Full Judgment Text
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CASE NO.:
Appeal (civil) 1997 of 2007
PETITIONER:
Coal India Ltd. & Ors
RESPONDENT:
Saroj Kumar Mishra
DATE OF JUDGMENT: 17/04/2007
BENCH:
S.B. Sinha & Markandey Katju
JUDGMENT:
J U D G M E N T
[Arising out of S.L.P. (C) No. 15805 of 2006]
WITH
CIVIL APPEAL NO.1998/2007 @ S.L.P.(C)No. 16569 of 2006
S.B. SINHA, J.
Leave granted.
These two appeals involving similar questions of law and facts were
taken up for hearing together and are being disposed of by this common
judgment.
Respondents herein were employees of Mahanadi Coalfields Ltd., a
Government Company within the meaning of Section 617 of the Companies
Act. Coal India Limited admittedly is the holding company of Mahanadi
Coalfields Ltd. Appellant No. 1 framed rules laying down terms and
conditions of service of its Executive Officers. The Executive Cadre of the
Officers of Appellant No. 1 is divided in various grades namely Gr. E/1 to
Gr. E/8. Indisputably, promotion from A/3 to A/4 grades is governed by the
rule of Seniority-Cum-Merit. For the purpose of considering the cases for
promotion of the eligible officers from Grade E/3 to E/4, a departmental
promotion committee held its meeting in April-May, 1999.
Respondents were, however, not promoted inter alia on the premise
that the General Manager (Vigilance) of the Mahanadi Coalfields Ltd.
intimated to the concerned authority that vigilance cases were pending
against them. Orders of promotion were issued in favour of the officers who
were admittedly junior to them on 31.8.1999. When despite representation,
they were not promoted on the ground of pendency of vigilance cases, they
filed writ petitions before the Orissa High Court praying inter-alia for
notional promotion with effect from the date their juniors were promoted.
During pendency of the Writ Petitions namely in June, 2002, charge
sheets were issued and upon a disciplinary proceeding having been initiated,
a penalty of reduction of pay by one stage for a period of one year without
cumulative effect was imposed upon the respondents in July, 2003.
Before the Orissa High Court as also before this Court, reliance has
been placed by the appellants on office memorandums dated 19/27th June,
1979. Upon taking into consideration the said office memorandum as also
subsequent memorandums and in particular the one dated 8.1.1981, the High
Court held;
"15. Taking into consideration of the entire factual
matrix of the case and keeping in view the ratio
decided by the Apex Court in different cases, so far
as the present petitioner is concerned, the ratio
decided in the case of Union of India Vrs. K.V.
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Jankiraman and Union of India-Vrs.-Dr.(Smt.)
Sudha Salhan has to be followed and since the
concerned employees in the cases of Delhi
Development Authority-Vrs. H.C. Khurana (AIR
1993 S.C. 1488), Union of India \026vrs.-Kewal Kumar
(AIR 1993 SC 1585) and Union of India \026vrs- R.S.
Sharma (AIR 1993 S.C. 2337) stand on a different
footing than the present petitioner, the ratio decided
in those cases cannot be followed in the case of the
present petitioner. In the case of R.S. Sharma the
order of the Tribunal directing to open the sealed
cover and giving effect to the recommendation made
by the DPC on the ground of non-service of charge
memo, was set aside keeping in view the
Rules/Circulars/O.M. in force more particularly
clause-iv of the O.M. wherein it is provided that
during the pendency or "investigation on serious
allegation of corruption, bribery or similar grave
misconduct is in progress either by the CBI or any
agency, departmental or otherwise", sealed cover
procedure can be resorted to till the proceeding is
over in all respect. But in the instant case on the
basis of O.M./Circular/Rules followed by the
MCL/Coal India, the sealed cover was opened and
the petitioner was given promotion to next higher
grade (Grade-4) since the so called investigation was
not completed within two years from the date the
immediate junior to the petitioner was promoted.
This particular office memorandum has been issued
may be with the intention to check prolonged
enquiry covering a period of more than two years in
respect of certain allegations against an employee,
so that the concerned employee shall not be harassed
or debarred from getting benefit on the
recommendation of DPC for an indefinite/prolonged
period on the ground of pendency of such enquiry,
without initiation of a departmental proceeding after
service of charge memo. However once the sealed
cover is opened and the petitioner is allowed the
benefit of the recommendation of DPC by giving
him promotion to the next higher grade, he shall be
entitled for all consequential benefits from the date
his immediate junior got the same. In this case the
petitioner had never been suspended during the
period of the so-called preliminary enquiry nor
during the period of departmental enquiry. As such,
he shall be entitled for promotion notionally with
effect from the date his immediate junior got the
same along with all service and financial benefit."
