RAJAN ROY, J. - (1.) Heard.
(2.) All these three writ petitions have been filed by the same petitioner, namely, Sri Chandra Pal, who on the date of filing of the first two writ petitions was in the employment of the U.P. Backward Classes Finance and Development Corporation Ltd., a Government company incorporated with the Companies Act, 1956. Prior to the filing of these three writ petitions, the petitioner had filed Writ Petition No.20638 (SS) of 2016, which was disposed of on 01.09.2016, as corrected on 05.09.2016, in the following terms:- "(C.M. Application No. 86902 of 2016) This is an application seeking correction in the order dated 01.09.2016 passed by this Court. Application is allowed. The order dated 01.09.2016 is corrected accordingly. Office is directed to correct the certified copy of the order or issue fresh copy of the order incorporating the corrections made therein. "
(3.) At this juncture, it is relevant to mention that prior to filing of this writ petition, a G.O dated 20.12.2011 had been issued by the State Government, based on a Cabinet decision regarding enhancement of age of superannuation of employees under the purview of the Bureau of Public Enterprises of the Government, from 58 to 60 years. The said Government order reads as under:- ...[VARNACULAR TEXT OMITTED]... 5. In pursuance of the aforesaid, the decision of the Board of Directors was communicated to the State Government vide letter dated 16.04.2012, but, thereafter, the matter remained pending before the State Government. 6. As the petitioner was due to retire from service of the Corporation on 31.12.2016, therefore, a notice of retirement dated 18.10.2016 was issued to him. As he had reached the fag end of his service without a decision being taken by the State Government regarding enhancement of age of superannuation/retirement, that too, in spite of a decision already having been taken by the Board of Directors for such enhancement vide Resolution dated 28.03.2012, the petitioner, in these compelling circumstances, by means of 24968 (SS) of 2016 challenged the notice of retirement and seeking a writ of mandamus to the State Government for taking final decision on the proposal submitted by the Corporation, as had been ordered by the High Court in its earlier writ petition vide order dated 01.09.2016 read with 05.09.2016 and allow the petitioner to continue till attaining the age of 60 years. When this writ petition was heard on 26.10.2016, the following order was passed:- "Instruction dated 26.10.2016 filed on behalf of the State is taken on record. Heard learned counsel for the parties. This Court on 20.10.2016 had passed the following order:- "Heard learned counsel for the parties. The petitioner herein is due to retire on 31.10.2016. He has earlier approached this Court by means of Writ Petition No. 20638(S/S) of 2016 for a decision by the State Government on the proposal of the Board of Directors of the Corporation dated 28.03.2012 for enhancement of the age of superannuation of its employee from 58 to 60 whereupon the following order was passed:- "Heard learned counsel for the petitioner, learned Standing Counsel representing the State-respondent and Sri Chandra Shekher, learned counsel representing the U.P. Backward Class Finance and Development Corporation Ltd. The petitioner, who is the employee of U.P. Financial Corporation has raised his grievance relating to enhancement of age of superannuation. The Board of Directors of the said Corporation in its meeting held on 28.03.2012 had already resolved to enhance the age of superannuation of the employees of the Corporation. Perusal of Ananexure No.7 annexed to the writ petition reveals that Managing Director of the Corporation has already written a letter to the State Government on 21.03.2014 for taking appropriate decision for enhancement of age of superannuation of the employees of the Corporation from 58 to 60 years. Accordingly, without entering into the merits of the case, this writ petition is finally disposed of with the direction to the State Government to take a final decision in the matter of the petitioner expeditiously, say, with a period of three months from the date of production of certified copy of this order." It is said that in spite of the said order till date no decision has been taken by the State Government though the resolution of the Board of Directors is dated 28.03.2012 and a reminder was sent on 21.03.2014 and thereafter the order of this Court was passed on 01.09.2016 i.e. almost one and half month ago, therefore, irreparable cause would be to the petitioner, if such decision is not taken prior to his retirement. This Court finds that a uniform standard is not being adopted by the State Government in the matter of decision based on the proposal sent by the Corporations for enhancement of age of superannuation in pursuance to its Government Order dated 20.12.2011. In some Corporations the age has been enhanced overnight while in others the matters are kept pending. The petitioner has also annexed a list of such Corporations where the age has been enhanced but in the case of the petitioner's Corporation, for the reasons best known to it, the Government is sitting over the matter. This is not a happy state of affairs. The State should function as a model employer and takes its decision promptly, as, in the event of such decision not being taken within time several employees are deprived of the benefit of enhanced age of superannuation as such decisions are normally rest not made applicable retrospectively. Put up on Tuesday i.e. 25.10.2016. Let the learned Standing Counsel seek instructions in this regard. It is expected that a positive response would come on the said date." The aforesaid order was passed for the reason that in several cases petitioner had approached the Court within time seeking a decision by the State Government on the proposal of the Corporation for enhancement of age but on account of no decision having been taken they retired. Subsequent to their retirement and during the pendency of the writ petitions the decisions were taken in some matters enhancing the age of superannuation but as the said decision was not retrospective, therefore, the benefit was not made available to those who had approached the Court within time thereby causing irreparable financial loss to them as also lost of status. Today, Shri K.K. Shukla, learned Standing Counsel informed the Court that the Government, after the passing of the aforesaid order, has taken a decision to enhance the age of superannuation of the employees of the respondent-Corporation from 58 to 60 in the meeting held on 25.10.2016 and has sent the proposal to the Departmental Minister for his approval. This would take some time. In the meantime, the petitioner is to attain the age of superannuation on 31.10.2016 but in view of the holidays in the Government office