Clauses  11, 29, 59, 62(b)\tand  73\t and
\ndeclared  some\tclauses to be ultra vires  of  Articles\t 14,
\n19(1)(g)  and 21 of the Constitution and Sections 23 and  27
\nof the Contract Act.\n<\/p>\n
    21. In Brojonath’s case (supra) after elaborate  consid-
\neration\t of the doctrine of “reasonableness or fairness”  of
\nthe  terms  and\t conditions of the  contract  vis-a-vis\t the
\nrelative  bargaining power of the contracting  parties\tthis
\nCourt  laid  down that the principles  deductable  from\t the
\ndiscussion  made  therein  is in consonance  with  right  or
\nreason\tintended to secure socio-economic justice  and\tcon-
\nforms  to mandate of the equality clause in Article 14.\t The
\nprinciple  laid was that courts will not enforce  and  will,
\nwhen called upon to do so, strike down an unfair and  unrea-
\nsonable\t contact or an unfair and unreasonable clause  in  a
\ncontract, entered into between parties who are not equal  in
\nbargaining  power   …..  It will apply  to  situations  in
\nwhich  the  weaker party is in a position in  which  he\t can
\nobtain\tgoods or services or means of livelihood  only\tupon
\nthe terms imposed by the stronger party or go without  them.
\nIt  will also apply where a man has no choice, or rather  no
\nmeaningful  choice, but to give his assent to a contract  or
\nto sign on the dotted line in a prescribed or standard\tform
\nor to accept a set of rules as part of the contract, however
\nunfair,\t unreasonable  and unconscienable a clause  in\tthat
\ncontract  or form or rules may be. This principle,  however,
\nwill not apply where the bargaining power of the contracting
\nparties\t is equal or almost equal or where both parties\t are
\nbusinessmen and the contract is a commercial transaction.\n<\/p>\n
308<\/span><\/p>\n
    22. In today’s complex world of giant corporations\twith
\ntheir vast infra-structural organisations and with the State
\nthrough its instrumentalities and agencies has been entering
\ninto almost every branch of industry and commerce and  field
\nof  service, there can be myriad situations which result  in
\nunfair\tand  unreasonable bargains between  parties  possess
\nwholly disproportionate and unequal bargaining power.  These
\ncases  can neither be enumerated nor fully illustrated.\t The
\ncourt  must  judge each case on its own\t facts\tand  circum-
\nstances.\n<\/p>\n
Public policy whether changeable.\n<\/p>\n
    23.\t This  Court also angulated the\t question  from\t the
\nperspective  of public policy or contract being\t opposed  to
\npublic\tpolicy.\t The phrases “public  policy”,\t“opposed  to
\npublic policy”, or “contrary to public policy” are incapable
\nof precise definition. It is valued to meet the public\tgood
\nor the public interest. What is public good or in the public
\ninterest or what would be injurious or harmful to the public
\ngood or the public interest vary from time to time with\t the
\nchange of the circumstances. New concepts take place of\t old
\none.  The transactions which were considered at one time  as
\nagainst\t public\t policy\t were held by the courts  to  be  in
\npublic interest and were found to be enforceable. Therefore,
\nthis Court held in Brojonath’s case that “there has been  no
\nwell-recognised\t head of public policy, the courts have\t not
\nshirked\t from extending it to new transactions\tand  changed
\ncircumstances  and  have  at times not\teven  flinched\tfrom
\ninventing a new head of public.”\n<\/p>\n
    Lord  Wright in his legal Essays and Addresses Vol.\t III
\np. 76 and 78 stated that public policy like any other branch
\nof  the common law ought to be and I think is,\tgoverned  by
\nthe  judicial  use of precedents …..\tIf it is  said\tthat
\nrules of public policy have to be moulded to suit new condi-
\ntions  of  a changing world, that is true, but the  same  is
\ntrue  with the principles of the cannon law generally;\tLord
\nLindley\t held  in Janson v. Driefontein Mines  Ltd.,  [1902]
\nA.C.p. 484 and 507 that “a contract or other branch which is
\nagainst\t public policy i.e. against the general interest  of
\nthe country is illegal.”\n<\/p>\n
    24.\t In  Anson’s Law of Contract, 24th Edition  by\tA.G.
\nGuest  at p.. 335 stated the scope of variability of  public
\npolicy\tattune to the needs of the day and the march of\t law
\nthus:\n<\/p>\n
“At the present time, however, there is an increasing recog-
\nnition of the positive function of the Courts in matters
\n309<\/span>
\nof public policy: ‘The law relating to public policy  cannot
\nremain\timmutable. It must change with the passage of  time.
\nThe  wind of change blows upon it’. Some aspects  of  public
\npolicy\tare more susceptible to change than  others,  during
\nthe policy of the law has, on certain subjects, been  worked
\ninto  a\t set  of tolerably definite  rules.  The  principles
\napplicable to agreements in restraint of trade, for example,
\nhave  on a number of occasions been modified or extended  to
\naccord with prevailing economic conditions, and this process
\nstill continues.\n<\/p>\n
    In\tlaw of Contract by G.H. Treitei, 7th Edition  at  p,
\n366  on the topic ‘scope of the public policy’ it is  stated
\nthus:\n<\/p>\n
“Public\t policy is a variable notion, depending on  changing
\nmanners,  morals  and economic conditions. In  theory,\tthis
\nflexibility of the doctrine of public policy could provide a
\njudge with an excuse for invalidating any contract which  he
\nviolently  disliked. On the other hand, the law\t does  adapt
\nitself\tto change in economic and social conditions, as\t can
\nbe seen particularly from the development of the rules as to
\ncontracts  in  restraint  of public policy  has\t often\tbeen
\nrecognised judicially. Thus Lord Haldane has said; “What the
\nlaw  recognises\t as contrary to public policy turns  out  to
\nvary greatly from time to time.” And Lord Denning has put  a
\nsimilar\t point of view. “with a good man in the saddle,\t the
\nunruly horse can be kept in control. It can jump over obsta-
\ncles.”\tThe  present  attitude of the  Courts  represents  a
\ncompromise between the flexibility inherent in the notion of
\npublic\tpolicy\tand  the need for  certainty  in  commercial
\naffairs.”\n<\/p>\n
    25.\t From this perspective, it must be held that in\t the
\nabsence\t of  specific head of public policy which  covers  a
\ncase,  then  the court must in consonance with\tpublic\tcon-
\nscience and in keeping with public good and public  interest
\ninvent new public policy and declare such practice or  rules
\nthat  are  derogatory to the constitution to be\t opposed  to
\npublic\tpolicy. The rules which stem from the public  policy
\nmust  of  necessity be laid to further the progress  of\t the
\nsociety\t in particular when social change is to bring  about
\nan egalitarian social order through rule of law. In deciding
\na  case\t which may not be covered by authority\tcourts\thave
\nbefore them the beacon light of the trinity of the Constitu-
\ntion and the play of legal light and shade must lead on\t the
\npath of justice social,
\n310<\/span>
\neconomical  and political. Lacking precedent, the court\t can
\nalways be guided by that light and the guidance thus shed by
\nthe trinity of our Constitution.\n<\/p>\n
Public policy can be drawn from the Constitution.\n<\/p>\n
    26. Sutherland, in his Statutes and Statutory  Construc-
\ntion  Third Edition Vol. 3 paragraph 5904 at page  13  1-132
\nhas stated that the most reliable source of public policy is
\nto  be found in the federal and state  constitutions.  Since
\nconstitutions are the superior law of the land, and  because
\none of their outstanding features is flexibility and capaci-
\nty  to meet changing conditions, constitutional policy\tpro-
\nvides  a valuable aid in determining the  legitimate  bound-
\naries  of statutory meaning. Thus public policy\t having\t its
\ninception in constitutions may accomplish either a restrict-
\ned or extended interpretation of the literal expression
\n    a statute. A statute is always presumed to be  constitu-
\ntional and where necessary a constitutional meaning will  be
\ninferred  to  preserve validity. Likewise, where  a  statute
\ntends  to  extend or preserve  a  constitutional  principle,
\nreference  to analogous constitutional provisions may be  of
\ngreat value in shaping the statute to accord with the statu-
\ntory aim or objective.\n<\/p>\n
Article\t 14 sheds the light to public policy to\t curb  arbi-
\ntrariness.\n<\/p>\n
    26A. In Basheshar Nath v. The Commissioner of Income-Tax
\n&  Anr.,<\/a>  [1959] Suppl. 1 SCR 528 S.R. Das, CJ.,  held\tthat
\nArticle\t 14 is founded on a sound public  policy  recognised
\nand valued in all States and it admonishes the State when it
\ndisregards the obligations imposed upon the State.