On the said findings, the writ petitions were allowed.
Mr. Ajit Kumar Sinha, learned counsel appearing on behalf of the
appellant took us through the said office memorandum dated 27.6.1979 and
submitted that as in terms thereof pendency of a vigilance or departmental
action would itself be sufficient for not promoting the officer who would, in
the event of their complete exoneration would be promoted as and from the
date his immediate junior has been promoted; the impugned judgment
cannot be sustained. The High Court, Mr. Sinha submitted, committed
manifest error in invoking the sealed cover procedure which is not
applicable to the fact of the present case. If the impugned judgment is
upheld, a flood-gate of litigation would ensue. Strong reliance in this behalf
has been placed by Mr. Sinha on a reported decision of this case in Manoj
Kumar Singh v The Coal India Ltd. & Ors. in Civil Appeal No. 17 of 2005
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disposed of on 2.1.2006 as also on State of Madhya Pradesh v. Srikant
Chaphekar [1992 (4) SCC 689].
Mr. Janaranjan Das, learned counsel appearing on behalf of the
respondent, on the other hand, supported the judgment of the High Court.
The factual matrix involved in the matter being not in dispute, the
only question which falls for our consideration is interpretation of the office
memorandums dated 27.6.1979 and 8.1.1981.
Both First Appellant as also Mahanadi Coalfields Ltd. are ’State’
within the meaning of Article 12 of the Constitution of India. Their action
must, therefore, satisfy the test of reasonableness and fairness. Although an
employee of a State is not entitled to promotion to a higher post as a matter
of right, he is entitled to be considered therefor in terms of Article 16 of the
Constitution of India. A right of promotion can be withheld or kept in
abeyance only in terms of valid rules. Rules operating in the field do not
provide that only because some allegations have been made as against an
officer of the company, the same would itself justify keeping a valuable right
to be considered for promotion of an employee in abeyance. When a
question of that nature comes up for consideration before a superior court,
the extant rules operating in the field must necessarily be construed in the
light of the constitutional scheme of equality.
The office memorandum dated 19/27 June 1979 reads as under:-
"The issue relating to procedure to be followed with
regard to promotion of an officer who has been kept
under suspension and/or against whom a
vigilance/departmental action is pending has been
engaging the attention of the management for some
time past. Taking into consideration the extant rules
and orders of the Government of India in this regard the
following decision has been taken:
a) All orders for promotion will be issued only
after vigilance clearance.
b) *
c) When an officer has been completely
exonerated and he is subsequently promoted, his
seniority should be fixed as if he had been promoted in
accordance with the position assigned to him in the
select list. Period of his eligibility for consideration for
promotion to the next higher grade should be reckoned
with reference to the date his immediate junior has been
promoted. The pay of such an executive on promotion
should be fixed notionally by allowing the intervening
period during which the officers could not be promoted
due to his suspension and/or pending departmental
enquiry to be counted for increments in the higher
grade but no arrears would be admissible to him.
(Corrected as per No. C-5(A)/50972 (Vol.1) Pt./1507
dated 10.07.1979)."
The said office memorandum was, however, clarified by a subsequent
memorandum dated 8.1.1981 wherein it was laid down
"It has been laid down in CIL O.M. number quoted
above that all orders for promotions will be issued only
after vigilance clearance. The stage at which a
vigilance enquiry should affect the promotion,
confirmation et. Of an employee of CIL and its
subsidiaries has not been clearly defined in the above.
Quoted office memorandum. Vigilance inquiries take
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considerable time to complete and in absence of a clear
indication regarding the point at which such inquiries
should stand in the ay of an officer’s promotion, there is
scope for confusion on this score. This matter has been
engaging the attention of the management for quite
some time. Taking into consideration the existing
orders of the Government of India in this regard, the
following decision has been taken.
"All orders for promotions will be issued only after
vigilance clearance. However, vigilance clearance
shall not be withheld for the mere fact that a P.E. or
R.C. has been registered by the CBI against an officer
or that complaints are being looked into a preliminary
enquiry departmentally but no conclusion has been
reacted about the prima facie guilt of the officer.
