C.S. Dharmadhikari, J.
1. Since all these writ petitioners involve common questions of law and facts they were heard together and are being dispose of by this common judgment.
2. Petitioners in all these writ petitions were dismissed from service with effect from 1st of June, 1982 by the Bombay Agricultural Produce Market Committee, Bombay. In the letter of dismissal dated 29th of May, 1982 it is alleged that the petitioners were instigating and inciting employees to go on illegal strike which had been commenced on and from 13-6-1982. That they were also on illegal strike and have been coercing employees with grave and serious consequences and thus preventing and/or obstructing them from coming back to work. It was then stated that the Agricultural Produce Market Committee was unable to hold enquires, as the situation was very tense, and witnesses were not willing to come forward to give evidence. These orders of dismissal were issued under Clause (b) of proviso to Rule 103 of the Maharashtra Agricultural Produce Marketing (Regulation) Rules, 1967. It is these orders of dismissal which are challenged in these writ petitions on various grounds.
3. Dr. Kulkarni, the learned Counsel appearing for the petitioners contended before us that Rules 101, 102, 103 and 104 of the Rules, which deal with discharge, penalties or the dismissal, removal or reduction of the employees are ultra vires being beyond the scope of rule-making power conferred on the State Government under section 35 or 60 of the Maharashtra Agricultural Produce Marketing (Regulation) Act, 1963 (hereinafter called as the said Rules or the Act as the case may be). He then contended that the rules are also ultra vires since they are in breach of the principles of natural justice which is a part and parcel of Articles 14 and 16 of the Constitution of India. According to Dr. Kulkarni since Clause (b) of proviso to Rule 103 confers an arbitrary and unbridled power upon the Market Committee to dismiss or remove an employee without following the principles of natural justice the said rule is wholly arbitrary and is, therefore, ultra vires and Articles 14 and 16 of the Constitution of India. He also contended that the said rules are not applicable to the petitioners since the petitioners who are workmen, are governed by the Model Standing Orders framed under the Industrial Employment (Standing Orders) Act, 1946. According to the Counsel by virtue of section 38(b) read with entry 79 (g) in Schedule II to the Bombay Shops and Establishment Act, the provisions of the Industrial Employment (Standing Orders) Act, 1946 in its application to State of Maharashtra apply to the Market Committee also as if it is an Industrial Establishment within the meaning of Industrial Employment (Standing Orders) Act. He also brought to our notice that the Market Committee is duly registered under the Shops and Establishment Act and is therefore deemed to be an Industrial Establishment within the meaning of the said Act. Dr. Kulkarni then contended that even on merits, orders of dismissal are bad in law as the alleged reasons recorded by the Market Committee for dispensing with the enquiry are no reasons in law and, therefore, on that count also the orders of dismissal are liable to be set aside.
4. On the other hand it is contended by Shri Singhavi the learned Counsel appearing for the respondents Market Committee that the power conferred upon the Market Committee to appoint officers and other servants must carry with it the power to remove them. According to him the provisions of section 35 of the Act will have to be read with section 16 of the General Clauses Act. If so read sub-section (3) of section 35 read with section 60 of the Act concerns a power upon the State Government to frame rules for the employment of staff as well as for its removal. Shri Singhavi then contended that it is not correct to say that any unguided or unbridled power has been conferred upon the Market Committee to dispense with the enquiry, under Clause (b) of proviso to Rule 103 of the rules. By Rule 103 a procedure for passing an order of dismissal removal or reduction is laid down and then comes proviso (b) to Rule 103, which is akin to Article 311(2)(b) of the Constitution of India. If the provisions of Article 311(2)(b) of the Constitution of India are reasonable and good then for the same reasons Clause (b) of proviso to Rule 103 is also good in law. He also contended that the said provision does not confer any arbitrary or unbridled power upon the Market Committee but in terms the said clause lays down that before passing such an order, the Market Committee is to be satisfied for the reasons to be recorded in writing that it is not reasonably practicable to hold such inquiry. The requirements of recording the reasons in writing is in tune with the principles of natural justice. Further such a decision is made final subject to the decision of the Director in appeal. The provision regarding appeal against the decision of Market Committee provides sufficient check or safeguard in that behalf. Further the requisite guidelines are inherent in the said rule. Power under the proviso can be exercised in only those cases where the Market Committee is satisfied that it is not reasonably practicable to hold inquiry and that too after recording reasons in writing in support of such a decision. Further an appeal lies to the Director against the said decision.