\n    26B.  In  E.P. Royappa v. State of Tamil  Nadu  &  Ant.,<\/a>
\n[1974]\t2  SCR 348 Bhagwati. J. (as he then was)  held\tthat
\nArticle 14 is the genus while Article 16 is a specie.  Arti-
\ncle  16\t gives\teffect to the doctrine of  equality  in\t all
\nmatters\t relating to public employment. The basic  principle
\nwhich. therefore, informs both Articles 14 and 16 is equali-
\nty  and\t inhibition against discrimination. “Equality  is  a
\ndynamic\t concept  with many aspects and\t dimensions  and  it
\ncannot be “cribbed, cabined and confined” within traditional
\nand  doctrinaire limits. From a positivistic point of  view.
\nequality  is antithetic to arbitrariness. In fact,  equality
\nand arbitrariness are sworn enemies; one belongs to the rule
\nof  law in a republic while the other, to the whim  and\t ca-
\nprice  of an absolute monarch. Where an act is arbitrary  it
\nis  implicit  in  it that it is unequal\t both  according  to
\npolitical logic and constitutional law and is therefore
\n311<\/span>
\nviolative of Article 14, and if it affects any matter relat-
\ning  to public employment, it is also violative\t of  Article\n<\/p>\n
16.  Articles  14 and 16 strike at  arbitrariness  in  State
\naction\tand  ensure fairness and equality of  treatment.  In
\nMenaka Gandhi’s case it was further held that the  principle
\nof reasonableness, which legally as well as philosophically,
\nis  an\tessential element of equality  or  non-arbitrariness
\npervades  Article 14 like a brooding omnipresence. In  Rama-
\nna’s  case it was held that it is merely a judicial  formula
\nfor determining whether the legislative or. executive action
\nin  question is arbitrary and therefore constituting  denial
\nof  equality.  If the classification is not  reasonable\t and
\ndoes  not satisfy the two conditions namely, rational  rela-
\ntion and nexus the impugned legislative or executive  action
\nwould  plainly be arbitrary and the guarantees\tof  equality
\nunder  Article\t14 would be breached.  Wherever,  therefore,
\nthere  is  arbitrariness in State action whether  it  be  of
\nlegislature  or of the executive or of an “authority”  under
\nArticle 12, Article 14, “immediately springs into action and
\nstrikes\t down  such State action.” In fact, the\t concept  of
\nreasonableness\tand  non-arbitrariness pervades\t the  entire
\nconstitutional\tscheme\tand is a golden\t thread\t which\truns
\nthrough the whole of the fabric of the constitution.\n<\/p>\n
    27. In Volga Tellies’Case it was held that the Constitu-
\ntion is not only paramount law of the land but also it is  a
\nsource\tof sustenance of all laws. Its provisions  are\tcon-
\nceived\tin public interest and are intended to serve  public
\npurpose. Therefore, when the provisions of an Act or Regula-
\ntions or Rules are assailed as arbitrary, unjust, unreasona-
\nble, unconstitutional, public law element makes it incumbent
\nto consider the validity there’of on the envil of inter play
\nof  Arts. 14′, 16(1), 19(1)(g) and 21 and of the  inevitable
\neffect of the impugned provision on the rights of a  citizen
\nand to find whether they are constitutionally valid.
\nInterplay of Arts. 14, 16(1), 19(1)(g) & 21 as guarantors of
\npublic employment as a source of right to livelihood.\n<\/p>\n
    28. It is well settled constitutional law that different
\nArticles in the Chapter on Fundamental Rights and the Direc-
\ntive Principles in Part IV of the Constitution must be\tread
\nas an integral and incorporeal whole with possible  overlap-
\nping  with the subject-matter of what is to be protected  by
\nits various provisions particularly the Fundamental Rights.
\n    By\tthe  Full Court in R.C. Cooper v.  Union  of  India,<\/a>
\n[1970]\t3 SCR 530 it was held that the law must\t not  impair
\nthe guarantee of any
\n312<\/span>
\nof  the fundamental rights in Part-III. The law\t authorising
\nto  impose reasonable restrictions under Article 19(1)\tmust
\nbe intended to advance the larger public interest. Under the
\nConstitution, protection against impairment of the guarantee
\nof the fundamental rights is determined by the nature of the
\nright,\tinterest  of the aggrieved party and the  degree  of
\nharm  resulting\t from the state action.\t Impairment  of\t the
\nright  of the individual and not the object of the State  in
\ntaking the impugned action is the measure of protection.  To
\nconcentrate merely on the power of the State and the  object
\nof the State action in exercising that power is,  therefore,
\nto  ignore the true intent of the constitution.\t The  nature
\nand  content of the protection of the fundamental rights  is
\nmeasured  not by the operation of the State action upon\t the
\nrights of the individual but by its objects. The validity of
\nthe State action must be adjudged in the light of its opera-
\ntion  upon  the rights of the individuals or groups  of\t the
\nindividual in all their dimensions. It is not the object  of
\nthe  authority\tmaking\tthe law imparing the  right  of\t the
\ncitizen\t nor  the form of action taken that  determines\t the
\nprotection he can claim; it is the effect of the law and  of
\nthe action upon the right which attract the jurisdiction  of
\nthe court to grant relief. In Minerva Mills Ltd. v. Union of
\nIndia,<\/a> [1981] 1 SCR 206 the fundamental rights and directive
\nprinciples are held to be the conscience of the Constitution
\nand disregard of either would upset the equibalance built up
\ntherein. In Menaka Gandhi’s case, it was held that different
\narticles in the chapter of Fundamental Rights of the Consti-
\ntution\tmust  be read as an. integral whole,  with  possible
\noverlapping  of the subject matter of what is sought  to  be
\nprotected by its various provisions particularly by articles
\nrelating to fundamental rights contained in Part III of\t the
\nConstitution  do not represent entirely separate streams  of
\nrights\twhich  do not mingle at many points.  They  are\t all
\nparts  of  an integrated scheme in the\tConstitution.  Their
\nwaters\tmust mix to constitute that grand flow of  unimpeded
\nand  impartial justice; social, economic and political,\t and
\nof equality of status and opportunity which imply absence of
\nunreasonable or unfair discrimination between individuals or
\ngroups or classes. The fundamental rights protected by\tPart
\nIII of the constitution, out of which Articles 14, 19 and 21
\nare  the  most frequently invoked to test  the\tvalidity  of
\nexecutive as well as legislative actions when these  actions
\nare  subjected to judicial scrutiny. Fundamental Rights\t are
\nnecessary  means  to develop one’s own\tpersonality  and  to
\ncarve  out  one’s  own life in the manner  one\tlikes  best,
\nsubject to reasonable restrictions imposed in the  paramount
\ninterest  of the Society and to a just, fair and  reasonable
\nprocedure. The effect of restriction or deprivation and\t not
\nof  the form adopted to deprive the right is the  conclusive
\ntest. It is already seen that the right to a public employ-\n<\/p>\n
313<\/span><\/p>\n
ment is a constitutional right under Art. 16(1). All matters
\nrelating  to  employment include the right  to\tcontinue  in
\nservice\t till  the employee reaches  superannuation  or\t his
\nservice is duly terminated in accordance with just, fair and
\nreasonable procedure prescribed under the provisions of\t the
\nConstitution or the Rules made under proviso to Article\t 309
\nof the Constitution or the statutory provision or the Rules,
\nregulations  or instructions having statutory  flavour\tmade
\nthereunder, But the relevant provisions must be\t conformable
\nto the rights guaranteed in Parts III & IV of the  Constitu-
\ntion,  Article\t21 guarantees the_ right to live  which\t in-
\ncludes right to livelihood, to a many the assured tenure  of
\nservice\t is the source, the deprivation thereof must  be  in
\naccordance with the procedure prescribed by law\t conformable
\nto  the mandates of Articles 14 and 21 as be fair, just\t and
\nreasonable  but\t not fancyful oppressive or at\tvagary.\t The
\nneed  for the fairness, justness or reason ableness  of\t the
\nprocedure was elaborately considered in Menaka Gandhi’s case
\n(supra) and it hardly needs reiteration.\n<\/p>\n
Principles of natural justice in Part of Article 14.\n<\/p>\n
    29.\t The Menaka Gandhi’s case is also an  authority\t for
\nthe proposition that the principles of natural justice is an
\nintegral part of the guarantee of equality assured by  Arti-
\ncle  14\t of the Constitution. In Union of India\t &  Anr.  v.
