Case BriefsSupreme Court

Supreme Court: The bench of R. Subhash Reddy* and Sanjiv Khanna, JJ has held that reinstatement with full back wages is not automatic in every case, where termination/dismissal is found to be not in accordance with procedure prescribed under law.

The ruling came in the matter where,

  • A Clerk-cum-Cashier was dismissed by the Allahabad Bank, alleging his involvement in the incident relating to burning of relevant Bank records.
  • The respondent was appointed in the Bank as Clerk–cum– Cashier on 23.09.1985 and he was placed under suspension on 13.02.1989 and dismissed from service vide Order dated 22.08.1991.
  • The Industrial Tribunal–cum–Labour Court found that though there was a strong suspicion, but there was no sufficient evidence to prove his misconduct to dismiss from service. However, on the ground that a case is made out by the management of loss of confidence, ordered payment of compensation of Rs.30,000/- in lieu of reinstatement.
  • The respondent, aggrieved by the award of the Industrial Tribunal–cum–Labour Court, seeking reinstatement with back wages, carried the matter to the High Court wherein it was held that suspicion, however, high may be, can under no circumstances be held a substitute to legal proof. The High Court, hence, directed reinstatement with all consequential benefits.
  • The directions issued by the High Court of Allahabad for reinstatement were stayed by this Court on 23.08.2019. During the pendency of these proceedings, the respondent – workman had attained age of superannuation.

Considering the aforementioned facts and circumstances, the Supreme Court held,

“Though, there was strong suspicion, there was no acceptable evidence on record for dismissal of the workman. However, as the workman has worked only for a period of about six years and he has already attained the age of superannuation, it is a fit case for modification of the relief granted by the High Court.”

Noticing that reinstatement with full back wages is not automatic in every case, where termination / dismissal is found to be not in accordance with procedure prescribed under law, the Court held that in the present case, the ends of justice would be met by awarding lump sum monetary compensation. It, hence, directed payment of lump sum compensation of Rs.15 lakhs to the respondent, within a period of eight weeks, failing which, the respondent will be entitled for interest @ 6% per annum, till payment.

[Allahabad Bank v. Krishan Pal Singh, 2021 SCC OnLine SC 751, decided on 20.09.2021]


Appearances before the Court:

For Bank: Advocate Rajesh Kumar Gautam

For Respondent: Advocate Rakesh Taneja

*Judgment by: Justice R. Subhash Reddy

Know Thy Judge| Justice R. Subhash Reddy

Case BriefsHigh Courts

Punjab and Haryana High Court: While deliberating over a matter of wrongful termination of a public servant’s services, Anil Kshetarpal, J., allowed the writ petition granting relief to the petitioner and observed that, “Mere observation that the departmental inquiry at this stage does not appear to be justified is not sufficient to invoke powers under Clause (b) of the 2nd Proviso to Article 311(2) of the Constitution of India.”

The factual matrix in the present matter is such that the present writ petition has been filed by the petitioner under Article 226 of the Constitution of India for issuance of a writ in the nature of certiorari for quashing of order dated 04-03-2020 passed by the respondent, dismissing the petitioner from service under Clause (b) of the 2nd Proviso to Article 311(2) of the Constitution of India. The petitioner was dismissed from the post of Constable in Punjab police basis his involvement in two grave offences. The first offence is that of rape and subsequent blackmail and FIR No. 14 had been registered in connection with the same. The second offence dates back to the time when the police party went in for the arrest of the petitioner when the petitioner ran away after he was apprehended. Protesting the same, a group of villagers entered into a scuffle with the police personnel and indulged in vandalism. As a result of the attack, a police official endured serious physical harm and another’s wallet and id card was snatched from him.

As a result of the above-stated acts, the respondent invoked Clause (b) of the 2nd Proviso to Article 311(2) of the Constitution of India to remove/dismiss the petitioner from service while doing away with the requirement of holding a departmental inquiry.