5. So far as the applicability of the standing orders are concerned, it is contended by Shri Singhavi that the Bombay Shops and Establishments Act is not applicable to the Market Committee though it wrongly appears that it is wrongly registered under the Bombay Shops and Establishment Act. According to Shri Singhavi, only because the Market Committee is registered under the Bombay Shops and Establishment Act it is not estopped from contending that the provisions of the Act are not applicable to it since there is no estoppel qua the provisions of the law. According to him the Market Committee is neither an establishment nor a commercial establishment within the meaning of the Bombay Shops and Establishment Act. It was then contended by Shri Singhavi that assuming that the Act applies and, therefore, the standing Orders also apply to the Market Committee then also in view of the provisions of Clause 30 of the Standing Orders, nothing contained in the Standing Orders can operate in derogation of any law for the time being in force and the rules framed under the Act is a law within the meaning of the said clause. Therefore, even if it is assumed that the standing orders apply to the Market Committee still by virtue of Clause 30 of the standing orders the rules framed under the Marketing Act alone, will govern the conditions of service so far as the employees of the Market Committee are concerned.
6. So far as the contention raised by Dr. Kulkarni i.e. State Government has no power to frame rules providing for disciplinary action and consequent termination or removal of the employees is concerned, in our view the said contention will have to be rejected. Section 35 of the Maharashtra Agricultural Produce Marketing (Regulation) Act, 1983 reads as under :
'35(1) A Market Committee may employee a secretary and such other officers and servants as may be necessary for the management of the market, for the collection, maintenance, dissemination and supply of information relating to crops, statistics and marketing intelligence and for carrying out its duties under the Act; and shall pay such officers and servants such salaries as the Market Committee thinks fit.
(2) The Market Committee may in the case of its employees provide for the payment of them all such leave allowance, pension or gratuity as it deems proper and may contribute to any provident fund which may be established for the benefit of such employees.
(3) The powers conferred by this section on the Market Committee shall be exercised subject to any rules which may be made in that behalf by the State Government.'
From the bare reading of sub-rule (3) of section 35 it is quite clear that the power conferred upon the Market Committee is made subject to the rules which may be made in that behalf by the State Government. By sub-section (1) of section 35 a power is conferred upon the Market Committee to employ staff. If the power to appoint employees is read with section 16 of General Clauses Act, then the power to make appointment must include power to suspend or dismiss any person appointed in exercise of the said power. Then comes section 60 which confers a power upon the State Government to frame rules. Sub-section (1) of section 60 lays down that the State Government may by notification in the Official Gazette make rules for carrying into effect the purpose of the Act. Then by sub-section (2) of section 60 in particular, but without prejudice to the generality of the foregoing provision, the State Government is empowered to make rules under clauses (a) and (b). It is by now well-settled that the specific provisions such as are contained in the several clauses of section 60(2) are merely illustrative and they cannot be read as restrictive of the generality of powers prescribed by section 60(1). If the powers specified by section 60 (1) are very wide and they take within their scope and ambit the rules like the one impugned, then it cannot be said that the powers enumerated under section 60(2) control the general words used in section 60(1). See Afzal Ullah v. State of Uttar Pradesh and another, : 4SCR991 . The State Government has general power to make rules for carrying into effect the purposes of the Act. Clause (h) of section 60(2) is merely illustrative and not restrictive of the general power. If by section 35 a power is conferred upon the Market Committee to employ staff and the said power if read with Clause 16 of the General Clauses Act, include the power to suspend, remove or dismiss an employee, then under section 35(3) read with section 60 of the Act, the State Government has a power to frame rules in the matter of employment of staff as well as its removal etc.. It is by now firmly established that the power to terminate the services is a necessary adjunct of the power to appoint and is exercised as an incident to or consequence of that power. It flows naturally as a necessary sequence from power to appoint. In other words it is a necessary adjunct of the power of appointment and is exercised as incident to, or consequence of that power. Under section 35 of the Act, Market Committee is empowered to employ officers and servants as maybe necessary for management of the Market Committee etc. that is for carrying out its duties under the Act. It can also make provision for payment of salaries, pension, gratuity, provident fund, etc. Thus by section 35, an administrative set-up has been planned. The proper performance of the functions and duties by the staff is a part and parcel of the scheme of the Act. The pension, or gratuity can become payable only after retirement or termination. The power conferred by this section can be exercised by the Market Committee subject to the rules which maybe made by the State Government. If the State Government can frame rules for payment of pension or gratuity, it has an implied power to make rules in the matter of retirement as well as termination of employees. Power to suspend and reduce in rank is included in the power to employ and remove. Therefore, laying down procedure for taking disciplinary action and for passing ultimate order of removal or dismissal is part and parcel of the scheme of Chapter V i.e. section 35 of the Act and the State Government has power to frame rules in that behalf under section 80(1) of the Act, for carrying into effect said scheme or purpose. These rules are not framed under section 16 of the General Clauses Act, but are framed under section 60 read with section 35 of the Act. If the employment of the staff is necessary for carrying in to effect the purposes of the Act, then by necessary implication the power to suspend or remove the staff is apart of said purpose. To hold that the State Government has power only to frame rules regarding the employment of staff and has no power to frame rules, providing for the disciplinary action, or the suspension, removal or dismissal of the staff, will be negation of that power. Therefore, power to frame rules for suspension, reduction or removal of the staff is implied in the power conferred by section 35(3) and section 60 of the Act. Therefore, it cannot be said that the rules framed by the State Government in that behalf are in any way ultra vires being beyond the scope of rules making power.
