The Delhi High Court has ruled that an employee appointed by the President of India, also acting in the capacity of a President of an incorporated Government company, cannot be said, in the eye of the law, to hold a civil post within the contours of Section 14(1) of the Administrative Tribunal Act, 1985.
The High Court explained that the post held by the Respondent No.1 (serving as an Executive Director of a government company, NBCC India, under aegis of Respondent No.2 (Ministry of Housing and Urban Affairs) does not constitute a post under the Union within the meaning of Section 14(1) of the Act of 1985. Consequently, the Central Administrative Tribunal lacks the jurisdiction to entertain the Original Application filed by such an employee, and the absence of jurisdiction is a fundamental and incurable defect, rendering all consequential orders void ab initio.
The Division Bench comprising Justice Anil Kshetarpal and Justice Amit Mahajan observed that the Respondent No.1 has prayed for quashing the HSCC Board Resolution which reiterated the decision taken by the Board of Directors (BoD) of the Petitioner No.1 (NBCC India Limited). The Competent Authority, namely the President of the Petitioner No.2 (HSCC India Limited), had sanctioned and conveyed its approval to the resolution passed by the BoD of the Petitioner No.1.
By virtue of the enabling powers conferred under the Article of Association (AoA) of the Petitioner No.2, the President of the company is authorised to convey such approval. This decision was not taken by the Respondent No.2; rather it was taken by the President of India, in her capacity of President of the Petitioner No.2, who is the head of the company and as such there existed a relationship of master and servant between the Petitioner No.2 and the Respondent No.1, added the Bench.
Thus, the Bench pointed out that the decision to terminate the services was not taken by the President in her individual executive capacity, rather it was the decision of a company head, who is the employer of the Respondent No.1. Therefore, the Petitioner No.2 possessed the requisite locus standi to file the present Petition because the resolution dated 02.02.2026 was passed by the BoD of the Petitioner No.2, making the company the proper party to maintain the petition.
The Bench then went on to observe that the Petitioner No.2, though a subsidiary of the Petitioner No.1, is not denuded of its independent corporate existence; rather, it stands as an independent incorporated company, possessing its own legal identity and corporate authority. The fact that the President of India, in her capacity as the President of the Petitioner No.2, exercises a significant role under the AoA does not lead to a conclusion that the Petitioner No.2 is not an independent entity.
Corporate control or representation by the Hon’ble President of India does not equate to subordination to the Union in the constitutional sense. The employees of an incorporated Government company cannot be said to hold a civil post and would not fall within the description of a holder of a civil post under the Union, as stated in Articles 310 and 311 of the Constitution, emphasised the Bench.
Further, the Bench pointed out that the Respondent No.1 was not appointed to any civil service of the Union, nor did he hold any civil post under the Union; his position falls squarely within the ambit of a tenured post in an incorporated Government company. Also, the existence of a notification under Section 14(2) of the Act of 1985 qua the Petitioner No.1 cannot, ipso facto, be determinative of the jurisdiction of the Tribunal over disputes pertaining to the Petitioner No.2. The Petitioner No.2 cannot be subsumed within the ambit of the Petitioner No.1 merely by virtue of a notification issued in respect of the latter.
Lastly, the Bench observed that the appointment was made by the President of the Government company in accordance with her enabling powers conferred under Articles 94 and 95 of the AoA. The authority exercised was purely corporate in nature, arising from the company as a legal entity and not from the constitutional executive capacity. The decision of termination was taken by the BoD of the Petitioner No.2, and the ultimate authority in this regard was the President of the company, who is the Competent Authority as per Article 112 of the AoA, which authorises the President to remove any Director including the Chairman from the office of the Petitioner No.2.
The Disciplinary Authority is the President of the company, who happens to be the Hon’ble President of India; therefore, the exercise of disciplinary powers arises from the corporate office, not from the personal constitutional role of the President. The legal consequences of such action must be viewed in a corporate and not a constitutional context, concluded the Bench.
Briefly, the Petitioner No.1 (NBCC India Limited) is an incorporated Government company functioning under the aegis of Respondent No.2 (Ministry of Housing and Urban Affairs, Government of India). The Petitioner No.2 (HSCC India Limited) is a subsidiary company, incorporated under the Companies Act, 1956 on 13.03.1983, operating within the corporate fold of the Petitioner No.1. The Respondent No.1 was serving as an Executive Director (Engineering) with the Petitioner No.1 and was selected by the Search-cum-Selection Committee for the post of Managing Director (MD) to the Petitioner No.2. In 2023, the Respondent No.2 conveyed approval of the Competent Authority for the appointment of the Respondent No.1 as MD-Petitioner No.2, for a tenure of five years.
In 2025, the Company Secretary of the Petitioner No.1, acting in furtherance of a decision of its Board of Directors (BoD), sought an explanation from the Respondent No.1 regarding alleged serious procedural lapses, irregularities in project execution, and other operational and administrative matters. The Respondent No.1 was granted five days of time to submit his response and submitted a response on 07.12.2025 comprising more than 2500 pages.
Later, in the meeting held on Dec 11, 2025, the BoD of the Petitioner No.1 found the reply unsatisfactory, decided to forward the details to the Administrative Ministry, and directed that the powers vested in MD-Petitioner No.2 be seized immediately. In 2026, the BoD of the Petitioner No.2 adopted the recommendations made by the BoD of the Petitioner No.1. Consequent upon approval of the Competent Authority, the Respondent No.1 was repatriated to his parent Cadre (Petitioner No.1), and his services from the post of MD-Petitioner No.2 were terminated with immediate effect.
The Respondent No.1 invoked the jurisdiction of the Central Administrative Tribunal by filing an Original Application under Section 19 of the Administrative Tribunal Act, 1985. The Petitioners raised a preliminary objection regarding the maintainability of the application due to the absence of a notification under Section 14(2) of the Act of 1985 bringing employees of the Petitioner No.2 within its jurisdiction. In 2026, the Tribunal overruled the preliminary objection and proceeded to stay the termination of the service of the Respondent No.1.
Appearances:
ASG Brijender Chahar, along with Advocates R.V. Sinha, A.S. Singh and Shriya Sharma, for the Petitioners
Senior Advocates Sudhir Nandraj Jog and A.K. Behra, along with Advocates Sakshi Kakkar, Shakti Singh and Sarthak Karol, for the Respondents