Counsel for the petitioner, Abhimanyu Tiwari has contended that the respondent did not state the reasons behind the act of dispensing with the requirement of holding inquiry and hence the order is unsustainable in the eyes of law. Several judgments were cited by him in order to substantiate his claim including that of Union of India v. Tulsi Ram Patel, (1985) 3 SCC 398 and Reena Rani v. State of Haryana, (2012) 10 SCC 21.

Counsel for the respondent, Anu Chatrath, in his defence has cited the judgments passed in Kuldip Singh v. State of Punjab, (1996) 10 SCC 659 and Chandigarh Administration, U.T. Chandigarh v. Ajay Manchanda, (1996) 3 SCC 753.

The question of law that came before this Court for resolution is-

“Whether in absence of sufficient reasons recorded in writing dispensing with the requirement of holding inquiry in the alleged misconduct of employee by the authority, order of dismissal/removal from service of employee, passed in exercise of the powers under Clause (b) of the 2nd Proviso to Article 311(2) of the Constitution of India is sustainable?”

The Court examined the order dated 04-03-2020 carefully and observed that it is evident that no reason whatsoever has been recorded as to why holding of the inquiry is not reasonably practicable. The only thing mentioned is that “it does not seem justified to conduct departmental inquiry at this stage”. The court is of the opinion that Article 311 of the Constitution has been insufficiently complied with.

Article 311 clearly states that authority is empowered to dismiss or remove a person or to demote him but the reasons as to why it’s not reasonably practicable to conduct an inquiry have to be recorded in writing. In the present case, no such reasons have been stated by the respondents.

In both the FIR’s where the petitioner has been accused, it has to be established beyond a reasonable doubt that the accused committed those acts and that the concerned police department left no stone unturned to unearth the truth.

The Court is of the opinion that both the cases cited by the respondent’s counsel are irrelevant in the present case’s perspective.

In view of all the above, the Court allowed the writ petition directing the reinstatement of petitioner along with consequential benefits. However, the respondent is free to initiate any departmental inquiry with respect to the petitioner’s misconduct.[Sarabjit Singh v. State of Punjab,  2020 SCC OnLine P&H 1404, decided on 01-09-2020]

Case BriefsSupreme Court

Supreme Court: In a 2:1 verdict, the 3-judge bench of Arun Mishra, MR Shah and Ajay Rastogi, JJ has held that the disciplinary authority has powers to impose the penalty of dismissal/major penalty upon the employee even after his attaining the age of superannuation if the disciplinary proceedings were initiated while the employee was in service in view of the Conduct, Discipline and Appeal Rules.

Issues before the Court

The Court was deciding the below mentioned issues and while all 3-judge agreed on the answer to the first Issue, Justice Rastogi, disagreed with the majority ruling in the second issue.

  • Issue 1: Whether is it permissible in law for the employer to withhold the payment of gratuity of the employee, even after his superannuation from service, because of the pendency of the disciplinary proceedings against him?
  • Issue 2: Where the departmental enquiry had been instituted against an employee while he was in service and continued after he attained the age of superannuation, whether the punishment of dismissal can be imposed on being found guilty of misconduct in view of Rule 34.2 of the Conduct, Discipline and Appeal Rules, 1978 (CDA Rules) made by Mahanadi Coalfield Limited?

Issue 1:

All 3 judges unanimously held it is permissible for the employer to withhold gratuity even after retirement/superannuation during pendency of the disciplinary proceedings as per Rule 34.3 of the CDA Rules.

Rule 34.3 of the CDA Rules permits withholding of the gratuity amount during the pendency of the disciplinary proceedings, for ordering recovering from gratuity of the whole or part of any pecuniary loss caused to the company if have been guilty of offences/misconduct as mentioned in subsection 6 of Section 4 of the Payment of Gratuity Act, 1972 or to have caused pecuniary loss to the company by misconduct or negligence, during his service. It further makes clear that Rule 34.3 for withholding of such a gratuity would be subject to the provisions of Section 7(3) and 7(3A) of the Payment of Gratuity Act, 1972 in the event of delayed payment in the case of an employee who is fully exonerated. There is no inconsistency between sub-section 6 of Section 4 of the Payment of Gratuity Act and Rule 34.3 of the CDA Rules.

