Administrative Action Cannot Be Struck Down Merely Because It Was Not Issued As A Formal Order : Supreme Court

The Supreme Court on Thursday (July 30) held that when an authority possesses a power under a relevant statute to take an action, the mere fact that the action is styled as a "circular" or "communication" rather than a formal "order" does not invalidate it.

“Once the power exists and it is clear that this particular power has been exercised, the style under which it was exercised would not denude or weaken the authority enabling it to exercise such power.”, observed a bench of Justice Sanjay Karol and Justice Augustine George Masih.

In this case, the Appellant, a district cooperative bank employee holding a technical post of Assistant Engineer, was promoted to the post of Additional Manager, following a circular issued by the Registrar deleting the Rule 5(3)(a) of the Chhattisgarh District Cooperative Central Bank Employee Service (Employment, Terms and their Working Conditions) Rules, 1982 that created a bar on the promotion of a technical post holder to the post of Additional Manager.

The Appellant, having worked for nearly thirteen years on the promoted post, was removed from the promotional post after a Writ Petition was filed challenging his promotion by a Respondent No.5, who held an administrative post, and was put below the Appellant in the gradation list.

The Single Bench of the High Court denied the Appellant's promotion to the post of an Additional Manager, because the Rule which bars the promotion of the technical post holder to the post of an Additional Manager was improperly deleted by the Registrar by merely issuing a circular, instead of bringing in an amendment to the Rule.

The Single Bench decision to quash the Appellant's promotion was upheld by the Division Bench, prompting him to appeal to the Supreme Court.

Setting aside the impugned decision, the judgment authored by Justice Karol held that the Registrar's decision to issue the circular could not be faulted. The Court observed that since the Registrar possessed the authority to remove the Rules that barred technical post holders, such as the appellant, from being promoted to the post of Additional Manager, the manner or form in which that power was exercised could not, by itself, be a ground to invalidate the action.

“…given the statutory power of the Registrar, the notification being termed as 'circular' or something else, would not affect the sanctity thereof.”, the Court observed.

Accordingly, the appeal was allowed.

“The necessary consequence of the conclusion recorded by us is that the appellant shall (a) be placed on the said position and status from which he was removed; (b) his seniority shall be protected; (c) entitled to all benefits of promotion that may have fallen due as per law; and (d) he shall also be entitled to 50% back wages payable within two months from the date of this judgment, failing which an interest @6% per annum shall be paid.”, the Court ordered.

Headnote

Chhattisgarh Ke Jila Sahkari Kendriya Bank Karmachari Seva (Niyojan, Nibandhan, Tatha Unki Karya Sthiti) Niyam, 1982 — Rule 5(3)(a) — Deletion of Rule — Power to Amend Statutory Rules — Effect of Non-Tabling of Rules Before Legislative Assembly — Executive Instructions vs Statutory Authority – Held - i. Power to Amend Rules — Applicability of Section 21 of General Clauses Act, 1897 - Chhattisgarh Cooperative Societies Act, 1960 — Section 55(1) The Registrar, Cooperative Societies, possesses the statutory power under Section 55(1) of the 1960 Act to frame rules governing the terms and conditions of employment in cooperative societies - Applying Section 21 of the General Clauses Act, 1897, the statutory authority conferred to frame rules inherently includes the power to amend, alter, vary, or rescind such rules - The deletion of Rule 5(3)(a) of the Niyam, 1982 by the Registrar was a valid exercise of statutory rule-making power and was not a mere executive instruction – ii. Nature of Laying Requirement — Mandatory vs. Directory - Chhattisgarh Cooperative Societies Act, 1960 — Section 95(3) Section 95(3) mandates that all rules made under the Act shall be laid before the Legislative Assembly - in the absence of any prescribed statutory consequences or penalty for non-laying, the provision is directory and not mandatory - Non-compliance with the laying procedure does not invalidate the rules or defeat the statutory exercise of power by the Registrar – iii. Exercise of Power — Nomenclature and Style of Order - Where a statutory power exists and is validly exercised, the style, nomenclature, or format of the notification (e.g., being styled as a "circular" or letter) does not denude or weaken the statutory authority enabling the act - A wrong reference or improper nomenclature does not vitiate the action if it can be justified under an existing power – iv. Setting Aside Promotion After Long Passage of Time - Where an employee continued to function on a promotional post for 13 years during the pendency of litigation, and the promotion was made pursuant to a valid exercise of statutory power, setting aside such promotion was erroneous - The appellant is entitled to restoration of status, protection of seniority, promotional benefits, and 50% back wages. [Relied on K.T. Plantation (P) Ltd. v. State of Karnataka, (2011) 9 SCC 1; State of M.P. v. Hukum Chand Mills Karamchari, (1996) 7 SCC 81; Kiran Devi v. Bihar State Sunni Wakf Board, (2021) 15 SCC 15; Paras 10-16]

Cause Title: S. P. CHANDRAKAR VERSUS STATE OF CHHATTISGARH & ORS

Citation : 2026 LiveLaw (SC) 743

Click here to download judgment

Appearance:

For Petitioner(s) :Mr. Padmesh Mishra, Adv. Mr. Shivam Shukla, Adv. Mr. Sameer Singh, Adv. Ms. Neelam Singh, AOR

For Respondent(s) :Ms. Ankita Sharma, AOR Mr. Bishwajit Dubey, A.A.G. Mr. Vinayak Sharma, Standing Counsel, Adv. Mr. Ravinder Kumar Yadav, AOR Mr. Yashvardhan Shah, Adv. Ms. Kritika Yadav, Adv. Mr. Dushyant Singh Chauhan, Adv. Mr. Utkarsh Singh, Adv. Mr. Vikrant Singh Bais, AOR Mr. Shubham Gupta, AOR Ms. Prerna Gupta, Adv. Mr. Praween Gupta, Adv.