Full Judgment Text
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PETITIONER:
UNION OF INDIA
Vs.
RESPONDENT:
SARDAR BAHADUR
DATE OF JUDGMENT29/10/1971
BENCH:
ACT:
Civil Servant--Enquiry--Reliance on statements of witnesses
in a criminal case without calling witnesses--If
permissible.
Scope of enquiry--Interference by High Court on findings,.
Punishment imposed on basis that all charges proved--Finding
by Court that only some charges are proceed--Interference
with punishment imposed--Propriety.
Civil Services Conduct Rules, r. 13 (5)--’Likely to have
official dealings, scope of.
HEADNOTE:
After the respondent (a section officer in the Ministry of
Industry and Commerce) was acquitted in a criminal case an
enquiry under r. 15 of the Central Civil Services
(Classification, Control and Appeal) Rules, 1957, was held
against him on the basis of three. charges. Statements of
the witnesses in the criminal case were tendered in evidence
in the enquiry without calling the witnesses. The Inquiring
Officer rejected those statements and found that only the
third charge was proved and not the first two. The third
charge was that he borrowed a sum of money without obtaining
previous sanction of the Government and placed himself
tinder pecuniary obligation to the lender and thereby
contravened r. 13(5) of the Central Civil Services (Conduct)
Rules, 1955. The lender was the representative of a firm
which was an applicant for licences, and though the
application was made to a section in which the respondent
was not working, it would in due course have to be dealt
with by’ the section in which the respondent was working.
The Disciplinary Authority found that all the charges had
been proved and passed an order compulsorily retiring the
respondent from service.
A Single Judge of the High Court quashed the order and the
letters patent appeal filed by the State was dismissed.
In appeal to this Court, it was contended that the
statements rejected by the Inquiring Officer should have
been admitted, that all the three charges should have been
held to be proved and that the order of compulsory
retirement was justified.
HELD : (1) Tribunals should observe rules of natural justice
in the conduct of the inquiries, that is, no material can be
relied upon to establish a contested fact unless spoken to
by a witness who is subjected to cross-examination. In the
present case, the persons whose statements were sought to be
relied on were in station, but were not produced for cross-
examination by the respondent. They should have been
recalled, and tendered for cross-examination by the
respondent. The Inquiring Officer was therefore justified
in refusing to receive the statements as evidence.[223 A-D]
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M/s. Barailly Electricity Supply Co. Ltd. v. Workmen,
[1971] 2 S.C.R. 617 at 629 and State of Mysore v. S. S.
Makapur, [1963] 2 S.C.R. 943, 952, followed.
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(2)But the interference by the High Court with respect to
the third charge was not justified. [225 F-G]
The second part of r. 13(5) of the Civil Services Conduct
Rules forbids a civil servant from borrowing money from a
person with whom he is likely to have official dealings.
The words ’likely to have official dealings’ take within
their ambit the possibility of future dealings between the
officer concerned and the person from whom he borrowed the
money. In the present case, even if the applications were
dealt with at the initial stage by another section the
respondent should have known, that in due course, the
section in which be was working would have to deal with
them. Therefore, when he borrowed money a few days earlier
the respondent contravened the rule. [225 A-C]
(3) A disciplinary proceeding is not a criminal trial and
therefore the standard of proof required is that of
preponderence of probability and not proof beyond reasonable
doubt. If the inference that the lender was a person likely
to have official dealings with the respondent was one which
a reasonable person would draw from the proved ’facts of the
case, the High Court was wrong in sitting as a court of
appeal over a decision based upon it. The ’Letters Patent
Bench had the same power of dealing with all questions,
either of fact or of law arising in the appeal, as the
Single Judge of the High Court. It the enquiry was properly
held the question of adequacy or reliability of the evidence
cannot be canvassed before the High Court. A finding cannot
be characterised as per-verse or unsupported by any relevant
materials, if it was a reasonable inference from proved
facts. [225 D-G]
State of Andhra Prsdesh v. S. Sree Rama Rao, [1964] 3 S.C.R.
25, 33, followed.
Jugal Kishore Bhadani v. Union of india, A.I.R. 1965 Pat.
196, approved.