w.e.f 28.10.2016 he would be treated as superannuated from 28.10.2016 i.e. day after tomorrow, therefore, in these extraordinarily peculiar circumstances in order to protect the rights of the petitioner and also protect the petition itself from becoming infructuous, it is expected that the requisite decision shall be taken by tomorrow failing which it is provided that the petitioner shall be treated as continuing in service under the orders of this Court but shall not be paid salary till the next date of listing. It is not out of place to mention that the proposal was sent by the respondent-Corporation to the State Government way back on 16.04.2012 and thereafter a reminder was also sent in the year 2014 but the State Government kept sitting over the matter with folded hands. It is because of this extraordinarily peculiar circumstances which have arisen that this order is being passed by the Court. List this case on 07.11.2016 as first case of the day to enable the Standing Counsel to place before the Court the final decision of the State. This order by itself shall not confer any benefit upon the petitioner to salary etc. unless a favourable decision is ultimately taken. Let the copy of this order be provided to the learned counsel for the parties itself today, on payment of usual charges." 7. On a perusal of the said order, it is revealed that a statement was made on behalf of the State Government that after passing of the order in the earlier writ petition, State Government had taken a decision to enhance the age of superannuation of the employees of the respondent-Corporation from 58 to 60 years in the meeting held on 25.10.2016 and had sent a proposal to the departmental Minister for his approval, which would take some time. 8. Considering the aforesaid situation, where the petitioner was due to retire after five days, the Court passed the aforesaid order allowing him to continue but without salary and any other benefit so as to facilitate his continuance as soon as the requisite decision is taken. 9. At this stage, it must be mentioned that the decision taken in the meeting dated 25.10.2016 was at the level of the Principal Secretary and the approval of the Minister was still to be granted, therefore, sensu stricto, it was not the decision of the State Government. Nevertheless, the aforesaid order was passed in the extraordinary peculiar circumstances before the Court with the clear stipulation that the order shall not confer any benefit upon the petitioner to salary etc. unless a favourable decision is ultimately taken. Be that as it may, when the file went to the Departmental Minister with the noting of the Principal Secretary dated 25.10.2016 after considering the noting placed before him by the Joint Secretary, Backward Class Welfare Department, Government of U.P., the Minister opined as under:- ...[VARNACULAR TEXT OMITTED]... 10. In pursuance to the aforesaid decision of the Departmental Minister dated 26.10.2016, the matter was again placed before the Board of Directors of the respondent-Corporation, which in its meeting dated 04.11.2016 reiterated its earlier resolve. ...[VARNACULAR TEXT OMITTED]... 11. At this stage, it is not out of place to mention that in earlier Resolution dated 28.03.2012, as also in this Resolution dated 04.11.2016 which had been passed in terms of G.O dated 20.12.2011, the basis of passing the same was the financial capacity of the Corporation to shoulder the financial burden of enhancement of age of superannuation and in fact as is evident from the notings of the original file which has been produced before the Court today as also from other documents on record including the counter affidavit, there were only four regular employees in the Corporation and the petitioner was the first one to approach the ensuing retirement on 31.12.2016. The other three would attain the age of superannuation and retire some time in the year 2024. The original file which has been placed before me as also the other material on record categorically states that total financial burden of Rs.4.44 lakhs alone would accrue on account of such enhancement of age of all the four employees. Of course, this did not take into account any future revision of pay scale. As far as the petitioner is concerned, this revision of pay scale was not relevant and, therefore, his retirement would entailed a lesser financial burden. It is categorically mentioned that the Corporation had the financial capacity to shoulder the financial burden as aforesaid. Thus, the Board reiterated its decision in terms of the decision of the Government dated 26.12.2016. 12. Thereafter, the matter was to be again placed before the Department Minister. In the meantime, the proceedings before the Court in these writ petitions went on. 13. A note dated 04.11.2016 was prepared in the Government and placed before the Departmental Minister, on which the following decision was taken by him on 09.11.2016:- ...[VARNACULAR TEXT OMITTED]... 14. In the meantime, on 5.11.2016, the petitioner filed Writ Petition No. 26429 (SS) of 2016, challenging the re-convening of the meeting of Board of Director vide order of the Government dated 26.10.2016, so, this Writ Petition for all practical purposes as become infructuous. 15. Based on the aforesaid, the State Government woke up and passed an order dated 17.11.2016 on the representation of the petitioner in compliance of the order dated 01.09.2016 as corrected on 05.09.2016 passed in Writ Petition no. 20638 (SS) 2016 and rejected the same. When the other petitions were already pending and the matter was already subjudiced, the Court is of the opinion that once the matter was subjuduce and the Court was seized of the matter, it was not proper to have passed such an order instead, the Court should have been apprised of the decision taken by the State Government as aforesaid declining to enhance the age of superannuation. Nevertheless, ignoring this misdemeanor, the fact of the matter is that such an order was passed which was put to challenge by the petitioner in Writ Petition No. 27571 (SS) of 2016, i.e. the third writ petition which was filed after his retirement on 31.12.2016 in the circumstances aforesaid, when this Court on 18.11.2016, passed the following order:- "Heard. Petitioner is allowed to implead the Principal Secretary, Department of Public Enterprises, Civil Secretariat, Lucknow, as opposite party no.