\nTulsiram Patel & Ors.,<\/a> [1985] Suppl. 2 SCR 13 1 at 233, this
\nCourt held that the principles of natural justice have\tthus
\ncome  to  be  recognised as being a part  of  the  guarantee
\ncontained  in  Article\t14 because of the  new\tand  dynamic
\ninterpretation given by this Court to the concept of equali-
\nty which is the subject-matter of that Article. Shortly put,
\nthe syllogism runs thus:\n<\/p>\n
“Violation  of\ta rule of natural justice results  in  arbi-
\ntrariness  which is the same as discrimination;\t where\tdis-
\ncrimination  is\t the  result of the State action,  it  is  a
\nviolation of Art. 14, therefore, a violation of a  principle
\nof natural justice by a State action is a violation of\tArt-\n<\/p>\n
14.  Article 14, however; is not the sole repository of\t the
\nprinciples of natural justice. What it does is to  guarantee
\nthat  any law or State action violating them will be  struck
\ndown. The principles of natural justice, however, apply\t not
\nonly to the legislation and State action but also where\t any
\ntribunal,  authority or body of men, not coming\t within\t the
\ndefinition  of ‘State’ in Art. 12, is charged with the\tduty
\nof  deciding  a matter. In such a case,\t the  principles  of
\nnatural\t justice require that it must decide such  a  matter
\nfairly and impartially.”\n<\/p>\n
314<\/span><\/p>\n
   In Moti Ram Deka’s case this Court already held that “the
\nrule making authority contemplated by Article 309 cannot  be
\nvalidly\t exercised  so as to curtail or\t affect\t the  rights
\nguaranteed  to\tpublic servants under Art.  311(2).  Article
\n311(2)\tis intended to afford a sense of scrutiny to  public
\nservants who are substantively appointed to a permanent post
\nand one of the principle benefits which they are entitled to
\nexpect\tis  the benefit of pension  after  rendering  public
\nservice for the period prescribed by the Rules. It would, we
\nthink, not be legitimate to contend that the right to earn a
\npension\t to  which a servant substantively  appointed  to  a
\npermanent post is entitled can be curtailed by Rules  framed
\nunder Art. 309 so as to make the said right either  ineffec-
\ntive  or illusory. Once the scope of Art. 311(1) and (2)  is
\nduly  determined, it must be held that no rule framed  under
\nArt. 309 can trespass on the rights guaranteed by Art.\t311.
\nThis  position is of basic importance and must be  borne  in
\nmind in dealing with the controversy in question.\n<\/p>\n
    30. In A.K. Kraipak & Ors etc. v. Union of India & Ors.,
\n[1970]\t1  SCR\t457 this Court held that  Rules\t of  natural
\njustice\t aims at securing justice or to\t prevent  injustice.
\nThey operate only in the areas not covered by any law valid-
\nly made. In Union of India v. Col. J.N. Sinha and Anr.,<\/a> [197
\n1] 1 SCR 791 it was held that principles of natural  justice
\ndo  not supplant the law but supplement it. If\ta  statutory
\nprovision  either specifically or by  necessary\t implication
\nexcludes  the  application of any rules of  natural  justice
\nthen the court cannot ignore the mandate of the\t legislature
\nor  the\t statutory  authority and read\tinto  the  concerned
\nprovision of the principles of natural justice. In that case
\nthis Court held that principles of natural justice cannot be
\nread into Fundamental Rule and no opportunity need be  given
\nbefore compulsorily retiring an employee as that implication
\ndoes not arise by reason of express statutory language.\n<\/p>\n
    31.\t The  principle of natural justice  embodied  as  an
\nintegral part of equality clause. Article 14 is the  general
\nprinciple while Art. 311(2) is a special provision  applica-
\nble  to all civil services under the State.  Article  311(2)
\nembodies  the principles of natural justice but\t proviso  to
\nClause (2) of Art. 311 excludes the operation of  principles
\nof natural justice engrafted in Art. 311(2) as an  exception
\nin  the given circumstances enumerated in three\t clauses  of
\nthe  proviso to Art. 311(2) of the Constitution. Article  14
\nread with Arts. 16(1) and 311 are to be harmoniously  inter-
\npreted that the proviso to Art. 311(2) excludes the applica-
\ntion  of the principles of natural justice as an  exception;
\nand  the  applicability of Art. 311(2) must,  therefore,  be
\ncircumscribed  to  the civil services and  to  be  construed
\naccordingly. In respect of all other
\n315<\/span>
\nemployees covered by Art. 12 of the Constitution the dynamic
\nrole of Art. 14 and other relevant Articles like 21 must  be
\nallowed to have full play without any inhibition, unless the
\nstatutory  rules themselves, consistent with the mandate  of
\nArts. 14, 16, 19 & 21 provide, expressly such an exception.
\n    Article 19(1)(g) empowers every citizen right to  avoca-
\ntion or profession etc., which includes right to be  contin-
\nued  in\t employment  under the State unless  the  tenure  is
\nvalidly\t terminated consistent with the scheme enshrined  in
\nthe  fundamental rights of the Constitution.  Therefore,  if
\nany  procedure is provided for deprivation of the  right  to
\nemployment or right to the continued employment till the age
\nof  superannuation  as is a source to right  to\t livelihood,
\nsuch  a\t procedure must be just, fair and  reasonable.\tThis
\nCourt in Fertilizer Corporation Kamgar Union (Regd.), Sindri
\n&  Ors. v. Union of India & Ors.,<\/a> [1981] 2 SCR 52  at  60-61
\nheld  that Art. 19(1)(g) confers a broad and  general  right
\nwhich is available to all persons to do works of any partic-
\nular kind and of their choice. Therefore, whenever there  is
\narbitrariness in state action–whether it be of the legisla-
\nture  or of the Executive or of an authority under Art.\t 12,
\nArts. 14 and 21 spring into action and strikes down such  an
\naction.\t The concept of reasonableness and  nonarbitrariness
\npervades the entire constitutional spectrum and is a  golden
\nthread which runs through the whole fabric of the  Constitu-
\ntion.  Therefore, the provision of the statute, the  regula-
\ntion or the rule which empowers an employer to terminate the
\nservices  of an employee whose service is of  an  indefinite
\nperiod till he attains the age of superannuation, by serving
\na  notice of pay in lieu thereof must be conformable to\t the
\nmandates  of Arts. 14, 19(1)(g) and 21 of the  Constitution.
\nOtherwise  per se it would be void. In Motiram Deka’s  case,
\nGajendragadkhar, J-, (as he then was) after invalidating the
\nrules  149(3)  and  148(3) under Art.  311(2)  which  impari
\nmateria\t Rule 9(b) of the Regulation also  considered  their
\nvalidity in the light of Art. 14 and held thus:
\n“Therefore,  we\t are  satisfied that the  challenge  to\t the
\nvalidity  of  the  impugned Rules on the  ground  that\tthey
\ncontravene Art. 14 must also succeed.”\n<\/p>\n
This  was  on the test of reasonable classification  as\t the
\nprinciple then was applied. Subba Rao, J., (as he then\twas)
\nin  a separate but concurrent judgment, apart from.  invali-
\ndating the rule under Article 311(2) also held that the Rule
\ninfringed  Article 14 as well, though there is no  elaborate
\ndiscussion in that regard. But, Das Gupta, J., considered
\n316<\/span>
\nelaborately on this aspect and held:\n<\/p>\n
“Applying  the principle laid down in the above case to\t the
\npresent\t rule,\tI find on the scrutiny of the Rule  that  it
\ndoes  not lay down any principle or policy for\tguiding\t the
\nexercise  of discretion by the authority who will  terminate
\nthe  service in the matter of selection\t or  classification.
\nArbitrary and uncontrolled power is left in the authority to
\nselect\tat its will any person against whom action  will  be
\ntaken.\tThe  Rule, thus enables the authority  concerned  to
\ndiscriminate between two railway servants to both of whom R.
