Sunil Ambwani, J. - (1.) -The petitioner was appointed as a Class III employee in the U. P. State Handloom Corporation Limited (in short, the Corporation). In the year 1991 he was posted as Store Keeper at Kendriya Vastragar, Production Centre, Mallawan, District Hardoi. A charge sheet dated 11.1.1995 was served upon him ; imputing charges, of financial irregularities, and alleging that in the year 1991-92 a quantity of goods, namely 9550, pairs of cloths which were transported from the Godown, to the M/s Govind Calendering Company were not duly received by the Calendering Company, and that the receipt submitted by petitioner was forged document, causing a loss of Rs. 5,42,925 to the Corporation. The then Managing Director of the Corporation placed him under suspension. The disciplinary enquiry was concluded with the finding that petitioner was guilty of causing financial loss of Rs. 4.43 lacs to the Corporation in collusion with the proprietor of the calendering plant.
(2.) A second show cause notice dated 17.8.1998 was served upon petitioner, proposing to impose major penalty. Petitioner submitted his reply dated 5.2.2001 enclosing therewith chalans/bills of the goods, which were duly received at the head office under the receipt, and requested to be exonerated. The Managing Director of the Corporation by his order dated 1.12.2001 did not accept petitioner's explanation and directed the petitioner to be dismissed from service. The petitioner preferred a departmental appeal under Rules 68.18 of the Service Rules applicable to the employees of the Corporation. The Chairman/Appellate Authority by his order dated 18.3.2002 allowed the appeal. The Chairman found that the goods were transported by a recognised transporter. The calendering company had acknowledged the receipt of the goods. Subsequently the calendering company wrote a letter dated 28.3.1994 denying receipt of goods and claimed that the receipts issued by the calendering company were forged. The owner/proprietor or any person from the calendering company did not appear during the enquiry proceedings. A number of dates were fixed but no one from the calendering company came to prove the letter dated 28.3.1994, and that there was no material brought on record to prove complicity between petitioner and the calendering company. The Chairman found that charges were not established and that the petitioner had not received any benefit either directly or indirectly and had no intention to cause loss to the Corporation. The appellate authority directed the petitioner to be reinstated with all consequential service benefits. The Managing Director of the Corporation refused to implement the Appellate Order on the ground that by the Government Order No. 11958/ 18301, dated 3.5.2001, the Chairman was stripped of the appellate powers. The petitioner has prayed for quashing the order dated 23.4.2002, passed by the Managing Director and for reinstating petitioner in service with all consequential benefits.
(3.) I have heard Sri H. R. Misra for petitioner and Sri Shiv Nath Singh for respondent corporation. Counsel for the petitioner submits that under Rule 68.18 a departmental appeal lies to the authority next higher in rank to the original authority. The authority next higher to the Managing Director, is the Board of Directors. By resolution No. 109.4 in the 109th meeting of the Board of Directors of the Corporation dated 30.6.1997, the Board had vide resolution No. 108.13, authorised/ delegated the power to the Chairman, for disposal of appeals filed by the delinquent employees against the punishment imposed by the Managing Director to the Chairman of the Corporation. The State Government does not have the power or authority to cancel the resolutions of the Board of Directors of the Corporation. The Corporation is registered as Company under the Companies Act, 1956 and its business is regulated by the Memorandum and Articles of Association. Under the service Rules, the authority next higher in rank to the Managing Director is the Board of Directors and that the Board can authorise any officer, not lower than the Managing Director to decide the appeals. The Board of Directors had not authorised any officer who was so indicated in the service rules to decide the appeals. In any case the Government Order provided to cancel all the authorisations where the authority other than the authority indicated in the rules was authorised by the Board of Directors to decide the matters. In the alternative, Sri Misra submits that the Board had adopted, the order of the State Government that the Articles to reconsider the same, on 17.7.2002. By that time the appeal was allowed and thus the resolution of the Board of Directors dated 17.7.2002 will not make the appellate order in operative or without jurisdiction. His last submission is that in any case, the Board was required to reconsider the appeal or to rectify the decision of the Chairman and that the appellate order cannot be made inoperative by the disciplinary authority.;