-4, during the course of the day. After the order dated 7.11.2016 the proposal of the corporation for enhancement of age of superannuation has been rejected by the State Government. The corporation shall also file an affidavit indicating its financial condition as to whether it is running in loss or profit as also the basis for sending the proposal for enhancement of the age of superannuation and whether it has the capacity and willingness to bear the burden of enhancement expenditure, if any. The original records pertaining to the rejection order shall also be produced on the said date. Counter affidavit be filed by the opposite party no.1. The State Government shall also indicate as to how many such cases are still pending, after collecting relevant documents from the concerned department. In view of the rejection the petitioner shall no longer continue in terms of the interim order granted earlier, but this shall be done without prejudice to his rights in the writ petition. The State Government shall also indicate as to in how many corporations the sixth pay commission recommendations have been implemented but the age of superannuation has not been enhanced and also the basis for grant of the revised pay scale as per the sixth pay commission. List this case on 14.12.2016 as first case of the day.", thereby vacating the continuance of the petitioner in terms of the earlier interim order but without prejudice to his rights in the writ petition. Therefore, now the rights of the petitioner and issues involved in the writ petition are to be adjudicated. 16. On a perusal of the record, it is not in doubt that the Board of Directors of the Corporation, which is the policy making body for it, is in favour of enhancing the age of superannuation of its employees, who are only four in number, from 58 to 60 years and it has also expressed its opinion that it has the financial capacity to shoulder the financial burden in this regard. The order dated 17.11.2016 passed by the State Government also shows that the Corporation is in profit of Rs. 8 lakhs for the year 2014-15 but according to it, Corporation has reserve surplus of only Rs.74 561459.54/-, whereas its liabilities by way of secured loan are Rs.51,52,14,961.27/-. 17. The Government has opined that loan disbursement has been stopped by the Corporation with effect from 2012-13. However, it is not disputed that the recovery of loan already advanced by the Corporation is in process. It is not out of place to mention that the Corporation performs welfare function inter alia by way disbursement of loans to the backward class persons after taking loan from the National Backward Class Corporation on slightly enhanced interest rates than the one on which it has taken loan. The difference is used to meet out its expenses. The difference normally of about 2% interest, is utilized by the Corporation as its fund for meeting out its expenditure including salary payable to its employees. 18. On a categorical query being put to the Standing Counsel for the State and Corporation both, as to whether the salary or other expenses of the Corporation were borne out by the State Government, the answer was in the negative. 19. On a similar query put to the learned Counsel for the petitioner, he said that not a single penny was paid by the State Government in this regard. The counter affidavit does not dispute this factual scenario. It does not say that any salary etc payable or which may become payable consequent to enhancement in age, will have to be borne by the State Government. 20. The first and foremost question which arises for consideration is what is the role of State Government in the functioning of the respondent-Corporation, which no doubt is a Government company incorporated in accordance with the provisions of the Companies Act, 1956. 21. In the counter affidavit, the State Government has sought to defend its decision based on Article 198 (a) and (b) which reads as under:- " 198. (a) The Governor of Uttar Pradesh in keeping with the statutory requirements of the Companies Act may from time to time issue directions to the Company as to the exercise and performance of its functions in matter involving the security of the State or substantial public interest and such other directions as he may consider necessary in regard to the finances and the conduct of business and affairs of the company and in the like manner may vary and annual any such directive (s). The Company shall give immediate effect to the directive so issued." 22. Page 79 of the counter affidavit is a copy of a noting of a Government file which has been placed before this Court today which mentions that Government Order issued by the Bureau of Public Enterprises, Government of U.P. dated 28.12.2011 has been issued after approval by the Cabinet of the State of Uttar Pradesh. Therefore, it is said that the said Government Order is referable to Article 198 (a). 23. Sri S.C. Verma, learned Counsel appearing for the petitioner, relies upon a Division Bench decision of this court in the case of Ganpat Prasad v. State of U.P. and Ors to contend that a similar Article appearing in the Articles of Association of U.P. Samaj Kalyan Nirman Nigam Limited fell for consideration before the Division Bench of this Court and after considering the same and all other statutory provisions, it opined that the matter in regard to which the Board of the Corporation is empowered to take decision, especially in service matters, are not amenable to the directions of the State Government under the aforesaid clause, especially as, under the memorandum of the association, there was no provision obliging the Corporation to seek approval from the State Government. The Division Bench Judgment also refers to another Division Bench Judgment in the case of U.P. State Warehousing Corporation v. Sunil Kumar Srivastava, wherein, the question of enhancement of age of superannuation was involved and a similar view had been taken that the State Government did not have power to interfere with the decision of the Board of Corporation to enhance the age. Para 16 to 24 of the said judgment reads as under:- "16. One of the question involved in the present bunch of writ petition is whether the resolution of the Board of Directors requires any approval from the State Government, that too under the teeth of Clause (IX), (X) and (XV) of Chapter XVI of the Memorandum of Association (supra). The overall reading of the Memorandum of Association reveals that it is the Board of Director which has empowered to adjudicated the controversy with regard to age of superannuation of the employees of the Nigam. The Government or the Governor has got no right to interfere with the decision taken by the Board of Director with regard to service condition of the employees of the Nigam. This fact is also obvious from Article 202 of the Memorandum of Association relied upon by learned State counsel as well as counsel for the Nigam. A perusal of Memorandum of Association reveals that the power of Governor is to issue appropriate order or direction is the subject matter which falls under the Companies Act or in public interest or for national security. That is why Article 202 speaks for exercise of power by Governor using the word " The Governor of Uttar Pradesh in keeping with the statutory requirements of the Companies Act..........". At the face of record the power is to be exercised by the Government relates to subject matter of the Nigam covered by the Companies Act or in public interest or for national security. 