\n148(3) equally applied by taking action in one case and\t not
\ntaking it in the other. In the exercise of the discretion by
\nthe  authority the rule has therefore to be struck  down  as
\ncontravening  the requirements of Art. 14 of  the  Constitu-
\ntion.”\n<\/p>\n
    32.\t Even  in Tulsiram Patel’s case (supra)\t this  Court
\ndeclared that it must satisfy the test of justness, fairness
\nand  reasonableness  of the procedure  prescribed.  But\t the
\nproviso\t to Art. 311(2) was upheld for the reason  that\t the
\nConstitution itself made proviso–an exception to the  prin-
\nciple of audi alteram partem engrafted in Art. 311(2) of the
\nConstitution. As a fact, it expressed thus:
\n“As  the making of such laws and the framing of\t such  rules
\nare  subject to the provisions of the Constitution,  if\t any
\nsuch  act  or rules violates any of the\t provisions  of\t the
\nConstitution,  it would be void. Thus, as held in  Moti\t Ram
\nDeka’s\tcase AIR 1964 SC 600 if any such act or\t rule  tres-
\npasses\ton the rights guaranteed to government\tservants  by
\nArt.  311, it would be void. Similarly, such acts and  rules
\ncannot abridge or restrict the pleasure of the President  or
\nthe  Governor  of  a State exercisable under  Art.  3  10(1)
\nfurther\t than what the Constitution has expressly  done.  In
\nthe same way, such Act or rule would be void if it  violates
\nany fundamental right guaranteed by part III of the  Consti-
\ntution.”\n<\/p>\n
    Gurdev Singh’s case declares the rules that empowered to
\norder compulsory retirement of the Government employee after
\nputting\t ten years of service as ultra vires. In S.S.  Muley
\nv.J.R.D. Tata, [1979] 2 SLR 438 (Bombay) my learned  brother
\nSawant,\t J. (as he then was) held that Regulation  48  which
\nempowered  the employer uncanalised, unrestricted and  arbi-
\ntrary  power  to terminate the service of an  employee\twith
\nnotice or pay in lieu thereof without any opportunity of
\n317<\/span>
\nhearing as violative of principles of natural justice  under
\nArt. 14 of the Constitution.\n<\/p>\n
    In Superintendent of Post Office v.K. Vasayya, [1984]  3
\nAndhra\tPradesh\t Law Journal 9 the  respondent\tVasayya\t was
\ndenied of the appointment as a Clerk on the ground that\t the
\nConfidential  Reports  submitted  by  the  Police  disclosed
\nadverse comments on the conduct of the respondent. When\t the
\nappointment was denied on that basis it was held that though
\nthe  selection\tto  a public office is a  privilege  and  no
\nvested right has been accrued till the candidate is appoint-
\ned,  in\t the context of fair play in action  subserving\t the
\nmandate of Art. 14 held at p. 45 thus:\n<\/p>\n
“Often\ttimes, convenience and justice are not\ton  speaking
\nterms.\tIt is the actual administration of law and not\tonly
\nthe  manner in which it is done that reflects the action  of
\nthe State in assuring the equal protection to a citizen.  In
\nadopting the procedure, as held by Frankfurther, J. in Joint
\nAnti  Facist  Refugee Commission v. Mc. Grath, 34 1  US\t 123
\nthat  a conclusion satisfies one’s private  conscience\tdoes
\nnot attest its reliability. The validity and moral authority
\nof a conclusion largely depends on the mode by which it\t was
\nreached.  Secrecy  is not congenial to\ttruth.\tSeeking\t and
\nself-righteousness gives too slander an assurance of  right-
\nness. No better instrument has been devised for arriving  at
\nthe  truth  than to give a person in jeopardy of  a  serious
\nloss, a notice of the case against him and an opportunity to
\nmeet it, nor has a better way been found for generating\t the
\nfeeling\t so important to a popular Government  that  justice
\nhas been done.”\n<\/p>\n
    Bradley,  J.  in United States v. Samuel  D.  singleton,
\n[1981] 109 US 3 has held that:\n<\/p>\n
“No  State shall make or enforce any law which abrogate\t the
\nprivileges or immunities of citizens of the United States.”
\nIn Ramana’s case (supra), it has been held that:\n<\/p>\n
\t  is indeed unthinkable that in a democracy governed
\nby the rule of law, the executive Govt. or any of its  offi-
\ncers  should possess arbitrary power over the  interests  of
\nthe individual\t…..\n<\/p>\n
318<\/span><\/p>\n
The  procedure\tadopted should match with what\tjustice\t de-
\nmands. History shows that it is always subtle and  insidious
\nencroachments  made ostensibly for a good cause that  imper-
\nceptibly but surely erode the foundations of liberty.”\n<\/p>\n
    Doughlas,  J. in Joint Anti Facist Refugee\tCommission’s
\ncase (supra) held that:\n<\/p>\n
“This  is a Government of laws not of men. The powers  being
\nused  are the powers of the Government over  the  reputation
\nand  fortunes of citizens. In situations far less severe  or
\nimportant  than\t those\ta party is told the  nature  of\t the
\ncharge against him.”\n<\/p>\n
    Harry  W. Jones in his “Rule of law and Welfare  State”,
\n1958 Columbia Law Review, 143 at 146 stated that:
\n“What  is needed then is to make the welfare state itself  a
\nsource\tof  new\t “rights” and to surround  the\t“rights”  in
\npublic benefaction with legal safeguards both procedural and
\nsubstantive  comparable to those enjoyed by the\t traditional
\nright of property in our law.”\n<\/p>\n
Accordingly  it was held that prior opportunity\t of  hearing
\nbefore\tdenying appointment is a mandate of Art. 14  of\t the
\nConstitution.\n<\/p>\n
    In West Bengal Electricity Board & Ors. v. D.B. Ghosh  &
\nOrs.,  [1985]  2 SCR 1014 in similar circumstances,  it\t was
\nheld  that  the regulation as “Herry VIII  Clause  as  ultra
\nvires of Art. 14 of the Constitution. The same principle was
\nreiterated in Brojonath’s case.\n<\/p>\n
    In\tWorkman of Hindustan Steel Ltd. & Anr. v.  Hindustan
\nSteel Ltd. & Ors.,<\/a> [1985] 2 SCR 428 the standing order\tthat
\nempowers  the  manager to dispense with the enquiry  and  to
\ndismiss an employee without any obligation to record reasons
\nwas  held  to  be drastic power but directed  to  amend\t the
\nstanding  orders consistent with proviso to Art.  311(2)  of
\nthe  Constitution.  This Court in O.P.\tBhandari  v.  Indian
\nTourism\t Development  Corpn. Ltd. & Ors.,<\/a> [1986] 4  SCC\t 337
\nstruck\tdown the similar rule on the same doctrine of  ‘hire
\nand  fire’ and that it is impermissible under the  constitu-
\ntion  of  the scheme to sustain the doctrine  of  ‘hire\t and
\nfire’.\tIn Chandrabhan’s case, Rule 15(1)(ii)(b)  of  Bombay
\nService Rule was held to be void. In A.P.S.R.T. Corpn. v.\n<\/p>\n
319<\/span><\/p>\n
Labour\tCourt,\tAIR (1980) A.P. 132 a Full Bench  of  Andhra
\nPradesh\t High Court held that the legislature is not  compe-
\ntent to make law abridging the right to work.
\n    In R.M.D. Chamarbaugwalla v. State of Punjab, [1957] SCR
\n930 it was held that any Act violating fundamental rights is
\nvoid. In Kanhialal v. District Judge & Ors.,<\/a> [1983] 3 SCC 32
\nthis Court held that termination of the service of a  tempo-
\nrary  employee\twithout affording opportunity  is  penal  in
\ncharacter  and\tviolates Art. 311(2) and was void.  In\tM.K.
\nAgarwal\t v, Gurgaon Gramin Bank & Ors., [1987]\tSuppl.\tSCC.
\n643 this Court struck down regulation 10(2)(a) of the  Gurg-
\naon Gramin Bank (Staff) Services Rules, 1980. In this  light
\nit  is\tnot open to the State to contend  that\t“look  here;
\nthough Constitution enjoins and admonishes us saying that it
\nis no longer open to the State to make law or rule violating
\nthe rights created under Arts. 14 and 21, the citizen,\twith
\na  view to secure public employment from us  had  contracted
\nout  of\t the constitutional rights and agreed  to  abide  by
\nrules  including the termination of his\/her services at\t any
\ntime  at  our will without notice or  opportunity  even\t for
\nmisconduct,  negligence,  inefficiency, corruption  or\trank
\nnepotism,  so  we are free to impose the  said\tpunishment.”
\nEven in the case of minority institutions, when the  employ-
\nees  are dismissed on the principle of hire and\t fire,\tthis
\nCourt  held  it\t to be impermissible vide  All\tSaints\tHigh
\nSchool v. Government of A.P., [1980] 2 SCR 924 & 938 e to f;
\nFrank Anthoney Public School v. Union of India,<\/a> [1987] 1 SCR
\n238 & 269 b to e; Christian Medical College Hospital Employ-
\nees’  Union  & Anr. v. Christian  Medical  College,  Veilore
\nAssociation & Ors., [1988] 1 SCR 546 & 562.\n<\/p>\n
    In\tMoti  Ram  Deka’s case this Court  held\t that  rules
\n148(3)\tand 149(3) trespassed upon the rights guaranteed  to
\ngovernment servants by Art. 311(2) and would be void.
\n    In\tKameshwar Prasad v. State of Bihar, [1962] Suppl.  3
\nSCR  369. Rule 4A of the Bihar Government Servants’  Conduct
\nRules,\t1956, in so far as it prohibited any form of  demon-
\nstration was struck down by this Court as being violative of
\nsub-clauses  (a) and (b) of clause (1) of Art. 19.  In\tO.K.
