Writ of Quo Warranto Is Limited: Supreme Court 2013 in CESU v. Dhobei SahooSets Aside HC Order Quashing Chairman-cum-CEO Arrangement. The Supreme Court inCentral Electricity Supply Utility of Odisha v. Dhobei Sahoo held that High Courtexceeded jurisdiction in PIL by issuing writ of quo warranto against Chairmanfunctioning as CEO of CESU and ordering recovery of honorarium. The Court on13.09.2013 set aside Orissa High Court judgment dated 28.03.2012, holding quowarranto lies only when appointment violates statutory provisions or eligibility, not foradministrative arrangements under a Scheme. Respondent No.5, B.C. Jena, formerGRIDCO CMD and OERC Member with 45 years experience, was nominated Chairmanwithout remuneration and later given additional charge of CEO with Rs.70,000/-honorarium till regular appointment. Practically, what we have seen is that PILs are filedchallenging temporary in-charge arrangements as “appointment”. Supreme Court saidCommission had power under Clause 4(ix) of 2006 Scheme as amended on 12.11.2010to allow one person to discharge functions of Chairman and CEO. This blog explainsUniversity of Mysore v. Govinda Rao AIR 1965 SC 491, why Hari Bansh Lal (2010) 9 SCC655 applies, and why recovery of salary in quo warranto is impermissible.
Facts: OERC Amends Scheme to Allow Chairman-cum-CEO, High Court Quashes as“Usurper” and Orders Recovery. CESU, a deemed licensee under Electricity Act 2003,was managed by OERC after CESCO licence revoked. On 10.08.2010 OERC entrustedCEO functions to Chairman B.C. Jena till alternative arrangement, with perquisites ofCEO but no monthly emoluments. On 12.11.2010 Scheme amended inserting Clause4(ix): “Whenever needed, the power, functions and responsibilities of Chairman and CEOcan be discharged by one person, designated as Chairman-cum-CEO.” HonorariumRs.70,000/- fixed. PIL WP(C) 23268/2011 filed alleging violation of GRIDCO ServiceRegulations, age bar, and abuse of power. High Court held: 1. Chairman cannotsupervise himself as CEO, violates natural justice, 2. Appointment contrary to ServiceRegulations, 3. Usurper to public office, 4. Directed recovery of amount. The SupremeCourt in University of Mysore v. C.D. Govinda Rao AIR 1965 SC 491 held quo warrantoonly if holder lacks legal authority or appointment contrary to statutory rules. TheSupreme Court in High Court of Gujarat v. Gujarat Kishan Mazdoor Panchayat (2003) 4SCC 712 held quo warranto cannot issue unless statutory rule violated. In CESU, nostatutory rule barred arrangement; Scheme expressly permitted it. A common mistakeclients make is filing PIL against interim arrangements. CESU says writ of quo warrantonot for policy wisdom. For Commissions, amend Scheme to authorize additionalcharge. For challengers, show statutory prohibition.
Chairman Holding CEO Charge Not Appointment: Supreme Court Distinguishes In-Charge Arrangement From Substantive Post. Supreme Court held: “The High Court haserroneously opined that it was an appointment. The 5th respondent was not getting twosets of salary.” Court said Chairman post was honorary with only sitting fee Rs.2000/-per meeting. CEO charge was temporary till regular selection. The Supreme Court inState of Haryana v. S.M. Sharma 1993 Supp (3) SCC 252 held holding additional chargeis not appointment to post. The Supreme Court in Mohd. Masood Ahmad v. State of U.P.(2007) 8 SCC 150 held transfer/posting is incidence of service, not appointment. InCESU, Clause 4(ix) empowered Commission to designate one person as Chairman-cum-CEO. The Supreme Court in Hari Bansh Lal v. Sahodar Prasad Mahto (2010) 9 SCC 655held suitability/eligibility within domain of appointing authority; no age limit prescribed,extension depends on performance. Here B.C. Jena was 69 but no age bar in Scheme. The Supreme Court in Renu v. District & Sessions Judge (2014) 14 SCC 50 held in-charge arrangements valid to avoid vacuum. In our experience, High Courts quash in-charge orders citing “usurper” without examining enabling provision. CESU corrects this. For regulators, use Scheme power. For officers, in-charge not usurpation.
No Recovery in Quo Warranto: Supreme Court Says Denial of Pay for ServiceRendered Is Forced Labour Under Article 2. High Court directed recovery of honorariumfrom B.C. Jena. Supreme Court quashed: “While exercising the power for issue of writ ofquo warranto the Court only makes a public declaration that the person holding thepublic office is a usurper... Till the declaration is made, the incumbent renders serviceand when he has rendered service he cannot be deprived of his salary. Denial of pay forthe service rendered tantamounts to forced labour which is impermissible.” TheSupreme Court in People’s Union for Democratic Rights v. Union of India (1982) 3 SCC235 held Article 23 strikes at forced labour even if service rendered under void contract.The Supreme Court in State of Punjab v. Jagjit Singh (2017) 1 SCC 148 held “equal payfor equal work” and no recovery for work done. In CESU, Jena discharged CEO functionsfrom 10.08.2010 till HC order. Recovery would violate Article 23. The Supreme Court inBharat Sanchar Nigam Ltd. v. Ghanshyam Dass (2011) 4 SCC 374 held salary paid forwork done cannot be recovered even if appointment illegal, absent fraud. A commonmistake clients make is seeking recovery in PIL. CESU says quo warranto only ousts, nomonetary direction. For Courts, limit relief to declaration. For incumbents, servicerendered = pay earned.
Conclusion
Electricity Supply Utility of Odisha v. Dhobei Sahoo establishes that writ ofquo warranto service matter PIL CESU Dhobei Sahoo Supreme Court 2013jurisprudence limits quo warranto to statutory violation or lack of eligibility. SupremeCourt 13.09.2013 set aside HC order, upholding OERC power under Clause 4(ix) Schemeto make Chairman-cum-CEO. University of Mysore AIR 1965 SC 491, Hari Bansh Lal(2010) 9 SCC 655 applied. As the law stands, in-charge arrangements under Schemenot appointment, and no recovery of honorarium in quo warranto. For Commissions,amend Scheme for additional charge. For PIL petitioners, show statutory bar, not policy.For Courts, quo warranto not for administrative wisdom. The Supreme Court’s ruling inCESU protects utilities from disruption and upholds dignity of officers against recovery.