7. So far as the second contention raised by Dr. Kulkarni is concerned, i.e. that the rules are ultra vires of Articles 14 and 16 of the Constitution of India, the said challenge also must fail. It cannot be forgotten that we are dealing with a statutory body i.e. the Bombay Agricultural Produce Market Committee. It is no doubt true that Article 311 of the Constitution of India in terms does not apply to the persons in service of such statutory body or local authority. But the principles underlying Article 311 would apply to employees working in such public body. Such a view has been taken by this Court in Ramkrishna v. Municipal Commissioner, Nagpur Municipal Corporation, Special Civil Application No. 33 of 1960 decided on 9th of July 1960 reported in 1960 Nagpur Law Journal Note 84 and the cases referred to therein. Such a view is also taken by the Supreme Court in Town Area Committee v. Jagdish Prasad A.I.R. 1978 S.C. 1407. However we must make it abundantly clear that we are scrutinising this challenge in the context of a statutory body and do not propose to lay down any general rule or principle in that behalf. Further Clause (b) of proviso to Rule 103 of the rules cannot be read in isolation. It will have to be read and considered harmoniously together with the other rules. Rule 100 deals with the employment of certain officers and servants to the Market Committee. Sub-rule (6) of Rule 100 then lays down that no person in the service of a Market Committee shall be suspended for a period exceeding one month without the previous approval of the Director or any officer specially authorised by him in this behalf. Other clauses of rule 100 deal with other conditions of service like pay scale etc. Then by Rule 101 a procedure for resignation and discharge of officers and servants is laid down. Rule 102 deals with the penalties which may for good and sufficient reasons be imposed upon any officer or servant of the Market Committee. Then comes Rule 103 which reads as under:
'103. Order of dismissal, removal or reduction; (1) No person who is in the service of a Market Committee shall be dismissed removed or reduced in rank except by an order made in that behalf, and except after an inquiry in which he has been informed in writing of the charges against him and opportunity of being heard in respect of those charges is given, and where it is proposed, after such inquiry to impose on him any such penalty until he has been given a reasonable opportunity of making representation on the penalty proposed, but only on the evidence adduced during such inquiry, and resolution recommending the penalty proposed has been passed by the Market Committee by two-thirds majority of the members of the Market Committee.
Provided that, this rule shall not apply ;
(a) where a person is dismissed or removed or reduced in rank on the ground of conduct which has led to his conviction on criminal charge ; or
(b) where the Market Committee is satisfied, for reasons to be recorded in writing that it is not reasonably practicable to hold such inquiry.
(2) If in respect of any such person as aforesaid, a question arises whether it is reasonably practicable to hold such inquiry as is referred to in sub-rule (1) the decision of the Market Committee subject to the decision of the Director in appeal, shall be final.'