17. Shri Anuj Kudesia learned counsel for the respondents invited attention towards different provisions of the Companies Act, starting from Section 617. The provisions contained in Section 617 and onward of the Companies Act deals with the business of the Government Companies. It relates to share and other related business management and not with the service condition. 18. Learned counsel for the petitioner has not invited attention towards any provision of the Companies Act which may deal with the service condition of the employees. Of course power of general superintendence may be for all administrative function, but once memorandum confers the power on the Governor to deal with the specific subject matter then it means it relates to specified subject and not the service condition. 19. There is one other aspect of the matter. While deciding the Special Appeal reported in 2013(3) ADJ 745, U.P. State Warehousing Corporation v. Sunil Kumar Srivastava, a Division bench of this court of which one of us (Hon. Devi Prasad Singh, J.) was a member had dealt with the power of the State Government and the autonomy of the government companies. It has been held by Division Bench though power conferred on the Board of Directors without containing any provision with regard to approval from the State Government for its routine work, does not confer any right on the State Government to approve or disapprove the decision of the Board of Directors. Once the regulative power with regard to service condition is conferred on the Board of Director then Government has no say in the matter. A Division Bench has also dealt with the power of the State Government with regard to policy matter. A finding has been recorded that Government has got no role with regard to day to day functioning of the Corporations. Keeping in view the statutory provision with regard to U.P. State Warehousing Corporation, the Division Bench has recorded a finding as under:- "64. In view of above, the impugned judgment and order passed by Hon'ble Single Judge requires no interference on merit but it requires some modification in terms of the finding recorded hereinafter :- (I) Policy decision means a decision in Rem, not in Personem. (II) Sub Section (4) of Section 20 may not be read in isolation but it should be read conjointly along with Sub Section(5) of Section 20 of the Act which provides that in the event of conflict with regard to the question of policy between the Central and State Warehousing Corporation, the matter shall be referred to the Central Government whose decision shall be final. A conjoint reading of Sub Section (4) and Sub Section (5) of Section 20 reveals that the policy decision should be pre-existing policy regulating an issue. In absence of any pre-existing policy decision, that too keeping in view Section 23 of the Act, the Board of Directors is empowered to take decision with regard to recruitment and appointment of its officers and staff, regulate service conditions. Whether the government has got right to regulate the service conditions of the Corporation by taking a policy decision under the teeth of Section 23 of the Act is a question, which we leave open in case raised in appropriate case. (III) Statutory corporations are autonomous bodies to some extent and the government lacks jurisdiction to interfere in their day to day functioning. Statutory corporations are juristic personality and they may sue and may be sued. Being legal entity, they have right to discharge their obligations in accordance with statutory provisions. The government lacks jurisdiction to interfere in their day to day functioning. (IV) Under Section 23 of the Act, the appellant U.P. Warehousing Corporation has got right to make appointment of officers and employees. A decision to fill up the vacancies in accordance with rules is to be taken by the Corporation itself and the Government has not been conferred power under the Act to interfere in the matter. Of course, the Corporation while taking a decision to make recruitment of officers and employees has to abide by law. Instead of sending the matter to the State Government for seeking approval for regularisation, the Board of Directors should have taken a decision on its own within the four corners of Section 23. Appropriate Scheme or regulation should have been framed by the Board of Directors for regularisation and continuance of almost 2000 respondent employees working since more than decade. (V) Since out of 55 posts, 30 posts have been reserved leaving 25 posts for general category, the impugned advertisement suffers from the vice of arbitrariness in view of settled principle of law (supra)." 20. In view of above, we are of the view that Government does not have got power to approve or disapprove with regard to decision taken by the Board of Directors for enhancement of age. It is also not necessary to Board of Directors to send its resolution for approval to the State Government in case, the Memorandum of Association does not contain any provision to seek approval from the State Government. 21. Since, with regard to service condition the Memorandum of Association does not contain a provision to seek approval from the State Government then it is not necessary to seek approval from the State Government. However, in the present case since, according to Shri Anuj Kudesia learned counsel for the Nigam the service rule has been amended though in pursuance to circular of the State Government no further finding requires and employees shall deem to continue up to the age of 60 years who were in service on the date of notification. 22. A perusal of the decision of the Nigam dated 23.12.2011 reveals that it is prospective in nature. Accordingly, the employees who were in service up to 23.12.2011 shall be entitled to continue up to age of 60 years. It has vehemently been argued by learned counsel for the petitioner that all those employees who have filed writ petition be entitled to continue up to the age of 60 years. It has been also argued that the decision taken by the Nigam dated 23.12.2011 should be given retrospective effect. A perusal of the Office memorandum dated 23.12.2011 of the Nigam reveals that it has been given prospective effect. No retrospectivity can be given by the Courts to the decision taken by the Nigam or the Corporation with regard to age of superannuation as it shall amount legislation by process of judicial review. 