(4) If the order of the punishing authority could be
supported on any finding as to substantial misdemeanour for
which the particular punishment could be imposed it is not
for the court to consider whether the charge proved alone
would have weighed with the authority in imposing the
punishment. Therefore, the punishment of compulsory re-
tirement imposed was not liable to be quashed even though
the first two charges had not been proved.[226 G-H;227 A-C]
State of Orissa v. Bidyabhushan Mahapatra, [1963] Supp. I
S.C.R. 648, 666, followed.
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1758 of
1970.
Appeal by special leave from the judgment and order dated
April 20, 1970 of the Delhi High Court in Letters Patent
Appeal No. 75-D of 1966.
R. H. Dhebar, P. H. Parekh, S. P. Nayar and Urmila Kapoor,
for the appellant.
Mohan Behari Lal, for the respondent.
The Judgment of the Court was delivered by
Mathew, J. This is an appeal by Special Leave filed by the
Union of India from the judgment in appeal under clause 10
of
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Letters Patent of the Delhi High Court confirming the
decision of a learned Single Judge allowing Civil Writ No.
716-D of 1964 filed by the Respondent by quashing the order
made by the President on 23rd April, 1963 compulsorily
retiring the Respondent from service.
The Respondent, Shri Sardar Bahadur, was employed as a
Section Officer in the Ministry of Commerce and Industry in
the Steel & Cement Section (B) which along with other
sections like Industries Act and Industrial Policy etc. was
under the control of Shri P. S. Sundaram, Deputy Secretary
in that Ministry at that time.
In April, 1956, the Ministry invited applications for grant
of licences to set up steel re-rolling mills.
On June 14 1956, one Shri Nand Kumar representing Messrs Ram
Sarup Mam Chand and Messrs Mam Chand and Company of Calcutta
applied for five licences to set up steel re-rolling mills.
He also handed over on June 125, 1956 to the respondent a
cheque for Rs. 2,500/- drawn on the Punjab Co-operative Bank
Limited in favour of Shri P. S. Sundaram. The cheque was
certified by the bank as good for payment upto September 24,
1956. At the back of the cheque, there was a signature
which purported to be that of Shri P. S. Sundaram. It may
be noted at this stage that Shri P. S. Sundaram, the Deputy
Secretary had denied the signature to be his. Above the
signature the respondent wrote the words
"Please pay to Shri Sardar Bahadur.’
Lower down the respondent wrote the following
words
"Please collect and credit the amount into my
account. First payee’s endorsement may kindly
be guaranteed on my behalf and risk."
This cheque was duly cent to the account of the respondent
and the amount of Rs. 2,500/- was credited to his account in
the State Bank of India, New Delhi.
The respondent was prosecuted by the Special Police Esta-
blishment on the allegations that the amount covered by the
cheque was taken by him as illegal gratification for using
his official position illegally and in a corrupt manner in
order to procure licences for Messrs Ram Sarup Mam Chand of
Calcutta who bad filed applications in that behalf and that
the signature of Shri P. S. Sundaram had been forged by
him. The respondent was charged with offences punishable
under Section 5 (2) read with Section 5 (i) (d) of the
Prevention of Corruption Act, 1947 and
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Section 161, 467 and 471. of the Indian Penal Code. The
respondent was acquitted of all the charges on june 20,
1960. There after it was proposed to hold an ’inquiry
against him under Rule 15 of the Central Civil Services
(Classification, Control and Appeal) Rules, 1957 on the
basis of the following charges :-
1."That be failed to inform Shri P. S.
Sundaram Deputy Secretary, Ministry of
Commerce and Industry, New Delhi, that a
cheque for.Rs. 2,500/- in the name of Shri
Sundaram had been issued by Shri Nand Kumar of
Messrs Ram Sarup Main Chand and Messrs Main
Chand & Company of Calcutta, ’whose
applications for grant of licences for
establishing steel-re-rolling mills were
pending in the Ministry of Commerce and
Industry, as security in ’connection with the
said applications when he knew that no such
deposit. was to be made;
2. That he failed to inform Shri P. S.
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Sundaram that the said Shri Nand Kumar had
given him a cheque bearing Shri Sundaram’s
signature and bad asked him to deposit it in
his account. which he had done after asking
the bank (instead of showing the cheque first
to Shri Sundaram himself) to’ guarantee the
said signature of Shri Sundaram; and
3. That he borrowed a sum. of: Rs. 2,500/-
(the amount covered by the cheque referred,.to
above) from the said Shri Nand Kumar, without
obtaining previous sanction of the Government
and placed himself under pecuniary obligations
to the extent of Rs. 2,500/- and thereby also
contravened rule 13(5) of the Civil Services
(Conduct) Rules, 1955."
