TaxTMI 
TaxTMI 
1996 (7) TMI 499
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....ef Executive Officer of the Corporation and is one of the Principal officers. Section 17 of the Act makes provisions with regard to staff other than the Principal Officers. In sub-section (2) of Section 17 it is provided that the Corporation shall, with the approval of the Central Government, make regulations regarding the method of recruitment, pay and allowances, discipline, superannuation benefits and other conditions of service of the members of its staff. Section 94-A, wherein provision has been made for delegation of powers, provides that the Corporation, and Subject to the regulations made by the Corporation in this behalf, the Standing Committee may direct that all of any of the powers and functions which may be exercised by the Corporation or the Standing Committee, as the case may be, may in relation to such matters and subject to such conditions, if any, as may be specified, by also exercisable by any officer or authority subordinate to the Corporation sub-section (1) of Section 95 of the Act empowers the Central Government to make rules not inconsistent with the Act for the purpose of giving effect to the provisions thereof. Under clause (d) of sub-section (2) of Sectio....
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....with the approval of the Standing Committee impose." The Regulations have been made by the Corporation in exercise of powers conferred by sub-section (1) of Section 97 read with clause (xxi) of sub-section (2) and sub-section (2-A) of the said Section and sub-section (2) of Section 17 of the Act. The Regulations apply to every whole-time employee of the Corporation other than the principal officers appointed under Section 16 of the Act. The Regulations contain provisions regarding appointment, probation, termination of service, pay, leave, provident fund, age of retirement pensionary benefits, control and discipline suspension, penalties etc, regulation 12 which relates to disciplinary authorities provides as follows :- "Regulation 12. Disciplinary Authorities- (1) The Director General may impose any of the penalties specified in regulation 11 on any employee. (2) Without prejudice to the provisions of sub-regulation (1) but subject to the provisions of sub-regulation (3) any of the penalties specified in regulation 11 may be imposed on any employee by the appointing authority or the authority specified in this behalf by a general of special order of the Director General. ....
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....I at Headquarters Officer. SCHEDULE - II 1. Head Clerks, Assistants/Managers Grade-III, Personal Assistants. 2. Insurance Inspectors/Audit Inspectors/Manager Grade - II" The said order was modified by order dated April 9, 1981 which reads as under:- "Office Order In exercise of the power conferred by Regulation No. 12(2) of the Employees' State Insurance Corporation (Staff and Conditions of Service) Regulations, 1959, the undersigned hereby delegates powers to Regional Directors/Director (Medical) Delhi/Administrative Officer-II to impose any of the penalties specified in clauses (i) to (ix) of Regulation 11 ibid on class III (excluding Insurance Inspectors/Managers Grade-II/Audit Inspectors and Personal Assistants) and class IV employees, in their respective regions/offices. In cases of Insurance Inspectors/Managers Grade-II/Audit Inspectors and Personal Assistants, the powers already delegated by the Director General vide office order No. 181 of 1974 dated 10.5.1974 to all regional Directors/Directors (Medical) Delhi/Administrative Officer II to impose only minor penalties as specified in clauses (1) to (iv) of Regulation 11 ibid shall be exercisable by them. Th....
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....was employed as Manager Gr. II. Disciplinary proceedings were initiated against him by the Regional Director on the basis of Memorandum dated July 18/25, 1986. The said respondent filed an application (Application No. 747 of 1987) before the Tribunal challenging the very initiation of said proceedings against him by the Regional Director. All the three petitions, namely, Application No. 1678 of 1986 and application No. 473 of 1987 filed by T. Abdul Razak and Application No 474 of 1987 filed by P.K. Philip have been disposed of by the Tribunal by the impugned judgment dated January 29, 1988 whereby the Tribunal has Struck down Rule 16(2) of the Rules in its entirety, the words "or the 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 Regulation. The resolution of the Standing Committee of the Corporation dated May 24, 1968 as well as orders dated May 10, 1974 and April 9, 1981 passed by the Director General have also been quashed. The Tribunal has also quashed the memorandum dated October 20, 1983, January 2....
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....s context, it may be mentioned that no order of the Director General delegating his powers regarding initiation of disciplinary proceedings under Regulation 13(1) had been placed before the Tribunal. The tow orders of the Director General dated may 10, 1974 and July 18, 1981, which were under challenge, had been passed under Regulation 12(2) whereby the Director General had delegated the power to impose minor penalties specified in clauses (1) to (i) of Regulation 11 in respect of certain categories of employees specified therein on the officers specified therein. Therefore. in so far as the validity of the memoranda regarding initiation of disciplinary proceedings against the respondents is concerned the question regarding delegation of powers by the Director General did not arise for consideration and the Tribunal was not required to deal with the question regarding validity of Rule 16(2), Regulations 12(2) and 13(1), the resolution of the Standing Committee dated May 24, 1968 and the orders of the Director General dated May 10, 1974 and April 9, 1981. With regard to initiation of disciplinary proceedings by the Regional Director, we find that the legal position is well settled t....
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....or authorities subordinate to the Corporation and there is no scope for such delegate to sub-delegate that power, by authorising any other officer to exercise or perform the powers so delegated. The Tribunal has, therefore rightly held that Section 94-A does not specifically provide that an officer or authority subordinate to the Corporation to whom the power the power has been delegated by the Corporation can, in his turn, authorise any other officer to exercise that power of function. But the question that arises is whether Rule 16(2) of the Rules and Regulations 12(2) and 13(1) of The Regulations relate to exercise of powers or functions of the Corporation or the Standing Committee delegated to the Director General by the Corporation or the Standing Committee under Section 94-A of the Act. In order to answer these question, it is necessary to make a distinction between a power conferred on the Director General under a rule made in exercise of rule making power under Section 95 or under a regulation made in exercise of power to make regulations under Sections 97(2)(xxi) and 17(2) of the Act and a power or function of the Corporation or the Standing Committee which is delegated to....
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....se of the powers conferred on him under Regulation 12(2). By the said orders the Director General delegated the powers to impose minor penalties specified in clauses (i) to (iv) of regulation 11 in respect of certain categories of employees and the officers specified in the said orders, Since the offending part of Regulation 12(2) has been found to be valid the said orders dated May 10, 1974 and April 9, 1981 must be held to have been validly issued in exercise of the power of delegation conferred on the Director General under Regulation 12(2). Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968 go together, under rule 16(2) the Director General has been empowered to delegate any of his powers or duties under the Rules or the Regulation or under any resolution of the Corporation or the Standing Committee, as the case may be, to any person subordinate to him, For the purpose of such delegation it is necessary for the Director General to obtain the approval of the Standing Committee. Resolution of the Standing Committee dated May 24, 1968 accords such approval to the Director General. The power of delegation under Rule 16(2) can be divided into two parts; on....