23. It is well settled proposition of law that what should be age of superannuation is a subject matter which falls within the domain of State Government or the Employer(Corporation). In case, Government order or the office memorandum which increased the age of superannuation from particular date prospectively then it shall deem to be prospective in nature. Hon'ble Supreme Court in the cases reported in 2008 AIR SCW 2317, Government of A.P. and others v. N. Subbarayadu and others and 2007 (2) UPLBEC 1989, B. Bharat Kumar and others v. Usmania University held that circular for extension of age of superannuation binding. It is for the State Government or within the jurisdiction of executive authority to consider and decide the age of superannuation. No interference by the Court is called for. 24. In view of above, we allow the writ petition to the extent that impugned Government order dated 4.7.2007 and 17.9.2007 suffers from lack of jurisdiction interfering with the functioning of the Nigam with regard to age of superannuation. Accordingly, writ petition is allowed. Impugned orders dated 4.7.2007 and 29.6.2009 and 17.9.2007 are quashed. All employees who were in service up to 23.12.2011 shall be entitled to continue up to the age of 60 years. The employees who have worked even after age of 58 years shall be entitled for pensionary benefit keeping in view the age of superannuation of 58 years and in case, they have served and paid salary beyond 58 years, then no recovery shall be made from them. Though we are of the view that the Government order dated 22.11.2012 suffers from lack of jurisdiction but keeping in view the fact that Nigam itself had amended Service Rules enhancing the age up to 60 years we are not passing any order over it on merit, more so when it has not been impugned." 24. It is noticeable that in the said case the enhancement of age of superannuation was made effective prospectively and was not given retrospective effect based on the date of decision by the Corporation, as is mentioned in paragraph 22. 25. Though neither of the parties cited before us the judgment of the Supreme Court in the case of State of U.P. v. Pritam Singh and Ors reported in (2014) 16 SCC 774 however as it is relevant, therefore, the same is being referred. The said matter pertained to the U.P. Awas and Vikas Parishad, a body corporate constituted under the U.P. Awas and Vikas Parishad Adhiniyam 1965. The dispute there was that the employees of the Vikas Parishad were members of the contributory Provident Fund Scheme. The Vikas Parishad desired to grant its employees better retiral benefits, which was turned down by the State Government. One of the issues raised before the Supreme Court by the State of U.P. was that scheme could not have been formulated by the Vikas Parishad and given effect to in the absence of express approval by the State Government. 26. The contention was based on the provisions contained in U.P. State Control Over Public Corporation Act, 1975, Section 2(1) thereof, which reads as under:- "2. (1) Power to issue directions to statutory bodies.- Every statutory body (by whatever name called), established or constituted under any Uttar Pradesh Act, excepting Universities governed by the Uttar Pradesh State Universities Act, 1973 as re-enacted and amended by the Uttar Pradesh University (reenactment and Amendment Act), 1974, shall, in the discharge of its functions, be guided by such directions on questions of policies, as may be given of it by the State Government, notwithstanding that no such power has expressly been conferred on the State Government under the law establishing or constituting such statutory body" (emphasis supplied) 27. The contention was repelled with reference to the functions of the Board as defined in Section 15 of the Act, 1965. The Court opined that there can be no doubt that it is open to the State Government to issue directions on questions of policy to all the public corporations in the State of Uttar Pradesh, in furtherance of the mandate contained in Section 2(1) of the Act, 1975, however, the directions could be issued only in respect of questions of policy having a nexus to the "discharge of its functions". It then noticed Section 15 and found that conditions of service of employees, in its opinion, did not constitute a function of the Vikas Parishad and as such it was satisfied that the directions contemplated under Section 2(1) of the Act, 1975 did not extend to the direction issued by the State of U.P. in the orders impugned before it. Accordingly, it rejected the contention of the State. 28. However, there is a contra view expressed in the case of State of U.P. v. Neeraj Awasthi and Ors reported in 2006 1 SCC 667, wherein, services of certain work-charge employees were terminated by the Mandi Parishad on the directions of the State Government and one of the questions which fell for consideration before the Supreme Court was as to the power of the State to issue directions in this regard. This aspect has been dealt with paragraphs 40 to 46, which are quoted herein below:- "40. The State in exercise of the power conferred upon it could issue directions. the power of the State Government is confined to issue directions on questions of policy. It cannot, however, interfere in the day-to-day functioning of the board. Such policy decision, however, must be in relation to the activities of the Board under the Act and not dehors the same. (See Rakesh Ranjan Verma, Ram Autar and Bangalore Development Authority v. Ram Hanumaiah.) 41. Such a decision on the party of the State Government must be taken in terms of the constitutional scheme i.e. upon compliance with the requirement of Article 162 read with Article 166 of the constitution. In the instant case, the directions were purported to have been issued by an officer of the State. Such directions were not shown to have been issued pursuant to any decision taken by a competent authority in terms of the Rules of Executive Business of the State framed under Article 166 of the Constitution. 42. In Punit Rai v. Dinesh Chaudhary this court held : (SCC pp. 222-23, para 42) " 42. The said circular letter has not been issued by the State in exercise of its power under Article 162 of the Constitution of India. It is not stated therein that the decision has been taken by the Cabinet or any authority authorised in this behalf in terms of Article 166 (3) of the constitution of India. It is trite that a circular letter being an administrative instruction is not a law within the meaning of Article 13 of the Constitution of India. (See Dwarka Nath Tewari v. State of Bihar.) 