By rule 104 on appeal is provided against the order imposing any of the penalties referred to in rule 103. Initially such an appeal lies to the Director and any person aggrieved by the order of the Director can file further appeal to the State Government. By the impugned clause i.e. Clause (b) of proviso to section 103 a duty is cast upon the competent authority to record reasons in writing for its satisfaction. The decision of the Market Committee to dispense with the inquiry is also made subject to an appeal to the Director. Rule requiring reasons to be recorded in writing that it is not reasonably practicable to hold such an inquiry is like 'audi alteram partem', a basic principle of natural justice which must be observed in its proper spirit and mere pretence with the compliance with it would not satisfy the requirement of law. This is the reason why the decision of the Market Committee is made appealable. The Appellate Authority is also expected to scrutinise the whole matter objectively and then come to an independent conclusion in that behalf. Further the reasons recorded will have to be tested objectively. This is the reason why an appeal is provided against the said decision. The right of appeal is not a right without substance. When one authority sits in appeal over the decision of another authority, there is always a change that Appellate Authority might take a different view of the facts or of law. In legal parlance appeal means the judicial examination of the decision by the higher Court or authority of an inferior Court or authority. In essence and pith it amounts to a complaint to the higher forum that the decision of the subordinate Tribunal is erroneous and, is therefore, liable to be rectified or set aside. Thus litigant-employee is entitled to a full, fair and objective consideration of the whole question at the appellate stage also.; To say the least the Appellate Authority cannot act mechanically as a mere rubber stamp. At the appellate stage employee is entitled to a fair and proper hearing and after giving a reasonable opportunity of being heard, the Appellate Authority is expected to pass a reasoned order. This is more so, since an appeal lies against the decision of the Director to the State Government. Though a discretion is conferred upon the Market Committee to dispense with an inquiry, such a discretion will have to be exercised in accordance with the reason and fair play and not capriciously. Bereft of rationality and fairness discretion degenerates into arbitrariness which is the very antithesis of the rule of law. The reasons which are to be recorded in writing for arriving at a satisfaction, that it is not reasonably practicable to hold inquiry, will have to be such which have nexus with the object. The guidance is writ large in the very provision. The underlined policy is apparent on the face of it though its applicability must obviously depend upon the facts and circumstances of each case. Thus for deciding the question whether it is reasonably practicable to hold an inquiry each and every case will have to be scrutinised independently and no collective or omnibus decision can be taken in that behalf. Uniform or set recital of a formula like ritual or a Mantra might indicate mechanical approach or non application of mind. Further while taking a decision in that behalf, the competent authority will have to take into consideration other provisions of the rules, including the one which confers a power upon the Market Committee to suspend an employee. Even if an urgent and immediate actions called for, recourse cannot straightaway be taken to proviso (b) of rule 103 if such a purpose could be achieved by ordering suspension of the employee under Rule 100(6). The words 'reasonably practicable' are used in context of holding of an inquiry, and they cannot be correlated or confused with the merits of the charge. It cannot also be forgotten, that such an order is also open to challenge before the competent Court of law. In that case the Court is entitled to enquire whether conditions precedent to the formation of such satisfaction have any factual basis. Secondly, whether the authorities have acted in good faith and thirdly, whether the relevant material upon which such a decision could be validity based did exist. Though the proviso (b) to Rule 103 is pari materia to proviso (b) to Article 311(2) of the Constitution of India, the employment with the Market Committee cannot be equated with the employment with the Government. Their rigour and conditions of employment are not the same. Following the procedure of inquiry as laid down by Rule 103 is a formality and recourse could be taken to proviso (b) to Rule 103 in very exceptional and rare cases. The matter in this behalf, does not rest solely on the subjective satisfaction of the Market Committee, but this discretion can be exercised on the basis of objective facts which are again justifiable. The decision of Market Committee is also made appealable, and appeals to an independent high ranking authority namely, the Director. It is needless to say that once the Appellate Authority comes to the conclusion that discretion was not properly exercised, that will be the end of the matter as on that short ground alone the order of dismissal or removal is liable to be set aside. Therefore, it cannot be said that any arbitrary, unguided or unbridled power has been conferred upon the Market Committee to dispense with the inquiry.
8. So far as the third contention i.e. the provisions of the Industrial Employment Standing Orders Act, apply to the Market Committee and therefore, will have an overriding effect is concerned, we do not propose to decide the said contention in the present writ petitions. It is seriously contended by Shri Singhavi that the provisions of the Industrial Employment Standing Orders Act are not applicable to the Market Committee. According to Shri Singhavi the provisions of the Bombay Shops and Establishments Act, 1948 are not applicable to the Market Committee since the Market Committee is neither an establishment nor a commercial establishment within the meaning of the said Act. He also contended that the market Committee was wrongly registered under the Bombay Shops and Establishments Act. Even otherwise in entry 79 in Schedule II, of the Act a reference is made to the officers of the Agricultural Produce Market Committee only and the said entry will not take in its import, other activities or departments of the Committee. The Market Committee is also not bound by any admission or representation on the point of law, nor is it precluded or estopped from asserting that the Shops and Establishment Act is not applicable to it.
