It may be mentioned that neither the said Act number Act No.49 of 1982 appears to have been yet brought into force.
This Act received the assent of the President on December 30, 1985.
It also quashed the impugned orders of termination dated February 26, 1983.
It is against the said judgment and orders of the Calcutta High Court that the present Appeals by Special Leave have been filed.
1604 of 1983 and in the case of Sengupta being F.M.A.T. No.
Each of the companytesting Respondents in these Appeals was asked to submit his written explanation to the various allegations made against him.
Thereafter, Service Rules were framed by the Corporation in 1970 which were replaced in 1979 by new rules namely, the said Rules.
His name was enrolled by the Bureau of Public Enterprises and he was called for an interview for the post of Chairman cum Director of the Corporation by the Public Enterprises Selection Board.
The First Appellant in both these Appeals, namely, the Central Inland Water Transport Corporation Limited hereinafter referred to in short as the Corporation , was incorporated on February 22, 1967.
The said Rules did number apply to employees companyered by the Industrial Employment Standing Orders Act, 1946, that is, to workmen, or to those in respect of whom the Board of Directors had issued separate orders.
budget estimates 1985 86 provide Rs.
The Judgment of the Court was delivered by MADON, J. These Appeals by Special Leave granted by this Court raise two questions of companysiderable importance to Government companypanies and their employees including their officers.
The Chairman, Vice Chairman and the other persons are to be appointed by the Central Government.
The action was number taken either under Rule 36 or Rule 37 number was either of them dismissed after applying to his case Rule 43 and dispensing with he disciplinary inquiry.
Under the letters of appointment issued to these Respondents, the age of superannuation was fifty five.
IX of 1872 , that unconscionability was number mentioned in the Indian Contract Act ,as one of the grounds which invalidates an agreement, that the power companyferred by Rule 9 i was necessary for the proper functioning of the administration of the Corporation, that in the case of the Respondents this power was exercised by the Chairman cum Managing Director of the Corporation, and that a person holding the highest office in the Corporation was number likely to abuse the power companyferred by Rule 9 i .
49 of 1982.
Under Rule 10 of the said Rules, they were to retire from the service of the Corporation on companypletion of the age of fifty eight years though in exceptional cases and in the interest of the Corporation an extension might have been granted to them with the prior approval of the Chairman cum Managing Director and the Board of Directors of the Corporation.
A beginning in respect of this matter was thus made by the enactment of the said Act No.
At all relevant times, these Respondents were employed mainly in a managerial capacity.
4413 of 1985, is companycerned, he was promoted to the post of General Manager River Services with effect from January 1, 1980.
Under the said Act, the said stretch was declared to be a national waterway and it was the responsibility of the Central Government to regulate and develop this national waterway and to secure its efficient utilization for shipping and navigation.
To meet cash losses over riverine and engineering operations, companystruction of vessel and for purchase of machinery equipment etc.,
G Both Ganguly and Sengupta filed writ petitions in Calcutta High Court under Article 226 of the Constitution challenging the termination of their service as also the validity of the said Rule 9 i .
No separate orders were issued by the Board of Directors in their case.
A Scheme of Arrangement was entered into between the said companypany and the Corporation.
Without holding any inquiry into the allegations made against them, the services of each of them were terminated by the said letter dated February 26, 1983, under Rule 9 i .
From the Judgment and Order dated 9.8.1985 of the Calcutta High Court in F.M.A.T. No.
This challenge levelled by the Respondent in each of these two Appeals succeeded in the High Court.
These Respondents were, therefore, admittedly governed by the said Rules.
Consequently the Division Bench struck down the said Rule 9 i as being void.
It also undertakes lighterage, stevedoring operations, ship building, ship repairing and other engineering services.
The First Appellant in both these Appeals, namely, the Central Inland Water Transport Corporation Limited, will pay to the First Respondent in each of these Appeals the companyts of the respective Appeals.649 of 1983.
13.50 crores for loan and Rs.
The companytentions raised on behalf of the Corporation at the hearing of these Appeals may be thus summarized A Government companypany stands on a wholly different footing from a statutory companyporation for while a statutory companyporation is established by a statute, a Government companypany is incorporated like any other companypany by obtaining a certificate of incorporation under the Companies Act and, therefore, a Government companypany cannot companye within the scope of the term the State as defined in Article 12 of the Constitution.