\nGhosh  v.  EZX Joseph,<\/a> [1963] Suppl. 1 SCR  789\t this  Court
\n‘struck down Rule 4A of the Central Civil Services  (Conduct
\nRules), 1955, on the ground that it violated sub-clause\t (c)
\nof  clause (1) of Art. 19 of the Constitution and that\tpor-
\ntion of Rule 4A which prohibited participation in any demon-
\nstration  as being violative of sub-clauses (a) and  (b)  of
\nclause\t(1) of Article 19. It must, therefore, be hold\tthat
\nany act or provision therein, Rules or Regulations or
\n320<\/span>
\ninstructions  having statutory force  violating\t fundamental
\nrights under Articles 14, 16(1), 19(1)(g) and 21 are void.\n<\/p>\n
    33.\t Thus it could be hold that Art. 14 read with  16(1)
\naccords right to an equality or an equal treatment  consist-
\nent with the principles of natural justice. Any law made  or
\naction taken by the employer, corporate statutory or instru-
\nmentality  under  Article  12 must act\tfairly,\t justly\t and
\nreasonably. Right to fair treatment is an essential  inbuilt
\nof  natural justice. Exercise of unbridled  and\t uncanalised
\ndiscretionary power impinges upon the right of the  citizen;
\nvesting\t of discretion is no wrong provided it is  exercised
\npurposively  judiciously  and without prejudice.  Wider\t the
\ndiscretion,  the  greater  the chances\tof  abuse.  Absolute
\ndiscretion  is destructive of freedom. than of\tman’s  other
\ninventions.  Absolute discretion marks the beginning of\t the
\nend  of\t the liberty. The conferment of\t absolute  power  to
\ndismiss\t a permanent employee is antithesis to\tjustness  or
\nfair treatment. The exercise of discretionary power wide  of
\nmark  would bread arbitrary, unreasonable or unfair  actions
\nand  would  not be consistent with reason and  justice.\t The
\nprovisions  of a statute, regulations or rules that  empower
\nan employer or the ‘management to dismiss, remove or  reduce
\nin  rank of an employee, must be consistent with just,\trea-
\nsonable and fair procedure. It would, further, be held\tthat
\nright to public employment which includes right to continued
\npublic employment till the employee is superannuated as\t per
\nrules or compulsorily retired or duly terminated in  accord-
\nance  with the procedure established by law is\tan  integral
\npart  of  right to livelihood which in turn is\tan  integral
\nfacet  of right to life assured by Art. 21 of the  Constitu-
\ntion.  Any procedure prescribed to deprive such a  right  to
\nlivelihood  or continued employment must be just,  fair\t and
\nreasonable procedure. In other words an employee in a public
\nemployment also must not be arbitrarily unjustly and  unrea-
\nsonably\t be deprived of his\/her livelihood which is  ensured
\nin continued employment till it is terminated in  accordance
\nwith just, fair and reasonable procedure. Otherwise any\t law
\nor rule in violation thereof is void.\n<\/p>\n
Need  for  harmony between social  interest  and  individual
\nright\n<\/p>\n
     34.  Undoubtedly efficiency of the\t administration\t and
\nthe  discipline\t among the employees is very  vital  to\t the
\nsuccessful functioning of an institution or maximum  produc-
\ntion of goods or proper maintenance of the services.  Disci-
\npline  in that regard among the employees is  its  essential
\nfacet  and  has\t to be maintained. The\tsociety\t is  vitally
\ninterested in the due discharge of the duties by the govern-
\nment employees or
\n321<\/span>
\nemployees  of corporate bodies’or statutory  authorities  or
\ninstrumentalities under Art. 12 of the Constitution. As held
\nin  Tulsiram Patel’s case the public are vitally  interested
\nin  the efficiency and integrity of the public service.\t The
\ngovernment or corporate employees are, after all, paid\tfrom
\nthe public exchequer to which everyone contributes either by
\nway  of direct or indirect taxes. The employees are  charged
\nwith public duty and they should perform their public duties
\nwith deep sense of responsibility. The collective  responsi-
\nbility\tof  all\t the officers from top most  to\t the  lowest
\nmaximises  the efficient public administration.\t They  must,
\ntherefore, be held to have individual as well as  collective
\nresponsibility\tin  discharge of  their\t duties\t faithfully,
\nhonestly  with full dedication and utmost devotion  to\tduty
\nfor the progress of the country. Equally the employees\tmust
\nalso have a feeling that they have security of tenure.\tThey
\nshould also have an involvement on their part in the organi-
\nsation or institution, corporation, etc. They need assurance
\nof service and they need protection. The public interest and
\nthe  public  good  demand, that those  who  discharge  their
\nduties\thonestly, efficiently and with a sense\tof  devotion
\nand  dedication to duty should receive\tadequate  protection
\nand  security of tenure. Equally inefficient, dishonest\t and
\ncorrupt or who became security risk should be weeded out  so
\nthat  successful functioning of the industry or\t manufacture
\nof the goods or rendering or services would be available  at
\nthe  maximum  level to the society and society\tthereby\t re-
\nceives\toptimum\t benefit from the public money\texpanded  on
\nthem as salary and other perks. Therefore, when a  situation
\nenvisaged  under statute or statutory rule or regulation  or
\ninstructions having statutory force to remove or dismiss  an
\nemployee  the  question arises whether they  need  at  least
\nminimum protection of fair play in action.\n<\/p>\n
    34A.  In  Vasayya’s case when a similar  contention\t was
\nraised I have stated at p. 47 in Para 130 & 13 1 that.
\n    The Audi alteram partem rule must be flexible; malleable
\nand  an adaptable concept to adjust and harmonise  the\tneed
\nfor  speed and obligation to act fairly. When the rights  of
\nthe Government are widely stressed, the rights of the person
\nare  often threatened, when the latter are  ever  emphasised
\nGovernment  becomes weak to keep order. Therefore, the\trule
\ncan be tailored and the measure of its application cut short
\nin reasonable proportion to the exigencies of the situation.
\nThe  administrative agency can develop a technique of  deci-
\nsion worthy being called “ethos of adjudication”. Meaningful
\nstatutory  standards, realistic procedural requirements\t and
\ndiscriminatory\ttechniques of judicial review are among\t the
\ntools to control the discretionary
\n322<\/span>
\npower.\tIt makes no difference whether the occasion for\t the
\nexercise of power is personal default or act of policy. Good
\nadministration\tdemands fair consultation in each  case\t and
\nthis  the law can and should enforce. The insistence of\t the
\nobservance of fundamental fairness in the procedure  becomes
\na  balancing  balm to alleviate\t apprehension  of  arbitrary
\ndecision by the executive Government while assuring opportu-
\nnity  to disabuse the prima facie impression formed  against
\nthe  person  to usher in a era of largest  good\t to  largest
\nnumber\tof  people with proper checks and  balances  between
\nneeds  of  the State and the rights of the  individual.\t The
\nbrooding omni benevolence and omnicompetency of the need for
\nexpediency  and claim for justness interplay ethos  of\tfair
\nadjudication in action.\n<\/p>\n
    34B.  Therefore, it is no well tuned solace to say\tthat
\nin  a  court of law at the fag end of the currier  or  after
\nsuperannuation in the interregnum which often over takes the
\nlitigation,  that the employee would be meted out with\tjus-
\ntice  (a grave uncertainty and exposing to frustrating\tpro-
\ncrastination  of  judicial process and expenses\t and  social
\nhumiliation).  Before depriving an employee of the means  of
\nlivelihood  to\thimself and his dependents,  i.e.  job,\t the
\nprocedure  prescribed for such deprivation must,  therefore,
\nbe just, fair and reasonable under Arts. 21 and 14 and\twhen
\ninfringes Art. 19(1)(g) must be subject to imposing reasona-
\nble restrictions under Art. 19(5). Conferment of power on  a
\nhigh rank officer is not always an assurance, in  particular
\nwhen the moral standards are generally degenerated that\t the
\npower would be exercised objectively, reasonably,  conscien-
\ntiously, fairly and justly without inbuilt protection to  an
\nemployee.  Even\t officers  who do their\t duty  honestly\t and
\nconscientiously\t are subject to great pressures\t and  pulls.
\nTherefore, the competing claims of the “public interest”  as
\nagainst\t “individual  interest” of the employees are  to  be
\nharmoniously  blended so as to serve the societal need\tcon-
\nsistent with the constitutional scheme.\n<\/p>\n
Statutory Construction:\n<\/p>\n
    35. Statutory construction raises a presumption that  an
\nAct  or a provision therein a constitutionally valid  unless
\nit  appears to be ultra vires or invalid.  The\tlegislature,
\nsubject to the provisions of the Constitution, has  undoubt-
\nedly  unlimited\t powers\t to make law.  In  fairness  to\t the
\nlearned Attorney General, he agrees that the impugned provi-
\nsions  are per se invalid. But he attempted to salvage\tthem
\nby resorting to the doctrine of reading down.\n<\/p>\n
323<\/span><\/p>\n
Reading a provision down when permissible.
\n    The\t question  emerges whether the doctrine\t of  reading
\ndown  would  be\t applied to avoid a void  law  vesting\twith
\narbitrary  power with a naked hire and fire draconian  rule.
