The Kerala State Housing Board vs Murali and Others

Bhaskaran Nambiar, J.—The jurisdiction of a statutory Corporation to direct deputation is the only aspect for consideration in these two appeal. Two apparently conflicting decisions of two learned Judges of this Court in two separate writ petitions have given rise to these appeals bv the same Appellant, the Kerala State Housing Board.

The Appellant, is a statutory Corporation constituted under the Kerala State Housing Board Act, 19 of 1971. This Act is the preparation and execution of Housing and improvement schemes'' in this State and the State Housing Board is constituted as a body corporate with perpetual succession and common seal to achieve these objects and for an effective implementation of the provisions of the Act. The Housing Commissioner to the Government is the ex-officio Secretary of the Board. The Secretary makes appointments to the posts inthe establishment of the Board and exercises all the powers prescribed under the Act. The Act enables the Board to make �Service regulations� u/s 19 and to make other regulations to give effect to the provisions of the Act, u/s 162.

Sri K.M. Jojo, was a Junior Engineer in the Cochin Shipyard, a Central Government undertaking and he was deputed for two years to the Housing Board in 1983. His deputation was subsequently extended till 12th December 1986 on which date his services were terminated and he was relieved of his duties under the Board. He was thus compelled to join his parent organisation, the Shipyard. He therefore, filed writ petition, O.P. No. 9499 of 1986, mainly for a direction that he be permanently absorbed in the services of the Housing Board. A learned Single Judge of this Court, Mr. Justice K.T. Thomas, dismissed the writ petition holding that the Housing Board is not empowered "for making an appointment on deputation" and therefore the writ Petitioner, "cannot, as a matter of right, claim that he is entitled to continue on deputation or to be absorbed in the services of the Board". W.A. No. 483 of 1987 is filed by the Housing Board.

The other writ petition, O.P. No. 5952 of 1986, was filed by the Upper Division Clerks of the Board when they apprehended that one post of Junior Superintendent was to be filled by deputation and they therefore prayed for issuance of appropriate directions to the Hous-ing Board , not to fill vacancies by posting persons on deputation. Justice Sivaraman Nair, assuming without hesitation, that the Board has powers of appointment on deputation, drew the parameters of this jurisdiction to prevent any arbitrary exercise of the power by the Board. The Housing Board has therefore filed the two appeals to set at rest this apparent conflict of decisions regarding its juri diction for appointment of officers on deputation.

In exercise of the powers conferred by Sub-section (5) of Section 17, Sub-section (2) of Section 18 read with Sub-section (2) of Section 161 of the Act, the Government framed the Housing Board Establishment Rules, 1974.

Rule 3 reads thus:

Application of the General Rules and of the Kerala Civil Services (Classification, Control and Appeal) Rules, 1960 to the Board Establishment subject to the provisions in Sub-section (2) of section 18 of the Act, the provisions of the Kerala State and Subordinate Service Rules, 1958 and of the Kerala Civil Servicc (Classification, Control and Appeal) Rules,'' 1960 as may be in force from time to time shall mutatis mutandis apply to the employees in the establishment of the Boaid.

Rule 4(2), relevant for our purpose, reads thus:

4, Appointing authority.-(1) * * *

(2) Subject to the provisions of these rules and the General Rules, every appointment by promotion or by transfer in the establshment of the Board shall be made by the Secretary, provided that any appointment by transfer of a servant of the State or Central Government shall be made with the prior approval of Government in the Department in charge of housing.

Rule 9B of the Kerala State and Subordinate Services Rules, which thus applies to the Board, is extracted below:

9B. Notwithstanding anything contained in these rules or in the Special Rules, the Government in ay, in public interest and for reasons to be recorded in writing depute or transfer officers from one service to Anr. or from one department to Anr. within the same service or send'' to or take in officers from other Governments or statutory bodies subject to such conditions as the Government may in each case impose:

Provided that in the case of transfr rs in the interest of security of State, the reasons need not be rccord d if Government are satisfied that it is not exp edient to disclose the reasons for such transfer:

Provided further that the Commission shall be consulted in respect of such deputations and transfers whenever such consultation has not been specifically excluded by the provisions of the Kerala Public Service Commission (Consultation) Regulations, 1957.