Also, once it is held that a major penalty which includes the dismissal from service can be imposed, even after the employee has attained the age of superannuation and/or was permitted to retire on attaining the age of superannuation, provided the disciplinary proceedings were initiated while the employee was in service, sub-­section 6 of Section 4 of the Payment of Gratuity Act shall be attracted and the amount of gratuity can be withheld till the disciplinary proceedings are concluded.

Issue 2:

Justice Shah, for himself and Justice Mishra

The punishment which is prescribed under Rule 27 of the CDA Rules, minor as well as major, both can be imposed. Apart from that, recovery can also be made of the pecuniary loss caused as provided in Rule 34.3 of the CDA Rules, which takes care of the provision under  sub­section (6) of Section 4  of the Payment of Gratuity Act, 1972. The recovery is in addition to a punishment that can be imposed after attaining the age of superannuation. The legal fiction provided in Rules 34.2 of the CDA Rules of deemed continuation in service has to be given full effect.

Considering the provisions of Rules 34.2 and 34.3 of the CDA Rules, the inquiry can be continued given the deeming fiction in the same manner as if the employee had continued in service and appropriate punishment, including that of dismissal can be imposed apart from the forfeiture of the gratuity wholly or partially including the recovery of the pecuniary loss as the case may be.

“Several service benefits would depend upon the outcome of the inquiry, such as concerning the period during which inquiry remained pending. It would be against the public policy to permit an employee to go scot­free after collecting various service benefits to which he would not be entitled, and the event of superannuation cannot come to his rescue and would amount to condonation of guilt. Because of the legal fiction provided under the rules, it can be completed in the same manner as if the employee had remained in service after superannuation, and appropriate punishment can be imposed.”

Further, various provisions of the Payment of Gratuity Act, 1972 do not come in the way of departmental inquiry and as provided in Section 4(6) of Gratuity Act and Rule 34.3 of CDA Rules in case of dismissal gratuity can be forfeited wholly or partially, and the loss can also be recovered. An inquiry can be continued as provided under the relevant service rules as it is not provided in the Payment of Gratuity Act, 1972 that inquiry shall come to an end as soon as the employee attains the age of superannuation.

The Gratuity Act does not deal with the matter of disciplinary inquiry, it contemplates recovery from or forfeiture of gratuity wholly or partially as per misconduct committed and does not deal with punishments to be imposed and does not supersede the Rules 34.2 and 34.3 of the CDA Rules. The mandate of Section 4(6) of recovery of loss provided under Section 4(6)(a) and forfeiture of gratuity wholly or partially under Section 4(6)(b) is furthered by the Rules 34.2 and 34.3. If there cannot be any dismissal after superannuation, intendment of the provisions of Section 4(6) would be defeated.

Justice Rohatgi, dissenting

After conclusion of the disciplinary inquiry, if held guilty, indeed a penalty can be inflicted upon an employee/delinquent who stood retired from service and what should be the nature of penalty always depends on the relevant scheme of Rules and on the facts and circumstances of each case, but either of the substantive penalties specified under Rule 27 of the CDA Rules, 1978 including dismissal from service are not open to be inflicted on conclusion of the disciplinary proceedings and the punishment of forfeiture of gratuity commensurate with the nature of guilt may be inflicted upon a delinquent employee provided under Rule 34.3 of CDA Rules, 1978 read with sub­section (6) of Section 4 of the Payment of Gratuity Act, 1972.

[Chairman-­cum­-Managing Director, Mahanadi Coalfields Limited v. Rabindranath Choubey, 2020 SCC OnLine SC 470 , decided on 27.05.2020]

Case BriefsHigh Courts

Karnataka High Court: The Division Bench of L. Narayana Swamy, ACJ and P.S. Dinesh Kumar, J., allowed a writ appeal filed against order directing reinstatement of a driver in service, who had been not reported to duty for almost two years.

