State Expected To Adhere To Rule Of Law: Kerala High Court Quashes Appointment Of Marketfed MD

The Kerala High Court on Thursday quashed the appointment of S. K Sanil as the Managing Director of MARKETFED (Kerala State Co-operative Marketing Federation Limited). 

A Division Bench consisting of Justice A. K. Jayashankaran Nambiar and Justice Mohammed Nias C.P. found Sanil to be ineligible and unqualified to hold the post, citing that he was not an officer in the IAS cadre in the senior time-scale at the relevant point in time.

"The State Executive is expected to adhere to the rule of law and set an example in matters of statutory compliance by adhering to its Constitutional role as a 'State' within the meaning of the term under Article 12 of the Constitution of India...we caution the State and the MARKETFED against resorting to such exercises in future."

The Writ Appeal was moved by a member of the South Wayanad Co-operative Rubber and Agricultural Marketing Society, which is affiliated to MARKETFED. It was submitted in the petition that the MD has to be appointed by the Board of Directors in consultation with the State Government and in compliance with the Subsidiary Rules and Service Regulation of MARKETFED. 

In the Writ Appeal, the appellant challenged the government order appointing Sanil as the MD, without abiding by the provisions of the Subsidiary Rules and Service Regulations of MARKETFED and the provisions of the bye-laws.

Through a communication issued in February 2018 by the Private Secretary to the Minister for Co-operation, Tourism and Devaswom addressed to the Special Secretary, Department of Co-operation, Government of Kerala, the Minister concerned had instructed to appoint Sanil as the MD. 

In the statement filed on behalf of the State Government, it was pointed out that although the bye-laws contemplated that the appointment of the MD had to be done by the Board of Directors, based on the practice hitherto followed in the MARKETFED, the nomination of the MD was done by the Government, and the said nomination was ratified by the Board of Directors. Therefore, it was contended that even if there was an irregularity in the method of appointment, the same stood regularised through the ratification done by the Board of Directors.

The Court, however, rejected this contention and observed that Sanil's appointment was contrary to the bye-laws and the Service Rules and, to that extent, an illegal one that could not be regularised through mere ratification by the Board of Directors.

In the instant case, it is pointed out that the appointment of the 4th respondent was contrary to the bye-laws and the Service Rules, and to that extent, an illegal one that could not be regularised through a mere ratification by the Board of Directors.

The Court thereby allowed the Writ Appeal and quashed the appointment. 

However, the Court taking note of the fact that Sanil had occupied the past for the last four years and many policy decisions might have been taken at his instance, found it appropriate not to nullify any action taken by him in his capacity as the MARKETFED MD.

Case Title: A. Krishnan v. The Kerala State Co-operative Marking Federation Ltd 

Citation: 2022 LiveLaw(Ker) 469

Click Here To Read/Download The Order