Along with the said letter a cheque for three months basic pay and dearness allowance in lieu of numberice was enclosed.
15.41 crores for equity investment in the Corporation.
So far as Ganguly, the First Respondent in Civil Appeal No.
4413 of 1985, denied the charges made against him and asked for inspection of the documents and companyies of statements of witnesses mentioned in the charge sheet served upon him to enable him to file his written statement.
The activities carried on by the Corporation were thus described in the said Demands for Grant Central Inland Water Transport Corporation CIWTC runs river services between Calcutta and Assam and Calcutta and Bangladesh.
The said appeals and writ petitions were thereupon heard together and by a companymon judgment delivered on August 9, 1985, the Division Bench held that the Corporation was a State within the meaning of Article 12 of the Constitution and that the said Rule 9 i was ultra vires Article 14 of the Constitution.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
By a letter dated February 26, 1983, signed by the Chairman cum Managing Director numberice was given to Sengupta under clause i of Rule 9 of the said Rule, terminating his service with the Corporation with immediate effect.
On January 28, 1985, the Division Bench ordered in both these Appeals that the said writ petitions should stand transferred to and heard by it along with the said appeals.
Last year Parliament passed the Inland Waterways Authority of India Act, 1985.
4412 of 1985, to reply within twenty four hours to the allegation of negligence in the maintenance of Provident Fund Accounts.
In both these writ petitions rule nisi was issued and an ex parte interim order staying the operation of the said numberice of termination was passed by a learned Single Judge of the High Court.
Shanti Bhushan, Subrata Ray and A.K. Sil for the Appellants.
4412 of 1985, is companycerned, he was promoted to the post of Manager Finance in October 1980 and also acted as General Manager Finance from November 1981 to March 1982.
Ganguli made a representation as also gave a detailed reply to the said show cause numberice.
The said Rules do number require that any disciplinary inquiry should be held before terminating an employees service under rule 37.
The Appellants before us went in Letters Patent Appeal before a Division Bench of the said High Court against the said ad interim orders, the appeal in the case of Ganguly being F.M.A.T. No.
So far as Sengupta, the First Respondent in Civil Appeal No.
4412 of 1985, gave a detailed reply to the said show cause numberice.
It is to companysist of a Chairman, a Vice Chairman and other persons number exceeding five.
On February 16, 1983, a companyfidential letter was sent to him by the General Manager Finance , who is the Third Appellant in Civil Appeal No.
Sengupta, the First Respondent in Civil Appeal No.
Dr. Y.S. Chitale, H.K. Puri, G.A. Shah, Mrs. Anil Katiyal, C.V. Subba Rao and R.N. Poddar for the Respondents.
4412 4413 of 1985.
By his letter dated February 10, 1983, addressed to the Chairman cum Managing Director, Sengupta denied the charges made against him and asked for inspection of documents and companyies of statements of witnesses mentioned in the said charge sheet.
Thereafter by a letter dated February 26, 1983, signed by the Chairman cum Managing Director of the Corporation, a numberice under clause i of Rule 9 of the said Rules was given to Ganguli terminating his service with the Corporation with immediate effect.
Along with the said letter a cheque for three months basic pay and dearness allowance was enclosed.
Ganguly, the First Respondent in Civil Appeal No.
The submissions of the companytesting Respondents, on the other hand, were that the parties did number stand on an equal S footing and did number enjoy the same bargaining power, that the companytract companytained in the service rules was one imposed upon A these Respondents, that the power companyferred by rule 9 i was arbitrary and uncanalized as it did number set out any guidelines for the exercise of that power and that even assuming it may number be void as a companytract in any event it offended Article 14 as it companyferred an absolute and arbitrary power upon the Corporation.
Mridul Ray and K. Swami for the Interveners.
Under this act, an Authority called the Inland Waterways Authority of India is to be companystituted and it is to be a body companyporate by the name aforesaid, having perpetual succession and a companymon seal, with power, subject to the provisions of the said Act, to acquire, hold and dispose of property, both movable and immovable, and to companytract and to sue and be sued by the said name.
1604 and 649 of 1983.
In the Demands for Grant of the Ministry of Shipping and Transport 1985 86 additional provision was made for an overall increase in Budget Estimates 1985 86 mainly for equity participation investment in the Corporation.
It undertakes movement of oil from Haldia to Budge Budge Paharpur for the Indian Oil Corporation.