Respondent herein, who was working as a driver with Bengaluru Metropolitan Transport Corporation (BMTC), was suspended from service but suspension was revoked after sometime. Despite revocation of suspension, respondent did not report to duty and was issued a call notice. However, he still remained absent. Disciplinary authority framed and sent imputation of charges but the same was not reverted to by the respondent. A domestic enquiry was conducted after serving notice to respondent. Since he did not appear even in these proceedings, he was proceeded against ex-parte and dismissed from service. Respondent raised a dispute before the conciliation officer but upon failure of conciliation proceedings, he approached the Labour Court which dismissed the reference. In a writ petition filed before the learned Single Judge, the order of respondent’s dismissal was set aside. Aggrieved thereby, the instant petition was filed.

The Court observed that a High Court while exercising power under Article 227 of the Constitution of India, shall not ordinarily correct mere error of facts or law unless the error is shown to be apparent on the face of the record or is based on clear ignorance or utter disregard to the provisions of law. Further, a High Court shall not convert itself into a Court of appeal and indulge in re-appreciation of evidence unless great injustice is demonstrated.

It was noted that the petitioner chose not to report to duty even after two years of revocation of suspension. Relying on the judgment in North-Eastern Karnataka Road Transport Corporation v. Ashappa, (2006) 5 SCC 137 where it was held that remaining absent for a long time cannot be considered minor misconduct; it was held that the impugned order was not sustainable in law.[BMTC v. S. Ganesh, 2019 SCC OnLine Kar 243, Order dated 01-02-2019]

Case BriefsHigh Courts

Manipur High Court: A Single Judge Bench comprising of KH. Nobin Singh, J., dismissed an application filed for dismissal of Election Petition on the ground that it violates Section 100 of Representation of People Act, 1951 where grounds for declaration of election as void are given.

The applicant filed this application for dismissal of election petition filed by the respondent raising flaws in it. In the petition, the respondent contended that the applicant in his affidavit filed along with nomination paper had not given complete information. The applicant did not mention anything about the FIR filed against him. He also left many columns blank i.e. incomplete form and the Returning Officer could not have accepted the nomination. Whereas the applicant defended himself by stating that in one of the cases filed against him he had already been discharged. The allegation which the respondent had accused of were misconceived and unfounded which require strict proof. It was also submitted that RO of 4-Kshetrigao Assembly Constituency had accepted all nomination papers in the presence of respondent during which the respondent made no objection but now that he was not elected the same process had been put into scrutiny. The applicant opposed election petition on the ground that it does not contain material facts as required under Section 83(1)(a).

The High Court was of the view that Section 83(1)(a) which states that an election petition should contain material facts on which petitioner relies had been substantially complied with and election petition cannot be stopped at this stage. Therefore, the application was devoid of merit and was dismissed. [Nahakpam Indrajit Singh v. Md. Amin Shah,2018 SCC OnLine Mani 115, order dated 17-09-2018]

Case BriefsHigh Courts

Sikkim High Court: A Single Judge Bench comprising of Meenakshi Madan Rai, Acting CJ. dismissed a petition filed for condonation of 50 days delay in filing appeals against the order of Motor Accident Claims Tribunal whereby compensation was awarded to the claimants.

The MACT (West Sikkim) had awarded certain amount of compensation to the respondent claimants. The appeal was preferred thereagainst by the petitioner but only after a delay of 50 days. The petitioner filed the instant petition for condonation of such delay citing various reasons. The High Court, however, was not inclined to allow the petition and condone the delay. The High Court referred to the Supreme Court decision in Esha Bhattacharjee v. Raghunathpur Nafar Academy, (2013) 12 SCC 649. The following principles were, inter alia, reiterated by the High Court which is to be kept in mind while deciding a petition for condonation of delay:

  • Court to be satisfied that the appellant was prevented by sufficient cause in preferring the appeal on time.
  • Appellant had to put forth bona fide grounds for delay besides establishing that the delay was not caused due to negligence.
  • Length of delay is not a consideration. Each case is distinguishable from the next.
  • ‘Sufficient Cause’ should be given a liberal interpretation to ensure that substantial justice is done.
  • It has to be kept in mind that expiration of period of limitation gives rise to a right in favour of a decree-holder; this right is accrued should not be lightly disturbed.