Interpreting Rule 9B along with Rule 3 of the Housing Board Establishment Rules, 1974, Justice Thomas held thus:

A reading of the aforesaid rule shows without any manner of doubt that it applies only to the employees of the establishment of the Board. Apparently, the rule does not empower the Board to exercise the power which the Government can exercise as per Rule 9B of the Kerala State and Subordinate Services Rules.

The other relevant provisions, namely, Section 18(2) of the Act and the Annexures to the Regulations, according to the learned Judge, do not define the source of authority for deputation and can therefore be of no help to assume that the jurisdiction has been so conferred, notwithstanding the fact that those provisions also deal with servants of Central of State Government or of a local authority whose services are lent to the Board.

We shall therefore advert to these allied provision8 also which throw considerable light on the impact of Rule 9B of the Kerala State and Subordinate Services Rules (K.S. and S.S.R.) on the Housing Board staff. Section 19 of the Kerala State Housing Board Act which provides for the making of service regulations by the Board engrafts a proviso relating to the service conditions of Central and State Government employees employed in the Housing Board. This provision therefore contemplates the appointment on deputation to the Housing Board of Central and State Government employees. The proviso reads thus:

Provided that a servant of the Central or the State Government employed as an officer or servant of the Board shall not be entitled to leave or leave allowances, otherwise than as laid down in the conditions of his service under the Central or the State Government relating to transfer to foreign service.

The Housing Board, has, as already noticed, framed establishment regulations prescribing the qualifications and methods of recruitment to various categories of posts in the Board. The annexure to this regulation specifies the categories of posts, provides the method of .appointment for each category of post and shows separately the qualifications required for each post. It is seen that transfer of suitable officers from the State Government service to the Housing Board is one of the common methods prescribed for several categories of posts. In item 24 in the annexure with which we are concerned in W.A. No. 483 of 1987, Assistant Engineer (now redesignated as Assistant Executive Engineer) is appointed either by promotion of Junior Engineer (now redesignated as Assistant Engineer) or by transfer from the category of Assistant Engineer (Assistant Executive'' Engineer) in Government service. The scope and content of Rule 9B of the K.S. and S.S.R. statutorily adopted by the Housing Board cannot be understood in isolation without reference to the various provisions in the Act and the statutory Rules and Regulations.

The Supreme Court, in the recent decision in R.L. Gupta and Anr Vs. Union of India (UOI) and Ors, recognised the principle of deputation of officers thus:

It is well-known that many officers have to be sent on deputation in the public interest to other departments in order to meet the exigencies of public service and that before sending them on deputation their consent is invariably taken. Merely because they have given their consent to go on deputation they should not be allowed to suffer unless there is a specific rule to the contrary or other good reason for it.

Rule 9B of the Kerala State and Subordinate Services Rules deals with deputation of officers and engrafts an accepted principle in Service law that the exigencies of service may, in public interest, require deputation of officers from one service to Anr. or from one department to Anr. or even from Government service to statutory bodies and vice versa. Deputation in service parlance, is a recognised mode of transfer and Rule 9B prevents the arbitrary exercise of this power of deputation by insisting that it can be done only in public interest and for reasons to be recorded in writing. Reasons need not be recorded if the deputation is made in the interest of the security of the State. Rule 9B is thus not a conferment of a new power of deputation unknown in administrative law, but only declaratory of an existing recognised power in service jurisdiction. Rule 9B cannot therefore be understood as excluding a power of deputation of officers to the Housing Board. The Act in Section 19(2) and the rules, especially Rule 4(2) of the establishment rules made by the Government and the establishment regulations made by the Board, particularly the annexure to those regulations, contemplate transfers of Government officers to the Housing Board and it cannot be assumed that these provisions were inserted without any regard to the source of power to depute. It is difficult to ignore these provisions and exclude Rule 9B altogether to deprive the Board of its power of appointment on deputation.