43. However, it is not correct that the power of the State to issue directions must be confined to the matters enumerated in sub-section (1) of Section 26-L of the Act. Section 26-L is subject to the provisions of the Act the functions of the Board enumerated in Section 26-L of the Act are, therefore, not exhaustive. Appointment of servants and officers is also one of the functions of the Board. The board also has the right to supervise and control the activities of the officers and Market committees. In that view of the matter, if a policy decision is taken by the Board in regard to the appointment or terms and conditions of the servants, in the event regulations made in this behalf do not contain any provisions, such policy decision must conform to the directions of the State issued in that behalf, if any. The board further is empowered to do such other things as are specified in clause (x) of Section 26-L of the Act. 44. The Board, however, in law could not have abdicated its power in favour of the State Government. 45. We are, therefore, of the opinion that the direction by the State was strictly not in accordance with law. 46. The directions of the State were, therefore, although not binding on the Board, the same cannot be said to be wholly irrational. In his report dated 07.01.1998, the Chairman of the Board sought for advice of the Government. The State had the power of supervision over the activities of the officers of the Board and the Board itself. While granting such advice, the State had taken into consideration the last segment of employment. The State was not expected to direct the Board and the Board in turn could not have directed the Market Committees to dismiss all the employees who had been illegally appointed. If such directions had been confined to the period 1.4.1996 to 30.10.1997 on following certain basic principles like last-come-first-go basis, we do not see any reason as to why the same would be termed to be arbitrary or discriminatory." 29. For the purposes of the present case as it is not in doubt that the Government Order dated 20.12.2011 was issued after a Cabinet decision in this regard, therefore, it is paragraphs 43 and 44 alone which are relevant and a perusal thereof shows that just as in Pritam Singh likewise in Neeraj Awasthi also Hon'ble Supreme Court considered a similar provision as Section 2(1) of the Act, 1975 as contained in Section 26(m) of the Mandi Adhiniyam, 1964 and the functions of the Mandi Parishad as defined in Section 26 (L) and noticed that Section 26 (L) was subject to the provisions of the Act, just as Section 15 of the Vikas Parishad Adhiniyam, 1965 was and opined that the functions of the Board enumerated in Section 26-L are, therefore, not exhaustive, appointment of servants and officers is also one of the functions of the Board. The Board also has the right to supervise the control the activities of the officers and market committees. In that view of the matter, if a policy decision is taken by the Board in regard to the appointment or terms and conditions of the servants, in the event regulations made in this behalf do not contain any provisions, such policy decision must confirm with the directions of State issued in that behalf, if any. However, in para-44 it opined that the Board could not abdicate its power in favour of the State Government. 30. Now, in this case there is no such provision as existing in Section 2(1) of U.P. State Control Over Public Corporation Act, 1975 nor as contained in Section 26 (m) of the Mandi Adhiniyam, 1964. However, as noted herein above, there is Article 198 (a). On a reading of the said Article, the Court finds that the words the Governor of Uttar Pradesh in keeping with the statutory requirement of the Companies Act may from time to time issue directions to the company as to the exercise and performance of its functions in matter involving the security of the State or substantial public interest or such other directions as he may consider necessary in regard to the finances and conduct of business and affairs of the company and in the like manner may vary and annul any such directives. 31. The aforesaid Article can be broken up into various parts as under:- (i) The Governor of Uttar Pradesh; (ii) in keeping with the statutory requirements of the Companies Act; (iii) may from time to time issue directions to the company as to the exercise and performance of its functions in matter involving the security of the State or substantial public interest. (iv) or such other directions as he may consider necessary in regard to the finances and the conduct of business and affairs of the company and in the like manner may vary and annul any such directive(s); (v) the company shall give immediate effect to the directives so issued. 32. Now, the question is whether the subject matter of the Government Order dated 20.12.2011 falls within the ambit of the aforesaid Article, as, it is not in doubt that being based on a Cabinet decision it would qualify condition no. (i) aforesaid, if a very strict view of the matter requiring the recital that the same had the approval of his excellency the Governor, is ignored. 33. The second condition imposed is that the directions to be issued by the Governor to the Company have to be "in keeping with the statutory requirements of the Companies Act". Nothing has been brought on record to indicate that under the Companies Act there is any requirement prescribed for Government Companies regarding laying down of conditions of service such as age of superannuation or its enhancement. 34. The third requisite is that "from time to time issue directions to the company as to the exercise and performance of its functions in matter involving the security of the State or substantial interest". Thus the directions have to be as regards the exercise and performance of functions of the Corporation in matters involving the security of State or substantial public interest, none of which are involved in the matter of enhancement of age of superannuation of employees of the Corporation, therefore, this condition is also not satisfied. 35. The fourth condition is that "such other directions as the Governor may consider necessary be issued in regard to the finances and the conduct of business and affairs of the Company". While "enhancement of age of superannuation is not covered under finances", the words "Conduct and business and affairs of the Company" are of vide import and would require an interpretation. They would cover every business and affair of the Company. The business and affairs of the company have not been specifically mentioned, but obviously they are what its object are as is mentioned in the Memorandum of Association. Even though laying down of service conditions such as age of superannuation and its enhancement is not one of the objects of the company, it cannot be said that it is not part of the affairs of the company, but the Court is of the view that the words 'business and affairs of the company' mentioned in Article 198 (a) have to be read conjointly with the opening line of the provision which says "The Government of Uttar Pradesh in keeping with the statutory requirements of the Companies Act" and as already stated herein above, laying down of conditions of service including age of superannuation is not a statutory requirement in the Companies Act, therefore, the