\nIt  is\tdifficult to give acceptance to\t extreme  contention
\nraised\tby  Sri\t Garg and Sri Rama Murthy  that\t the  Courts
\ncannot in the process of interpretation of the Statute would
\nnot  make law but leave it to the legislature for  necessary
\namendments.  In an appropriate case Judges would  articulate
\nthe inarticulate major premise and would give life and force
\nto  a  Statute by reading harmoniously\tall  the  provisions
\nironing\t out the freezes. But the object is to alongate\t the
\npurpose of the Act. In this regard 1 respectfully agree with
\nmy learned brother, my Lord the Chief Justice, on the  prin-
\nciple  of  statutory construction. The question\t is  whether
\nLegislature intended to confer absolute power or would it be
\nconstrued in such a way that would supplant the law but\t not
\nsupplement law made by the Legislature.\n<\/p>\n
35A. Natural construction.\n<\/p>\n
    The\t golden rule of statutory construction is  that\t the
\nwords and phrases or sentences should be construed according
\nto  the intent of legislature that passed the Act.  All\t the
\nprovisions  should  be read together. If the  words  of\t the
\nstatutes  are  in themselves precise  and  unambiguous,\t the
\nwords, or phrases or sentences themselves alone do, then  no
\nmore can be necessary than to expound those words or phrases
\nor sentences in their natural and ordinary sense. But if any
\ndoubt arises from the terms employed by the legislature,  it
\nhas  always been held a safe means of collecting the  inten-
\ntion,  to  call in aid the ground and cause  of\t making\t the
\nstatute, and to have the recourse to the preamble, which  is
\na key to open the minds of the makers of the statute and the
\nmischiefs  which the Act intend to redress.  In\t determining
\nthe  meaning of statute the first question to ask always  is
\nwhat  is  the natural or ordinary meaning of  that  word  or
\nphrase in its context. It is only when that meaning leads to
\nsome result which cannot reasonably be supposed to have been
\nthe intent of the legislature then it is proper to look\t for
\nsome  other possible meaning then the court cannot  go\tfur-
\nther.\n<\/p>\n
     35. Craie’s Statute Law, Seventh Edition in Chapter  5,
\nat  page 64 it is stated that where the words of an Act\t are
\nclear,\tthere is no need for applying any of the  principles
\nof interpretation which are merely presumptions in cases  of
\nambiguity in the statute. The safer and more correct  course
\nof dealing with the question of construction is to take
\n324<\/span>
\nthe  words  themselves\tand arrive, if\tpossible,  at  their
\nmeaning without in the first place refer to cases. Where  an
\nambiguity  arises to supposed intention of the\tlegislature,
\none of the statutory constructions, the court profounded  is
\nthe  doctrine. of reading down. Lord Reid in  Federal  Steam
\nNavigation Co. v. Department of Trade and Industry, [1974] 2
\nAll E.R. 97 at p. 100 (as also extracted by Cross  Statutory
\nInterpretation,\t Butterworths’ Edition, 1976 at page  43  in
\npreposition 3) has stated thus:\n<\/p>\n
“the judge may read in words which he considers to be neces-
\nsarily implied by words which are already in the statute and
\nhe has a limited power to add to, alter or ignore  statutory
\nwords in order to prevent a provision from being  unintelli-
\ngible,\tabsured\t or  totally  unreasonable,  unworkable,  or
\ntotally irre-concileabIe with the rest of the statute.”\n<\/p>\n
    At\tpage 92 of the Cross Statutory\tInterpretation,\t the
\nauthor has stated that “The power to add to, alter or ignore
\nstatutory  words  is  an extremely  limited  one.  Generally
\nspeaking  it  can only be exercised where there has  been  a
\ndemonstrable  mistake on the part of the draftsman or  where
\nthe consequence of applying the words in their ordinary,  6r
\ndiscernible  secondary, meaning would be utterly  unreasona-
\nble.  Even  then  the mistake may be thought  to  be  beyond
\ncorrection by the court, or the tenor of the statute may  be
\nsuch as to preclude the addition of words to avoid an unrea-
\nsonable result.” Therefore, the Doctrine of Reading Down  is
\nan internal aid to construe the word or phrase in statute to
\ngive  reasonable  meaning,  but not to\tdetract\t distort  or
\nemasculate  the language so as to give the supposed  purpose
\nto avoid unconstitutionality
\n    35C.  This\tCourt in Saints High  School,  Hyderabad  v.
\nGovt. of A.P., [1980] 2 SCR 924 held that:\n<\/p>\n
“this  Court has in several cases adopted the  reading\tdown
\nthe provisions of the Statute. The reading down of a  provi-
\nsion of a statute puts into operation the principle that  so
\nfar  as\t is reasonably possible to do  so,  the\t legislation
\nshould\tbe  construed as being within its power. It  is\t the
\nprinciple effect that where an Act is expressed in  language
\nof  a generality which makes it capable, if read  literally,
\nof  applying to matters beyond relevant\t legislative  power,
\nthe Court would construe it in a more limited sense so as to
\nkeep it within the power.”\n<\/p>\n
325<\/span><\/p>\n
Similarly restricted meaning was ascribed by Maxwell in\t his
\nInterpretation of the Statutes XII Edn. at p. 109 under\t the
\ncaption\t “Restriction of operation” that sometimes  to\tkeep
\nthe  Act within the limits of its scope and not\t to  disturb
\nthe  existing  law beyond what the object  requires,  it  is
\nconstrued  as operative between certain purposes  only\teven
\nthough\tthe  language expresses no  such  circumspection  of
\nfield of operation.\n<\/p>\n
    36.\t It is, thus, clear that the object of reading\tdown
\nis  to keep the operation of the statute within the  purpose
\nof  the Act and consitutionally valid. In this regard it  is
\nequally\t of  necessity to remind ourselves as held  by\tthis
\nCourt in Minerva Mills’ case that when the effect of Art. 31
\nwas asked to be read down so as to save it from\t unconstitu-
\ntionality this Court held that it is not permissible to read
\ndown the statutory provisions when the avowed purpose is  to
\nconfer power on an authority without any limitation whatever
\nand that at p. 259D and G it was held that the principle  of
\nreading\t down cannot be used to distort when words of  width
\nare  used even advertantly. In Elliott Ashton Welsh,  II  v.
\nUnited States. 398 U.S. 333 (26 Lawyer’s Edition 2nd, 308 at\n<\/p>\n
327) Herfan, J. at 327 held that “when the plain thrust of a
\nlegislative enactment can only be circumvented by distortion
\nto  avert constitutional collision, it can only by  exalting
\nform over substance that one can justify veering of the path
\nthat  has been plainly marked by the Statute. Such a  course
\nbetrays\t extreme skepticism as to constitutionality  and  in
\nthis  instance reflects a groping to preserve  conscientious
\nobjecter exemption at all costs I cannot subscribe wholly to
\nemasculated  construction of a statute to avoid facing\tcon-
\nstitutional question in purported fidelity to the  statutory
\ndoctrine of avoiding unnecessary resolution of constitution-
\nal issues.”\n<\/p>\n
    36A. In Nalinakhya Bysack v. Shyam Sunder Haldar & Ors.,<\/a>
\n[1953]\tSCR 533 at 544-45 this Court has refused to  rewrite
\nlegislation to make up omissions of the Legislature.
\n    In Moti Ram Deka’s case when Rule 148(3) and Rule 149(3)
\nof  the\t Railway Establishment Code were sought to  be\tsus-
\ntained\ton the ‘principle of reading down’, this court\theld
\nthus:\n<\/p>\n
“There\tis one more point which still remains to be  consid-
\nered  and  that is the point of\t construction.\tThe  learned
\nAddl.  Solicitor General argued that in construing  the\t im-
\npugned R. 148(3) as well as R. 149(3), we ought to take into
\naccount the fact that the Rule as amended has been so
\n326<\/span>
\nframed\tas to avoid conflict with or non-compliance of,\t the
\nprovisions  of\tArt.  311(2), and so, he  suggests  that  we
\nshould adopt that interpretation of the Rule which would  be
\nconsistent with Art. 311(2). The argument is that the termi-
\nnation\tof  services permissible under\tthe  impugned  rules
\nreally proceeds on administrative grounds or  considerations
\nof exigencies of service. If, for instance, the post held by
\na permanent servant is abolished, or the whole of the  cadre
\nto  which  the post belonged is brought to an  end  and\t the
\nrailway\t servant’s services are terminated  in\tconsequence,
\nthat  cannot amount his removal because the  termination  of
\nhis  service is not based on any consideration\tpersonal  to
\nthe servant. In support of this argument, the Addl.  Solici-
\ntor General wants us to test the provision contained in\t the
\nlatter\tportion of the impugned rules. We are not  impressed
\nby  this argument. What are not impressed by this  argument.