Section 19(2) and the Establishment Rules and Regulations will be meaningless statutory exercises if no power to depute is conceded to the Board or conferred by Rule 9B. Rule 9B of the Kerala State and Subordinate Services Rules and Section 19(2) of the Act and the Establishment Rules and regulations have therefore to be interpreted and .understood harmoniously to give life and meaning to all the statutory provisions.

Referring to Rule 3 of the Establishment Rules under which the Kerala State and Subordinate Services Rules were made applicable, mutatis mutandis to the employees in the establishment of the Board, the learned Judge in O.P. No. 9499 of 1986 held that the Kerala State and Subordinate Services Rules can apply only to employees of the Board and not to persons before they become their employees and thus Rule 9B which applies to persons other than employees of the Board can have no application. With respect to the learned Judge, it is difficult to agree with this reasoning. Kerala State and Subordinate Services Rules are general rules applicable to all State and Subordinate Services and the holders of all posts, whether temporary or permanent, appointed before or after the coming into force of those rules on 17th December 1958. It is in this general rule that Rule 9B provides for deputation not only of those in the State and subordinate services but also officers of statutory bodies. This is expressly provided in this rule. Adoption of Rule 9B by the Housing Board enables at least deputation of the employees of the Housing Board to the State Government , and at least to that extent Rule 9B is applicable to the Board, even accepting the reasoning of the learned Judge that Rule 9B read with Rule 3 of the establishment regulations apply only to the employees of the Board. It cannot be that only one part of Rule 9B applies to the Board and the remaining part has no application. It is difficult to dissect Rule 9B in this manner. A person is borne in the establishment of the Board only after appointment. If a rule prescribes the manner and method of appointment of an employee, it cannot be said that the said rule does not apply because the person to be appointed has not already become an employee. Rule 9B provides one method of appointment by deputation. This method should apply to the Housing Board when that rule is made applicable to the Board. That is what has been done under Rule 3, when Rule 9B is made applicable to the Board statutorily.

There is intrinsic evidence in Rule 9B itself that it applies to the Housing Board. The words "take in officers from other Governments or statutory bodies" occurring in Rule 9B indicate that the employees of the Board can be deputed to Government service. Rule 9B is applicable to the employees of the Board. The effect of adoption of Rule 9B of the Kerala State and Subordinate Services Rules by the Housing Board in its application to the employees of the Board is that the employees of the Board are liable to be deputed to Government service just as employees of the Government are liable to be deputed to the Board. We, therefore, hold that there is ample power in the Housing Board to exercise the power of deputation under Rule 9B of the Kerala State and Subordinate Services Rules read with Rule 3 of the establishment regulations and with respect, we are unable to agree with the reasoning and conclusion of the learned Judge in O.P. No. 9499 of 1986 on the interpretation of Rule 9B of the Kerala State and Subordinate Services Rules in its application to the Housing Board.

When the establishment regulations of the Board prescribe transfer of Government employees as one of the methods of recruitment to any particular post and also prescribes the qualifications for the post, it is clear that there can be no deputation or transfer of any officer who does not possess the qualification so prescribed, for, then the deputation/transfer will be opposed to the statutory regulations/rules. Similarly, deputation which is clearly mala fide, made for extraneous purposes intended to defeat the rightful claimant for promotion under the regulations or rules, may, in appropriate cases, be amenable to judicial correction or administrative review. We are, therefore, in agreement with the views expressed by Justice SivaTaman Nair that Rule 9B of thp Kerala State and Subordinate Services Rules provides the reasonable guidelines for the exercise of the power of deputation. We are not concerned in these two appeals with any arbitrary exercise of that power, for, in W.A. No. 483 of 1987 it was stated that the Writ Petitioner in O.P. No. 9499 of 1986 has been sent back to the Shipyard after his period of deputation and in W.A. No. 449 of 1987, it is reported that the Board did not propose to depute any officer to be appointed as Junior Superintendent overlooking the claim of the Senior qualified employees of the Board for promotion to that post.

It is, therefore, necessary only to declare the law regarding the scope of deputation under Rule 9B of the Kerala State and Subordinate Services Rules in its applicability to the State Housing Board, as we have done in this judgment. No other directions are required to be issued and the Writ Appeals are disposed of accordingly.