9. In the alternative it was contended by Shri Singhavi that assuming that the Industrial Employment (Standing Orders) Act and the Bombay Industrial Employment (Standing Orders) Rules together with Modern Standing Orders apply to the Market Committee, still in view of the provisions of Clause 30 of the Standing Orders, nothing contained in the Standing Orders can operate in derogation of any law for the time being in force and rules framed under the Maharashtra Agricultural Produce Marketing (Regulation) Act is such a law within the meaning of the said clause. Therefore, according to Shri Singhavi in view of Clause 30 of the said Standing Orders, the rules framed under the Marketing Committee Regulation Act shall prevail and will govern the conditions of service of the employees working in the Market Committee.
10. On the other hand it is contended by Dr. Kulkarni that the Market Committee has been rightly registered under the Bombay Shops and Establishments Act. If the provisions of Chapter IV of the Act dealing with the powers and duties of the Market Committee are considered in its proper perspective, it can safely be said that the Market Committee is an establishment to which Bombay Shops and Establishments Act applies. This position is further made clear by the entry 79(g) of Schedule II of the Bombay Shops and Establishment act which deals with exemption from the provisions of the Act. Unless an establishment is covered by the Act the question of exemption will not arise. Therefore, entry 79 in schedule II is indicative of the intention of the legislature. Dr. Kulkarni also contended that submission made by Shri Singhavi on the basis of Clause 30 of the Standing Orders is also based on misreading of the provision. According to Mr. Kulkarni the provisions of law which are more favourable to the employees alone are saved by Clause 30 of the Standing Order. The word 'derogation' means to lessen by taking away. Therefore, the correct interpretation of Clause 30 will be nothing contained in the Standing Orders shall take away the right conferred upon the employee by any other law for the time being in force if the same is more favourable to the employee, which means that the Standing Orders will not operate to the prejudice of the employees. This intention is further clear from the use of word 'prejudice' in the later part of Clause 30. This position is also made clear by section 2(A)(2) of the Industrial Employment (Standing Orders) Act. According to Dr. Kulkarni Clause (b) of proviso to rule 103 of the rules being less favourable and prejudicial, the Standing Orders shall prevail over and above the said clause. In support of this contention Dr. Kulkarni has placed reliance upon the decision of the Supreme Court in A.I.R. 1979 S.C. State Electricity Board v. Hari Shankar Jain and : (1981)ILLJ1SC Life Insurance Corporation of India v. D.J. Bahadur. As already observed we do not propose to decide this contention finally in the present petitions since the factual position itself is disputed by the Market Committee. As to whether the Bombay Shops and Establishments Act will apply to the Market Committee or not is in any case a mixed question of law and fact which cannot be gone into and decided finally in the present writ petitions. In the absence of cogent and sufficient materials on record, it will not be fair to decide this dispute question in the present petitions. Deciding such question or contention on the basis of an assumption is an exercise in futility and therefore, the said question is left open.
11. It was then contended by Dr. Kulkarni that even on merits the order passed is illegal. According to Dr. Kulkarni the reasons given in the order of dispensing with the inquiry i.e. the Market Committee is unable to hold inquiry as the situation was very tense and the witnesses were not willing to come forward to give evidence, are no reasons in law, on the basis of which the inquiry could be dispensed with He then contended that only because immediate action against the employees responsible for the various activities referred to in the resolution of the Staff Committee could not have been recourse to proviso (b) of rule 103 because that purpose could have been achieved by suspending the employees under Rule 100(6) of the Rules. In support of his contention Dr. Kulkarni has placed strong reliance upon the Division Bench decision of this Court in Mohamed v. Union of India and others 1977 L I C 1590, a decision of the Full Bench of Allahabad High Court in 1981 Labour and Industrial Cases 881 Maksudan Pathak v. Security Officer Eastern Railway and the decision of the Supreme Court in 1963 (II) L.L.J. 111 Calcutta Dock Labour Board and other v. Jaffar Imam and others, and : 2SCR533 , Swadeshi Cotton Mills etc. v. Union of India, etc. However, it is not necessary to deal with this aspect of the matter any further since a statement is made by Shri Singhavi that he will advise the Market Committee to hold proper departmental enquiry in the cases of all the petitioners.
12. We are informed by Shri Singhavi that the enquiry officer is already appointed and the enquiry will be completed preferably within a period of one month from today. In view of this statement no further orders are necessary on merits of the matter at this stage. Liberty to the petitioners to file fresh petitions if necessary. Hence rule discharged.
13. However in the circumstances of the case there will be no orders as to costs.