In the instant case, the High Court held that in the gamut of facts and circumstances put forth for the delay, it was but relevant to opine that the petition was filed with a nonchalant attitude reflecting negligence, inaction and lack of bona fides, and being devoid of merits. The petition, thus, did not deserve indulgence of the Court. Consequently, the Court was not inclined to exercise jurisdiction in favour of the petitioner. Accordingly, the petition was dismissed. [Shriram General Insurance Co. Ltd. v. Dik Bir Damai,2018 SCC OnLine Sikk 190, Order dated 17-09-2018]

Case BriefsHigh Courts

Bombay High Court: Dismissing an appeal against the order of a probation committee, a Bench comprising of RM Savant and SV Kotwal, JJ. upheld the order of discharging a lower court Judge from service for reportedly turning up late at work on several occasions and violating other judicial norms. In this case, an anonymous complaint was received by the Registry of Court that the petitioner, who was a probationer Civil Judge Junior Division and Judicial Magistrate First Class at Ulhasnagar, was reporting to work late daily and beginning his court between 11.30 am -12 noon. Other allegations against him were that he used to chit chat with lawyers which thereby undermined the confidence of the litigants. It was also alleged that the petitioner discussed about other Judges in the presence of lawyers and carried out court work from his chamber.

Surprise checks were conducted based on the complaint and it was found that the petitioner was missing from work on the first day of the surprise check. It was also established that he was absent for 6 days each in the last 3 months. Subsequently, the Principal District Judge left disparaging remarks with regards to the conduct, character and integrity of the petitioner and he was subsequently dismissed. The petitioner’s lawyer contended that the comments made against her client were stigmatic in nature and were based on unsubstantiated allegations. She also stated that the petitioner was not given an opportunity of hearing to present his case before the probation committee.

After hearing arguments from both sides, the Court quoting the case of Gujarat Steel Tubes Ltd. v. Gujarat Steel Tubes Mazdoor Sabha, (1980) 2 SCC 593 held that having regard to the allegation or suspicion of misconduct that the master/employer may have against the probationer, the employer may not choose to hold an enquiry to discharge the probationer whom the employer is not desirous of keeping. The Court further stated that even if strong language was used by the Principal District Judge against the petitioner, the probation committee still did not find him suitable for continuation of service. [Girish Chandrakant Gosavi v. Chief Secretary, Law and Judiciary Department, 2018 SCC OnLine Bom 939, order dated 03-05-2018]

Case BriefsSupreme Court

Supreme Court: In the matter where a CRFP constable, who was dismissed from services for consuming liquor and quarrelling with civilians, had contended that the punishment was disproportionate, the Court held that when a member of the disciplined force deviates to such an extent from the discipline and behaves in an untoward manner which is not conceived of, it is difficult to hold that the punishment of dismissal as has been imposed is disproportionate and shocking to the judicial conscience.

In the present case the respondent had left the campus without prior permission, proceeded to the market, consumed liquor and quarrelled and the same had been proved. However, the respondent had contended that even if the charges have been proven, the punishment of dismissal in the obtaining factual matrix is absolutely harsh and shocking to the conscience.

Referring to the case of Union of India v. Dwarka Prasad Tiwari, (2006) 10 SCC 388, where it was held that unless the punishment imposed by the disciplinary authority or the appellate authority shocks the conscience of the court/tribunal, there is no scope for interference, the bench of Dipak Misra and N.V. Ramana, JJ said that as a member of the disciplined force, the respondent was expected to follow the rules, have control over his mind and passion, guard his instincts and feelings and not allow his feelings to fly in fancy. [Union of India v. Diler Singh, 2016 SCC OnLine SC 647, decided on 30.06.2016]