\nWhat  the  latter portion of the impugned Rules\t provide  is
\nthat  in  case a railway servant is dealt  with\t under\tthat
\nportion, no notice need be served on him. The first part  of
\nthe Rules can reasonably and legitimately take in all  cases
\nand  may be used even in respect of cases falling under\t the
\nlatter category, provided, of course, notice for the  speci-
\nfied period or salary in lieu of such notice is given to the
\nrailway servant. There is no doubt that on a fair  construc-
\ntion,  the impugned Rules authorise the Railway\t Administra-
\ntion to terminate the services of all the permanent servants
\nto  whom  the Rules apply merely on giving  notice  for\t the
\nspecified period or on payment of salary in lieu thereof and
\nthat clearly amounts to the removal of the servant in  ques-
\ntion.  Therefore, we are satisfied that the  impugned  rules
\nare  invalid  inasmuch\tas they are  inconsistent  with\t the
\nprovisions contained in Art. 311(2). The termination of\t the
\npermanent  servant’s tenure which is authorised by the\tsaid
\nRules  is no more and no less than their removal from  serv-
\nice,  and so, Art. 311(2) must come into play in respect  of
\nsuch  cases. That being so, the Rule which does not  require
\ncompliance with the procedure prescribed by Art. 311(2) must
\nbe struck down as invalid.”\n<\/p>\n
    37.\t I am, therefore, inclined to hold that\t the  Courts
\nthough, have no power to amend the law by process of  inter-
\npretation,  but\t do  have power to mend it so as  to  be  in
\nconfirmity with the intendment of the legislature.  Doctrine
\nof reading down is one of the principles of
\n327<\/span>
\ninterpretation\tof  statute in that process.  But  when\t the
\noffending language used by the legislature is clear, precise
\nand  unambiguous, violating the relevant provisions  in\t the
\nconstitution, resort cannot be had to the doctrine of  read-
\ning down to blow life into the void law to save from  uncon-
\nstitutionality or to confer jurisdiction on the legislature.
\nSimilarly  it cannot be taken aid of to emasculate the\tpre-
\ncise,  explicit,  clear and unambiguous language  to  confer
\narbitrary,  unbridled and uncanalised power on\tan  employer
\nwhich  is a negation to just, fair and reasonable  procedure
\nenvisaged  under Articles 14 and 21 of the Constitution\t and
\nto  direct  the authorities to record  reasons,\t unknown  or
\nunintended  procedure, in the manner argued by\tthe  learned
\ncounsel for the appellants.\n<\/p>\n
    38.\t At the cost of repetition it is to  reiterate\tthat
\nwhen  the authority intends to take disciplinary action\t for
\nimposing penalty of dismissal, removal or reduction in\trank
\nof an employee, an elaborate procedure has been provided  in
\nRegulation  15 to conduct an enquiry into  misconduct  after
\ngiving\treasonable  opportunity. Residuary  power  has\tbeen
\navowedly  conferred in Regulation 9(b) with wide  discretion
\non the appropriate authority to take actions on similar\t set
\nof  facts  but without any guidelines or  procedure  at\t the
\nabsolute  discretion of the same authority. The language  of
\nRegulation 9(b) is not capable of two interpretations.\tThis
\npower  appears\tto  be in addition to the  normal  power  in
\nRegulation 15. Thereby the legislative intention is manifest
\nthat  it intended to confer such draconian power couched  in
\nlanguage  of  width which hangs like Damocles sword  on\t the
\nneck  of the employee, keeping every employee on  tenterhook
\nunder constant pressure of uncertainty, precarious tenure at
\nall  times right from the date of appointment till  date  of
\nsuperannuation. It equally enables the employer to pick\t and
\nchoose an employee at whim or vagary to terminate the  serv-
\nice arbitrarily and capriciously.\n<\/p>\n
    39. Regulation 9(b), thereby deliberately conferred wide
\npower  of  termination of services of the  employee  without
\nfollowing  the\tprinciple  of audi alteram  partem  or\teven
\nmodicum\t of procedure of representation\t before\t terminating
\nthe services of permanent employee. It is well settled\trule
\nof statutory construction that when two interpretations\t are
\npossible one which would preserve and save constitutionality
\nof  a  particular Statute, would be preferred to  the  other
\nthat  would  render it unconstitutional and void.  When\t the
\nlanguage is clear, unambiguous and specific and it does\t not
\nlead  to  the constructions, it is not permissible  to\tread
\ninto those provisions something which is not intended. It is
\nundoubtedly true as rightly contended by
\n328<\/span>
\nMr.  Ashok  Desai, the learned Solicitor  General  that\t the
\npower to take appropriate and expeditious action to meet the
\nexigencies  of\tweeding out inefficient,  corrupt,  indolent
\nofficers  or employees from service should be  provided\t and
\npreserved  to  the  competent authority.  Any  action  taken
\nwithout any modicum of reasonable procedure and prior oppor-
\ntunity always generates an unquenchable feeling that  unfair
\ntreatment  was meted out to the aggrieved employee. To\tpre-
\nvent miscarriage of justice or to arrest a nursing grievance
\nthat  arbitrary,  whimsical or capricious action  was  taken
\nbehind the back of an employee without opportunity, the\t law
\nmust  provide  a fair, just and reasonable procedure  as  is
\nexigible  in a given circumstances as adumbrated in  proviso
\nto Art. 311(2) of the Constitution. If an individual  action
\nis taken as per the procedure on its own facts its  legality
\nmay  be tested. But it would be no justification  to  confer
\npower  with  wide discretion on any  authority\twithout\t any
\nprocedure  which would not meet the test of justness,  fair-
\nness  and reasonableness envisaged under Arts. 14 and 21  of
\nthe Constitution. In this context it is important to  empha-
\nsise that the absence of arbitrary power is the first essen-
\ntial of the rule of law upon which our whole  constitutional
\nsystem\tis based. In a system governed by rule of law,\tdis-
\ncretion, when conferred upon executive authorities, must  be
\nconfined  within defined limits. The rule of law  from\tthis
\npoint  of  view means that decisions should be made  by\t the
\napplication  of known principles and rules and, in  general,
\nsuch decisions should be predictable and the citizen  should
\nknow where he is. If a decision is taken without any princi-
\nple  or\t without  any rule it is unpredictable\tand  such  a
\ndecision is the antithesis of a decision taken in accordance
\nwith   the   rule   of\tlaw.   (See   Dicey–“Law   of\t the
\nConstitution”–10th Edn., Introduction cx). “Law has reached
\nits finest moments”, stated Douglas, J. in United States  v.
\nWunderlick,  342  U.S. 98 “then it has freed  man  from\t the
\nunlimited discretion of some rules ……….  where discre-
\ntion  is absolute, man has always suffered”. It is  in\tthis
\nsense that the rule of law may be said to be the sworn enemy
\nof  caprice.  Discretion,  as Lord Mansfield  stated  it  in
\nclassic\t terms\tin  the case of John  Wilkes  “means  should
\ndiscretion  guided by law. It must be governed by rule,\t not
\nby humour; it must not be arbitrary, vague and fanciful,” as
\nfollowed  in  this  Court in S.G. Jaisinghani  v.  Union  of
\nIndia., [1967] 2 SCR 703.\n<\/p>\n
    40. In an appropriate case where there is no  sufficient
\nevidence  available to inflict by way of disciplinary  meas-
\nure,  penalty  of dismissal or removal from service  and  to
\nmeet such a situation, it is not as if that the authority is
\nlacking\t any  power to make Rules or regulations to  give  a
\nnotice\tof opportunity with the grounds or the\tmaterial  on
\nrecords on
\n329<\/span>
\nwhich  it proposed to take action, consider  the  objections
\nand record reasons on the basis of which it had taken action
\nand  communicate the same. However scanty the  material\t may
\nbe,  it must form foundation. This minimal procedure  should
\nbe made part of the procedure lest the exercise of the power
\nis  capable  of abuse for good as well as for  whimsical  or
\ncapricious purposes for reasons best known to the  authority
\nand  not  germane for the purpose for which  the  power\t was
\nconferred.  The action based on recording reasoning  without
\ncommunication would always be viewed with suspicion.  There-
\nfore,  1 hold that conferment of power with wide  discretion
\nwithout any guidelines, without any just, fair or reasonable
\nprocedure  is constitutionally anathema to Arts. 14,  16(1),
\n19(1)(g)  and  21 of the Constitution. Doctrine\t of  reading
\ndown cannot be extended to such a situation.\n<\/p>\n
    41. It is undoubted that in In re Hindu Women’s Right to
\nProperty  Act, [1941] FCR 12 involve the  interpretation  of
\nsingle word “property” in the context to legislative  compe-
\ntency  but  that cannot be extended to the  facts  of  these
\ncases. R.M.D. Charnarbaugwalla’s case is of severability and
\nof  a  single word competition. The  interpretation  therein
\nalso  cannot be extended to the facts of these\tcases.\tEven
\nthe  case of K.N. Singh v. State of Bihar, [19621  Suppl.  2
\nSCR  769 involve interpretation of Section 124(A) I.P.C.  in
\nthe  context  of  freedom of  speech  enshrined\t under\tArt.
