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1996 (7) TMI 499 - SC - Indian LawsValidity of Rule 16(2) of the employees State Insurance (Central) Rules, 1950 and Regulations 12(2) and 13(1) of the Employees State Insurance Corporation (Staff and Condition of Service) Regulations, 1959 Held that - Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968, to the extent they empower the director General to further delegate the powers or duties delegated to him by the Corporation or the Standing Committee under a resolution referable to Section 94-A have to be held to be invalid. the impugned judgment of the Tribunal is set aside insofar as it strikes down the words or any other authority specified in this behalf by a general or special order of the Director General in Regulation 12(2) and the words or any other authority empowered by him by general or special order may in Regulation 13(1) of the Regulations and quashes the orders dated May 10, 1974 and April 9, 1981 passed by the Director General, the memoranda dated October 20, 1983, January 21, 1985 and July 18/25, 1986 and the order dated March 18, 1987, Rule 16(2) and the resolution of the Standing Committee, to the extent they empower the Director General to delegate the powers or duties delegated to him under any resolution of the Corporation or the Standing Committee referable to Section 94-A, Are invalid but the rest of the said Rule and the resolution are valid. As a result, the applications filed by the respondents before the Tribunal are dismissed.
Issues Involved:
1. Validity of Rule 16(2) of the Employees' State Insurance (Central) Rules, 1950. 2. Validity of Regulations 12(2) and 13(1) of the Employees' State Insurance Corporation (Staff and Condition of Service) Regulations, 1959. 3. Competence of the Regional Director to initiate disciplinary proceedings. 4. Delegation of powers by the Director General. 5. Validity of orders and resolutions passed by the Director General and the Standing Committee. Detailed Analysis: 1. Validity of Rule 16(2) of the Employees' State Insurance (Central) Rules, 1950: The Tribunal struck down Rule 16(2), which allows the Director General to delegate his powers or duties under the Rules or the Regulations or under any resolution of the Corporation or the Standing Committee to any subordinate. The Supreme Court found that Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968, which accords approval for such delegation, are valid insofar as they pertain to powers or duties under the Rules or Regulations. However, they are invalid to the extent they empower the Director General to delegate powers or duties conferred by any resolution referable to Section 94-A, as this would amount to impermissible sub-delegation. 2. Validity of Regulations 12(2) and 13(1) of the Employees' State Insurance Corporation (Staff and Condition of Service) Regulations, 1959: The Tribunal invalidated the words "or the authority specified in this behalf by a general or special order of the Director General" in Regulation 12(2) and "or any other authority empowered by him by general or special order may" in Regulation 13(1), viewing them as permitting sub-delegation. The Supreme Court held that these regulations confer independent statutory powers on the Director General and do not pertain to the delegation of powers from the Corporation or the Standing Committee under Section 94-A. Therefore, the offending words in Regulations 12(2) and 13(1) are valid. 3. Competence of the Regional Director to Initiate Disciplinary Proceedings: The Tribunal quashed the memoranda regarding the initiation of disciplinary proceedings by the Regional Director, deeming it beyond his competence. The Supreme Court clarified that it is not necessary for the authority competent to impose the penalty to initiate disciplinary proceedings. The Regional Director, being the controlling authority, could institute disciplinary proceedings against the respondents. Thus, the memoranda dated October 20, 1983, January 21, 1985, and July 18/25, 1986, do not suffer from any legal infirmity. 4. Delegation of Powers by the Director General: The Tribunal's view that the Director General could not delegate the powers delegated to him by the Corporation or the Standing Committee was based on the principle "delegatus non potest delegare." The Supreme Court distinguished between statutory powers conferred independently on the Director General under the Rules or Regulations and powers delegated under Section 94-A. The Director General's delegation of powers under Regulation 12(2) and 13(1) is valid as these regulations confer independent statutory powers. 5. Validity of Orders and Resolutions Passed by the Director General and the Standing Committee: The Tribunal quashed the Director General's orders dated May 10, 1974, and April 9, 1981, and the resolution of the Standing Committee dated May 24, 1968. The Supreme Court upheld the validity of these orders and resolution to the extent they pertain to the delegation of statutory powers under the Rules or Regulations. However, they are invalid concerning the delegation of powers under any resolution referable to Section 94-A. Conclusion: The Supreme Court set aside the Tribunal's judgment striking down the specified words in Regulations 12(2) and 13(1) and quashing the Director General's orders and the memoranda regarding initiation of disciplinary proceedings. The applications filed by the respondents were dismissed, and the appeals were disposed of accordingly. The petitioner's challenge based on the Tribunal's decision in T. Abdul Razak was also dismissed.
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