The enquiry was held and the Inquiry Officer found that the
first two charges were not proved as the identity of P. S.
Sundaram the payee of the cheque, had, not, been established
with Shri ’P. S. Sundaram Deputy Secretary.. But the
Inquiring Officer found that the. third charge has been
proved.
The findings of the Inquiring Officer on the first two
charges were not agreed to by the Deputy Secretary, Ministry
of External Affairs, exercising the powers of the President.
He found that all the charges had been proved. The
President after- consultation with the Union Public Service
Commission passed an order on April 22, 1968 holding that
the charge of gross misconduct and failure to ’Maintain
absolute integrity. and devotion to duty as a Government ’
servant had been substantially proved against the respondent
and imposing the penalty of compulsory ,retirement on him.
The respondent was directed to be retired from service With
immediate effect.
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it was this order which was quashed by the Single Judge in
the writ petition filed by the respondent. The Letters
Patent Appeal against the-order filed by the Union of India
before the Division Bench was dismissed.
it was contended on behalf of the appellant that the Inquiry
Officer went wrong in finding that charges Nos. 1 & 2 had
not been proved and that the President was right in holding
that these charges had been proved and therefore the High
Court should have found that charges Nos. 1 & 2 were proved,
as there was evidence to support the charges. It was
contended that the Inquiring Officer wrongly rejected the
copies of ’,he statements of the witnesses examined in the
original trial, which statements if admitted, would have
fully established the first two charges against the
respondent. Counsel for the appellant argued that the
provisions of the Evidence Act are not applicable to
disciplinary proceedings and therefore the statements of the
witnesses in the criminal trial ought to have been admitted
and relied on for establishing the guilt of the respondent
on the first two charges. Counsel relied on the following
observations of Venkatarama lyer,J.in Union of India v.
Varma(1)
"Now it is no doubt true that the evidence of
the Respondent and his witnesses was not taken
in the mode prescribed in the Evidence Act;
but that Act has no application to enquiries
conducted by Tribunal even though they may be
judicial in character. The law requires that
such Tribunals should observe rules of natural
justice in the conduct of the enquiry and if
they do so their decision is not liable to be
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impeached on the ground the procedure followed
was not in accordance with that which obtains
in a Court of law."
In M/s. Bareilly Electricity Supply Co. Ltd. v. The Workmen
and Others.(2) the scope of the above observation was
considered and this is what Jaganmohan Reddy, J. said:-
"But the application of principle-,of natural
justice does not imply that what is not
evidence can be acted upon. On the other hand
what it means is that no materials can be
relied upon to establish a contested fact
which are not spoken to by persons who are
competent to speak about them and are
subjected to cross-examination by the party
against whom they are sought to be used. When
a document is produced in a Court or a
Tribunal the questions that naturally arise
is, is it a genuine document, what are its
contents and are the statements contained
therein true."
(1) [1958] S.C.R. 499. (2) [1971] (2) S.C.C. 617 at 629
223
We do not think that the statements should have been
received in evidence as the appellant had taken no step to
produce the persons who made the statements for cross-
examination of the respondent. It was the duty of the
appellant to have produced the persons whose statements were
sought to be proved for the cross-examination of the
respondent. In State of Mysore v. S. S. Makapur(1), this
Court said that the purpose of an examination in the
presence of a party against whom an enquiry is made, is
sufficiently achieved, when a witness who has given a prior
statement is recalled, that statement is put to him, and
made known to the opposite party, and the witness is
tendered for cross-examination by that party. As the
persons whose statements were sought to be relied on were in
Delhi and as they were not produced and tendered for cross-
examination by the respondent, we think that the Inquiring
Officer was right in refusing to act upon the statements
relied on by the appellant. As there was no material before
the Inquiring Officer to. show that P. S. Sundaram mentioned
in the cheque is P. S. Sundaram, the Deputy Secretary, we
think the High Court was justified in holding that these
charges had not been proved.