\n19(1)(a) of the Constitution. The interpretation was put  as
\nto  subserve the freedom under Art. 19(1)(a). R.L. Arora  v.
\nState  of  U.P.,<\/a> [1964] 6 SCR 784 does not  involve  of\t the
\ndoctrine  of  reading down so as to cut down  the  scope  of
\nFundamental Right. Similarly Jagdish Pandey v. Chancellor of
\nthe  Bihar,<\/a>  [1969] 1 SCR 23 1 also does  not  concern\twith
\napplication  of doctrine of reading down so as to  sacrifice
\nthe  principle\tof natural justice which are  considered  as
\nessential  part of rule of law. In Amritsar Municipality  v.
\nState of Punjab, [1969] 3 SCR 447 the court ascertained\t the
\nintention  of the Legislature and interpreted the  Act\tcon-
\nsistent with the said intention. Sunil Batra v. Delhi Admn.,<\/a>
\n[1978] 4 SCC 494 is also a decision where it was found\tthat
\nthe intention of the Legislature was not to confer arbitrary
\npower. N.C. Dalwadi v. State of Gujarat,<\/a> [1987] 3 SCC 611 is
\nalso  a case giving reasonable interpretation of the  inten-
\ntion of the provisions of the Statute and is not capable  of
\nthe  meaning.  In Charanlal Sahu v. Union of  India,  [1989]
\nSuppl.\tScale  (1)  at p. 61 on which  strong  reliance\t was
\nplaced\tby both the learned Attorney General  and  Solicitor
\nGeneral, is a case capable of two interpretations to Sec. 4.
\nThe decisions cited by Shri Ashok Desai i.e. Delhi Transport
\n330<\/span>
\nUndertaking  v.\t Balbir Saran Goel,<\/a> [1970] 3  SCR  757;\t Air
\nIndia  Corporation v. Rebellow,<\/a> [1972] 3 SCR 606;  Municipal
\nCorporation  of Greater Bombay v. P.S. Malvankar,<\/a>  [1978]  3
\nSCR 1000 concern the industrial Iaw wherein the validity  of
\nrules on the touch-stone of the reasonableness, fairness  or
\njustness  was  not considered. The  prevailing\tdoctrine  of
\nreasonable classification and nexus had their play to uphold
\nthe validity of the provisions.\n<\/p>\n
    42.\t It is undoubtedly true as contended by Sri  Bhasin,
\nlearned\t counsel for the intervener, that it is open to\t the
\nauthorities to terminate the services of a temporary employ-
\nee  without holding an enquiry. But in view of the match  of
\nlaw  made, viz., that it is not the form of the\t action\t but
\nthe substance of the order is to be looked into, it is\topen
\nto the Court to lift the veil and pierce the impugned action
\nto  find  whether the impugned action is the  foundation  to
\nimpose\tpunishment  or is only a motive. A larger  Bench  of
\nseven  Judges  of this Court in Shamsher Singh v.  State  of
\nPunjab, [1975] 4 SCR 814 elaborately considered the question
\nand laid down the rule in this regard. The play of fair play
\nis to secure justice procedural as well as substantive.\t The
\nsubstance  of the order, the effect thereof is to be  looked
\ninto. Whether no misconduct spurns the action or whether the
\nservices  of a probationer is terminated without  imputation
\nof  misconduct is the test. Termination simpliciter,  either
\ndue  to loss of confidence or unsuitability to the post\t may
\nbe  a relevant factor to terminate the services of a  proba-
\ntioner.\t But  it  must be hedged with  a  bonafide  over-all
\nconsideration  of the previous conduct without trained\twith
\neither\tmala-fide  or colourable exercise of  power  or\t for
\nextraneous considerations. Such actions were upheld by\tthis
\nCourt.\tThe action must be done honestly with due  care\t and
\nprudence.\n<\/p>\n
    43.\t In  view of the march of law made by  Art.  14,  in
\nparticular after Maneka Gandhi’s case, it is too late in the
\nday to contend that the competent authority would be  vested
\nwith wide discretionary power without any proper  guidelines
\nor the procedure. The further contention that the  preamble,
\nthe other rules and the circumstances could be taken aid  of
\nin reading down the provisions of the impugned rules or\t the
\nregulations  is also of no assistance when it is found\tthat
\nthe legislative intention is unmistakably clear, unambiguous
\nand  specific.\tThus  considered, I have  no  hesitation  to
\nconclude  that the impugned regulation 9(b) of\tthe  Regula-
\ntions are arbitrary, unjust, unfair and unreasonable offend-
\ning Arts. 14, 16(1), 19(1)(g) and 21 of the Constitution. It
\nis  also opposite to the public policy and thereby  is\tvoid
\nunder Section 23 of the Indian Contract Act.\n<\/p>\n
331<\/span><\/p>\n
    44. It is made clear that, as suggested by this Court in
\nHindustan Steel Case that it is for concerned to make appro-
\npriate\trules or regulations and to take appropriate  action
\neven without resorting to elaborate enquiry needed  consist-
\nent  with the constitutional scheme. The correctness of\t the
\ndecision in Tulsiram Patel’s case though was doubted in\t Ram
\nChunder\t v. Union of India, [1986] 2 SCR 980 it is  unneces-
\nsary to go into that question. For the purpose of this\tcase
\nit is sufficient to hold that proviso to Art. 311(2)  itself
\nis a constitutional provision which excluded the applicabil-
\nity  of Art. 311(2) as an exception for stated\tgrounds.  It
\nmust  be remembered that the authority taking  action  under
\neither of the clauses (b) or (c) to proviso are enjoined  to
\nrecord reasons, though the reasons are not subject to  judi-
\ncial scrutiny, but to find the basis of which or the  ground
\non which or the circumstances under which they are satisfied
\nto  resort to the exercise of the power under either of\t the
\ntwo  relevant clauses to proviso to Art. 311(2) of the\tCon-
\nstitution.  Recording  reasons\titself is  a  safeguard\t for
\npreventing  to take arbitrary or unjust action.\t That  ratio
\ncannot be made applicable to the statutory rules.\n<\/p>\n
    45.\t Accordingly I hold that the ratio  in\tBrojonath’s-
\ncase was correctly laid and requires no reconsideration\t and
\nthe  cases  are to be decided in the light of the  law\tlaid
\nabove. From the light shed by the path I tread, I express my
\ndeep  regrets  for  my inability to agree  with\t my  learned
\nbrother,  the Hon’ble Chief Justice on the applicability  of
\nthe doctrine of reading down to sustain the offending provi-
\nsions.\tI agree with my brothren B.C. Ray and  P.B.  Sawant,
\nJJ. with their reasoning and conclusions in addition to what
\nI have laid earlier.\n<\/p>\n
    46.\t The  appeal is accordingly dismissed,\tbut  without
\ncosts.\tSimilarly Civil Appeal No. 1115 of 1976\t is  allowed
\nand  the monetary relief granted is reasonable, but  parties
\nare  directed to bear their own costs. Rest of\tthe  matters
\nwill  be disposed of by the Division Bench in the  light  of
\nthe above law.\n<\/p>\n
     In view of the majority judgment, Civil Appeal No. 2876
\nof 1986 (Delhi Transport Corporation v. D.T.C. Mazdoor\tCon-<\/a>
\ngress) is dismissed. Civil Appeal No. 11 15 of 1976  (Satnam
\nSingh v. Zilla Parishad Ferozepur & Ant., is allowed and the
\nother  cases  snail be placed before a\tdivision  bench\t for
\nfinal disposal.<\/p>\n
\n\t\t\t       C.A. 2876\/86 is dismissed\n N.P.V.\t\t\t       &C.A. 1115\/76 isallowed.\n332<\/span>\n\n\n\n<\/pre>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Delhi Transport Corporation vs D.T.C. Mazdoor Congress on 4 September, 1990 Equivalent citations: 1991 AIR 101, 1990 SCR Supl. (1) 142 Author: S Mukharji Bench: Mukharji, Sabyasachi (Cj), Ray, B.C. (J), Sharma, L.M. (J), Sawant, P.B., Ramaswamy, K. PETITIONER: DELHI TRANSPORT CORPORATION Vs. RESPONDENT: D.T.C. MAZDOOR CONGRESS DATE OF JUDGMENT04\/09\/1990 BENCH: […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-221160","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nDelhi Transport Corporation vs D.T.C. 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