business and affairs of the Company in Article 198(a) are only such business and affairs of the Company with regard to which there is a statutory requirement or obligation and not otherwise. Thus, matters such as laying down of service conditions of employees would fall within the domain of the Corporation and not that of the State Government stricto sensu, especially, in view of the power bestowed on the Board vide Article 125 (ix) and (x). The proviso to Clause ix to Article 125 may empower the State Government to issue directions from time to time in matters of creation and filling up of post in the Company but that is a separate provision and has nothing to do with Article 198 (a), therefore, in these circumstances the benefit of para-43 of the Neeraj Awasthi's case is not available in this case as the provisions under consideration are different than in the said case, however, considering the fact that in the present case the petitioners have not challenged the G.O. dated 20.12.2011 and the petitioner is in fact seeking the benefit of the said order and Resolution of the Board of Directors passed in pursuance thereof, therefore, in the peculiar facts of the present case, the validity of the impugned action is to be seen in the light of the aforesaid G.O. dated 20.12.2011, to which the Board as also the petitioners herein have consented but keeping in mind that the Board cannot in this context abdicate its powers to the State Government. 36. On perusal of the Government order dated 20.12.2011, this Court finds that in principle the State Government has taken a decision to enhance the age of superannuation of employees of such Corporations from 58 to 60 years. However, subject to certain conditions which are as under:- (a) If such enchancement would entail any additional financial burden then whether the Corporation concerned can bear it or not? (b) If it can, then Board of Directors shall pass a Resolution in this regard. (c) If such Resolution is passed, the concerned Corporation shall send its proposal to its administrative department (in the Government) (d) The Administrative Department shall examine it at its level and obtain requisite approval from the competent level (Departmental Minister concerned through Principal Secretary) (e) On such approval, orders for enhancement of age of superannuation would be issued. (f) State Government shall not extend any financial assistance to such Corporation consequent to such enhancement of age of superannuation 37. It is in pursuance to this Government Order that Board of Directors of the respondent-Corporation passed a Resolution on 28.03.2012 favouring the enhancement of age of superannuation. Obviously this was taken in keeping with the parameters laid down in the aforesaid Government Order. The same was again reiterated on 04.11.2016 after the matter was remanded to it by the State Government in pursuance of the decision of the Departmental Minister dated 26.10.2016. The said decision dated 04.11.2016 has already been quoted herein above, which specifically mentions that it has the capacity to endure the financial burden as aforesaid. 38. Now, at this stage, it is the note placed before the Department Minister twice i.e. 26.10.2016 and 09.11.2016 which are very relevant. The relevant extract of the said notes starting from internal page112 to 115 of the original file which has been placed before the Court is quoted hereinunder:- ...[VARNACULAR TEXT OMITTED]... 39. This is the note dated 25.10.2016 forwarded to the Department Minister with the approval of the Principal Secretary of the Department, which categorically supports the enhancement of the age of superannuation. It is on the basis of this note that a statement was made before this Court on 26.10.2016 that a decision had been taken to enhance the age of superannuation but the approval of Departmental Minister was awaited. 40. After the matter was remanded back to the Board of Directors vide order dated 26.10.2016 and the Board of Directors in its meeting dated 04.11.2016 reiterated its resolve as aforesaid and file was again put up to the Departmental Minister, the noting in this regard is also very relevant. The noting dated 04.11.2016 as contained at Page 122 to 125 is quoted hereinunder:- ...[VARNACULAR TEXT OMITTED]... "........The aforesaid order was passed for the reason that in several cases petitioner had approached the Court within time seeking a decision by the State Government on the proposal of the Corporation for enhancement of age but on account of no decision having been taken they retired. Subsequent to their retirement and during the pendency of the writ petitions the decisions were taken in some matters enhancing the age of superannuation but as the said decision was not retrospective, therefore, the benefits was not made available to those who had approached the Court within time thereby causing irreparable financial loss to them as also lost of status. Today, Shri K.K. Shukla, learned Standing Counsel informed the Court that the Government, after the passing of the aforesaid order, has taken a decision to enhance the age of superannuation of the employees 25.10.2016 and has sent the proposal to the Departmental Minister for his approval. This would take some time. In the meantime, the petitioner is to attain the age of superannuation on 31.10.2016 but in view of the holidays in the Government officer w.e.f. 28.10.2016 he would be treated as superannuated from 28.10.2016 i.e. day after tomorrow, therefore, in these extraordinary peculiar circumstances in order to protect the 4 rights of the petitioner and also protect the petition itself from becoming infructuous, it is expected that the requisite decision shall be taken by tomorrow failing which it is provided that the petitioner shall be treated as continuing in service under the orders of this Court but shall not be paid salary till the next date of listing. It is not out of place to mention that the proposal was sent by the respondent-Corporation to the State Government way back on 16.04.2012 and thereafter a reminder was also sent in the year 2014 but the State Government kept sitting over the matter with folded hands. It is because of this extraordinary peculiar circumstances which have arisen that this order is being passed by the Court. List this case on 07.11.2016 as first case of the day to enable the Standing Counsel to place before the Court the final decision of the State. This order by itself shall not confer any benefit upon the petitioner to salary etc. unless a favourable decision is ultimately taken. Let the copy of this order be provided to the learned counsel for the parties itself today, on payment of usual charges." ...[VARNACULAR TEXT OMITTED]... 