Coming to charge No. 3 the Single Judge as well as the Divi-
sion Bench said that although there was great deal of
suspicion on the bona fides of the transaction in the
respondent borrowing money from Nand Kumar, suspicion cannot
take the place of proof. They, therfore, held that the
charge has not been proved. The third charge, as already
stated, was that the respondent borrowed Rs. 2,500/- from
Nand Kumar without obtaining the previous permission of the
Government and placed himself under a pecuniary obligation
to the extent of the amount and thus contravened the
provisions of Rule 13 (5) of the Central Civil Services
(Conduct) Rules 1955 which reads
"(5) No Government servant shall, save in the
ordinary course of business with a bank or a
firm of standing, borrow money from or
otherwise place himself under pecuniary
obligation to any person within the local
limits of his authority or any other person
with whom he is likely to have official
dealings, nor shall he permit any member of
his family, except with the previous sanction
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of the Government, to enter into any such
transactions :
Provided that a Government servant may accept
a purely temporary loan of small amount, free
of interest, from a personal friend or a
relative or operate a credit account with a
bona fide tradesmen."
(3) 1963(2) S.C.R. 943 at 952,
224
The Inquiring, Officer found that the respondent had borrow-
ed Rs. 2,500/- from Nand Kumar without obtaining the
previous permission as required by Rule 13 (5) and thereby
contravened the provisions of the sub-rule. The learned
Single Judge held that although it was proved that the money
was borrowed and the respondent placed himself under
pecuniary obligation to Nand Kumar , there’ was no evidence
nor had it been found either by the Inquiring Officer or by.
the President that Nand Kumar was a person with whom the
respondent was likely to have official dealings. He further
said that the evidence of Shri N. S. Satureman was quite
clear that application for licence of M/s Ram Sarup Mam
Chand was received in the Industries, Act Section which was
called I.A. (1) Section whereas the petitioner was working
in the Steel & Section where the copies of these appli-
cations started coming only in July 1956 and so in June 1956
when the cheque wag issued. it was not-.possible to see how
in the absence ’of any other evidence the petitioner could
he regarded as ’being in a position where Nand Kumar was-
likely to have any’ official, dealings with him in the
matter of the grant of the licences. The Division Bench
accepted this finding:
It may be noted that the fist part of the sub-rule 13 (5) of
the Central Civil.Service’s (Conduct) Rules 1955 says that
no Government servant shall borrow money from. or otherwise
place himself under a pecuniary obligation to any person
within the local limits of his authority, save in the,
ordinary. course of business with a bank or a firm of.
standing. The second part of the sub-rule. forbids him from
borrowing money fro any other person with whom he. is likely
to have official dealings. The appellant at no time had a
case that the respondent contravened the first part of the
sub-rule in borrowing the’ amount from Nand Kumar. So,
neither the learned Single Judge nor the Division Bench had
occasion to consider the application of the first part of
the sub-rule to the facts of the case. Even . in the
Special Leave Petition the appellant did not rely on the
first part of the subrule. We do not, therefore, think it.
necessary to consider the scope of the first part of the
sub-rule or its. application to the case here.
A finding cannot be characterised as perverse or unsupported
by any relevant materials if it is a reasonable inference
from proved facts. Now what are the proved facts : Nand
Kumar as representative of M/s Ram Sarup Mam Chand and M/s
Mam Chand and Company, of Calcutta filed five applications
for licences to set up steel re-rolling mills on 14-6-1956.
On 25-6-56, a cheque drawn in favour of P.’ S. Sundaram was
given to the respondent by Nand Kumar for Rs. 2,’500/-; the
cheque was endorsed and the amount credited in the account:
of the respondent. When the respondent borrowed the amount
in question from
225
Nand Kumar, he was not working in the Industries Act Section
Nand Kumar knew that the respondent was working in the Steel
& Cement Section of the Ministry and the applications for.