Vigilance clearance shall be withheld only when :
1) In the case of a Preliminary Enquiry, either by
the CBI or departmental agencies, the competent
authority, on consideration of the results of the
investigation, has formed the opinion that a charge-
sheet may be issued on specific imputations for
departmental action, and
2) In case of a regular case, the competent
authority has decided to accord saction for prosecution
of the officer in Court.
Until the competent authority arrives at such a
conclusion, the officer may be treated at par as per with
orders in the matter of promotion, confirmation etc.
These instructions shall come into force with
immediate effect."
It is not the case of the appellants that pursuant to or in furtherance of
the complaint received by the vigilance department, the competent authority
had arrived at a satisfaction as is required in terms of the said circulars that a
charge sheet was likely to be issued on the basis of a preliminary enquiry
held in that behalf or otherwise.
The circular letters issued by the appellants put restrictions on a
valuable right of an employee. They therefore, are, required to be construed
strictly. So construed there cannot be any doubt whatsoever that the
conditions precedent contained therein must be satisfied before any action
can be taken in that regard.
We may also notice that a revised guideline was also issued on or
about 14.5.2002, wherein it was stated;
"the Vigilance clearance shall be withheld only
on the ground (a) when officer is under
suspension (b) when the officer, in respect of
whom a charge sheet has been issued and
disciplinary proceedings are pending; and (c)
when an officer in respect of whom prosecution
for a criminal charge is pending."
The said circular although is not ipso facto applicable in this case,
clearly laws down the law otherwise prevailing.
Reliance placed by Mr. Sinha on Manoj Kumar Singh (supra) is
wholly misplaced. Therein no law was laid down. It does not contain any
ratio decidendi. The question as to whether in absence of any chargesheet or
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at least in absence of any satisfaction having been arrived by the disciplinary
authority that a prima facie case has been made out for proceeding against an
employee, the Vigilance clearance can be given or not, did not fall for
consideration at all therein. No issue in that behalf was framed; no argument
was advanced; no reason has been assigned in support of the said order.
This Court merely stated;
"In the present case, the decision to take action
against the appellant had been formed on
20.1.99. Therefore, the appellant could not have
been granted vigilance clearance. In the
circumstances, we see no reason to interfere with
the order under challenge. The appeal is,
accordingly, dismissed. There shall be no order
as to costs."
It is surprising that although the appellant is a ’State’ within the
meaning of Article 12 of the Constitution of India, it failed even to be fair to
this Court inasmuch as the subsequent office memorandum dated 8.1.1981
and/or 14.5.2002 were not brought to its notice. Had the subsequent office
memorandums and in particular the one dated 8.1.1981 been brought to the
notice of the Court, we have no doubt in our mind that the terms of the
order passed in Manoj Kumar Singh (supra) would have been different.
Similarly, reliance placed on Srikant Chaphekar (supra) by Mr. Sinha,
is equally mis-placed. Therein a Departmental Promotion Committee
considered the adverse remarks passed against the employee concerned. In
this case, a departmental promotion committee did not take into
consideration the case of the respondents at all. They were indisputably
entitled to be considered for promotion having regard to the rule of
seniority-cum-merit. Although, in the said rule, merit has some role to play,
but the promotion would not be based only on merit.
See State of Kerala and Another v N.M. Thomas and Others [AIR
1976 SC 490], E.V. Chinnaiah v State of Andhra Pradesh & Ors [(2005) 1
SCC 394], Bhagwandas Tiwari and Ors. v Dewas Shajapur Kshetriya
Gramin Bank and Ors. [2006 (11) SCALE 593], B.V. Sivaiah and Ors. v K.
Addanki Babu and Ors. etc. [(1998) 6 SCC 720].
A departmental proceeding is ordinarily said to be initiated only when
a chargesheet is issued.
The floodgate argument also does not appeal to us. The same appears
to be an argument of desperation. Only because, there is a possibility of
floodgate litigation, a valuable right of a citizen cannot be permitted to be
taken away. This Court is bound to determine the respective rights of the
parties.
See Zee Telefilms Ltd. and Anr. v Union of India and Ors. [(2005) 4
SCC 649], Guruvayoor Devaswom Managing Committee and Anr. v C.K.
Rajan and Ors. [(2003) 7 SCC 546].
Even, in such a case, the Employer is not in a helpless situation.
Despite such promotion if the delinquent employee has suffered punishment,
subsequently appropriate steps may be taken on the basis thereof.
We, therefore, are of the opinion that there is no infirmity in the
impugned judgments. The appeals being wholly without merits, are
dismissed with costs. Counsel’s fee assessed at Rs. 50,000/-.