41. On a bare perusal of the aforesaid noting also it is evident that officers of the State Government up to the level of Principal Secretary were in favour of enhancement of age of superannuation and had recommended the same taking into consideration all the relevant parameters mentioned in the G.O. dated 20.12.2011. However, the Departmental Minister took a contrary view of the matter as has already been quoted herein above and opined that enhancement of age for one employee was not appropriate, it was a policy decision which involved financial burden. The Departmental Minister on a perusal of the record also opined that financial condition of the Corporation was not healthy and it was not in a position to shoulder additional financial burden consequent to proposed enhancement of age, accordingly, he declined the proposal. 42. It is not out place to mention that the said decision of the Departmental Minister dated 09.11.2016 refers to a file No. 786 of 2012, relating to regularization of employees which had no relevance to the regular employees of the Corporation, who were only four, one of which was the petitioner. 43. It is also not out of place to mention that four regular employees of this Corporation including the petitioner were granted the revised pay scales as per the sixth pay commission obviously on the ground that it was in a position to shoulder the financial burden ensuing therefrom as it was one of the pre-requisites. 44. It is not out of place to mention that in the list annexed by the State Government as C.A.-7, some of the Corporations where the age of superannuation has been enhanced i.e. those at serial no. 2 and 3, in their cases the employees are still being paid salary in the pay scale of the fourth pay commission, meaning thereby, they have yet not been granted the sixth pay commission. Be that as it may, as has already been observed earlier and is also evident from the note placed before the Departmental Minister, as there were only four regular employees, one of which was due to retire on 31.12.2016 and three others were to retire in 2024 and the cumulative additional financial burden, on enhancement of age of superannuation from 58 to 60, in respect of all the four persons would be only about 4.5 lakhs, as has been mentioned in the note of Principal Secretary and also mentioned in the counter affidavit. As far as petitioner is concerned, the enhancement based on implementation of revised pay scale in future was out of the question as he would be retiring within two years i.e. by 2018 and he was only one out of the three persons, therefore, as of now within two years a much lesser financial burden was involved. In any case, a meagre financial burden of Rs.4.48 lakhs on the basis of such enhancement as against the annual profit of about Rs. 8 lakhs as is mentioned in the impugned order of the State Government dated 17.11.2016 apparently could not have been a reason for declining the proposal for enhancement and the Departmental Minister obviously committed a gross error in this regard. 45. The Court is conscious of the fact that normally in such matters the Court does not interfere but in the facts of the present case when arbitrariness is writ large on the face of the record, it has to interfere. 46. The reasoning given by the Departmental Minister that age cannot be enhanced for one person can be looked at from another angle also, as, if it is only one person with regard to whom the financial burden is to be shouldered, especially when in principle, the State Government has taken a decision to enhance the age and the conditions attached to it are also satisfied in the present case, then, such a decision was contrary to the Government Order dated 20.12.2011 which reflected the decision of the Cabinet i.e. a higher authority than the Departmental Minister. 47. As far as the opinion expressed by the Departmental Minister that the financial health of the Corporation is not good, with respect, his decision does not spell out as to how he reached this conclusion. It is contrary to the note which was placed before him by the Principal Secretary. No doubt, the Departmental Minister had the authority to take the final decision based on the material on record, but, after assessment by the experts in the field, a note was prepared and placed before him stating that the Corporation was in a position to withstand the additional financial burden which was meagre i.e. less than five lakhs, and in case of the petitioner even lesser as the other three were to retire eight years later, therefore, there had to be some basis for the Departmental Minister to take a contrary view as such a decision could not be taken on ipse dixit of an individual. 48. In these circumstances, considering the background of the case, the decision of the State Government as impugned herein which is contrary to its own note placed before the Departmental Minister cannot be sustained. The order dated 17.11.2016 is nothing but an attempt to justify the decision of the Departmental Minister, otherwise, up to the level of Principal Secretary, an opinion had already been formed that the financial condition of the Corporation was such as to enable it to shoulder the financial burden. 49. None of the pre-requisites mentioned in the G.O dated 20.12.2011 were violated, therefore, there is no reason as to why the impugned decision should have been taken. It seems that petitioner had been pursuing the matter before the Court strenuously and quite possibly to teach him a lesson. 50. In view of the above, the impugned order and notices are hereby quashed. 51. In view of the above, in keeping with the decision of the Division Bench of this Court in the case of Ganpat Prasad v. State of U.P., reported in (2013) 3 UPLBEC 2190, wherein age of superannuation was given prospective effect from the date of Board of Directors of the Corporation, on the same analogy it is ordered that the benefit of enhanced age of superannuation of 60 years shall be available with effect from 28.03.2012, especially as only one person has retired thereafter i.e. the petitioner and other three are to retire in 2024. The State Government shall pass necessary orders in this regard within three weeks from the date a certified copy of order is submitted. 52. Consequences shall follow accordingly as per law. Petitioner shall be reinstated with continuity in service till he attains the age of 60 years. 53. The Court takes note of the fact that the decision of the Board dated 28.03.2012 remained pending with the State Government for almost four years, whereas a prompt decision ought to have been taken in this regard. Had it been taken timely, this dispute could have been decided before the retirement of the petitioner. 54. Writ Petition No. 24968 (S/S) of 2016 and 27571 (S/S) of 2016 are allowed in the aforesaid terms. 55. The Writ Petition No. 17797 (SS) of 2016 and Writ Petition No. 1479 (SS) of 2016 be de-linked from the decided writ petitions and shall be listed separately on 10.07.2017.;