the grant of licences for setting up the steel plant re-
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rolling mills would go to that Section. Even if the
applications were to be dealt with at the initial stage by
the Industries Act Section the respondent at least was
expected to know that in due course the section in which he
was working had to deal with the same. This is borne out by
the fact that in July 1958 copies of the applications were
actually sent to the Steel & Cement Section where the res-
pondent was working. If he, therefore, borrowed money from
Nand Kumar a few days earlier it seems rather clear that he
placed himself under pecuniary obligation to a person who
was likely to have official dealings with him. The words
"likely to have official dealings" take within their ambit
the possibility of future dealings between the officer
concerned and the person from whom he borrowed money. A
disciplinary preceeding is not a criminal trial. The
standard proof required is that of preponderance of proba-
bility and not proof beyond reasonable doubt. If the
inference that Nand Kumar was a person likely to have
official dealings with the respondent was one which
reasonable person would draw from the proved facts of the
case, the High Court cannot sit as a court of appeal over a
decision based on it. Where there are some relevant
materials which the authority has accepted and which
materials may reasonably support the conclusion that the
officer is guilty, it is not the function of the High Court
exercising its jurisdiction under Art. 226 to review the
materials and to arrive at an independent finding on the
materials. If the enquiry has been properly held the
question of adequecy or reliability of the evidence cannot
’be convassed before the High Court (See State of Andhra
Pradesh v. S. Sreo Rama Rao(1). No doubt there was no
separate finding on the question whether Nand Kumar was a
verson likely to have official dealings with the respondent
by the Inquiring Officer or the President. But we think
that such .a finding was implied when they said that charge
No. 3 has been proved. The only question was whether the
proved facts of the case would warrant such an inference.
tested in’ the light of the standard of proof necessary to
enter a finding of this nature, we are satisfied that on the
material facts proved the inference and the implied finding
that Nand Kumar was a person likely to .have official
dealings with the respondent were reasonable.
The Division Bench said that the conclusion of the Single
Judge that there was no evidence before the Inquiring
Officer that Nand Kumar was likely to have official dealings
with the respondent was not wholly unwarranted, and there
are limits, to as
(1) [1964] 3 S.C.R. 25 at 33,
226
the powers exercised by a Single Judge under Article 226 of
the Constitution, there are limits to the powers of a
Division Bench while sitting in appeal over the judgment of
a Single Judge. If the inference that Nand Kumar was a
person likely to have official dealings with the respondent
was in the circumstances of the proved facts in the case a
reasonable one, we do not think there was anything which
prevented the Division Bench from interfering with the order
of the Single Judge. In Jugal Kishore Bhadani v. Union of
India(1), the Court observed:-
"It is well established principle of law that
unless the statute oherwise provides an
appellate Court has the same power of dealing
with all questions, either of fact or of law,
arising in the appeal before it, as that of
the Court whose judgment is the subject of
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scrutiny in the appeal."
The respondent contended that he did not borrow Rs. 2,500/-
from Nand Kumar. His case was that Nand Kumar owed him Rs.
500/- and that when he gave the cheque to the respondent it
was on the understanding that Rs. 2,000/- would be repaid to
him and that was done immediately. The respondent produced
a receipt executed by Nand Kumar for having received Rs.
2,000/-, but Nand Kumar was not examined to prove the genui-
neness of the receipt. The Inquiring Officer has considered
the question at length in his report and he came to the
conclusion that the case of the respondent that he did not
borrow Rs. 2,500/from Nand Kumar cannot be accepted. The
learned Single Judge found that the petitioner had borrowed
the amount of Rs. 2,500/- from Nand Kumar. That finding was
endorsed by the Division Bench. As it was a reasonable
inference from materials before the Inquiring Officer that
Nand Kumar was a person likely to have official dealings
with the respondent and since the respondent borrowed money
from such a person without the permission of Government, the
finding of the Inquiring Officer and the President that the
respondent had contravened Rule 13(5) of the Central Civil
Services (Conduct) Rules, 1955 should not have been
interfered with by the High Court.
It may be recalled that the punishment of compulsorily
retirement was imposed upon the respondent on the basis that
all the three charges had been proved against him. Now, it
is found that only the third charge has been proved. The
question then is whether the punishment of compulsorily
retirement imposed by the President can be sustained even
though the first two charges have not been proved.
(1) A.I.R. 1965 Patna 196,
227
Now it is settled by the decision of this Court in State of
Orissa v. Bidyabhushan Mohapatra(1) that if the order of a
punishing authority can be supported on any finding as to
substantial misdemeanour for which the punishment can be
imposed, it is not for the Court to consider whether the
charge proved alone, would have weighed with the authority
in imposing the punishment. The Court is not concerned to
decide whether the punishment imposed, provided it is
justified by the rules, is appropriate having regard to the
misdemtanour established.
We reverse the judgment under appeal and hold that order of
the President imposing the punishment of compulsorily
retirement was not liable to be quashed.
In the result, the appeal is allowed, but in the
circumstances, there will be no order as to costs.
V.P.S. Appeal allowed.
(1) [1963] Supp. 1 S.C.R. 648 a 666.
228