Full Judgment Text
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CASE NO.:
Appeal (civil) 513 of 2008
PETITIONER:
U.P. STATE SUGAR CORPORATION LTD. & Ors.
RESPONDENT:
KAMAL SWAROOP TONDON
DATE OF JUDGMENT: 18/01/2008
BENCH:
C.K. THAKKER & P. SATHASIVAM
JUDGMENT:
J U D G M E N T
(Arising out of SLP (c) Nos. 11599 of 2006)
C.K. Thakker, J.
1. Leave granted.
2. The present appeal is filed against
the judgment and order passed by the High
Court of Judicature at Allahabad (Lucknow
Bench) on February 24, 2006 in Writ Petition
No. 484 (S/B) of 2000.
3. Necessary facts giving rise to the
appeal are that the respondent herein was
serving with the appellant- U.P. State Sugar
Corporation Ltd. (\023Corporation\024 for short) as
Resident Engineer at the Head Office of the
Corporation at Lucknow. On January 13, 2000,
a show cause notice was issued to him stating
therein that a work was allotted to M/s Gupta
& Co., Dehradoon for construction of
residential houses in Saharanpur. The
Contractor had given two Fixed Deposit
Receipts (FDRs) towards the security for the
work to be done. The details of FDRs were
given in the notice. It was alleged that the
Corporation suffered loss of Rupees one lakh
due to lack of precaution, irregularity, gross
negligence and carelessness by the respondent.
The respondent was, therefore, called upon to
submit explanation within three days why
disciplinary action should not be taken
against him. On January 15, 2000, the
respondent submitted his reply denying the
allegations and contending that he had not
committed any illegality and there was no
justification to ask for his explanation. The
Corporation was not satisfied with the reply
filed by the respondent and decided to hold
departmental inquiry against him. On January
31, 2000, therefore, show cause notice was
issued to the respondent for the losses caused
to the Corporation due to negligence and
carelessness on the part of the respondent.
It may be noted at this stage that the
respondent retired on attaining the age of
superannuation (60 years) on the same day,
i.e. January 31, 2000. According to the
respondent, since he retired from service on
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January 31, 2000, no proceedings could have
been initiated against him and issuance of
show cause notice which was received by him
after office hours at 6.45 p.m. on January 31,
2000 was illegal as there was no relationship
of employer and employee between the
Corporation and him. He, therefore, filed a
writ petition in the High Court of Allahabad
at Lucknow Bench on April 11, 2000. In the
petition a prayer was made for quashing
charge-sheet and departmental proceedings.
During the pendency of the petition, however,
two orders came to be passed against the
respondent on March 24, 2001 and April 26,
2005. By the first order of March 24, 2001,
an amount of Rupees one lakh was ordered to be
recovered from the respondent as the
Corporation suffered loss of the said amount
which was ordered to be adjusted from the
gratuity of the respondent. By the second
order dated April 26, 2005, an amount of
Rs.73,235-50ps which was = portion of the
amount of Rs.1,46,471.00ps was directed to be
recovered as loss had been caused to the
Corporation due to negligence of the
respondent. The respondent sought amendment in
the petition and challenged the above two
orders as well.
4. The High Court, by the impugned order,
allowed the writ petition holding that the
order dated January 31, 2000 commencing
disciplinary inquiry against the writ
petitioner was illegal as he had retired on
that day. No proceedings, hence, could have
been initiated against him. Consequently,
orders passed in 2001 and 2005 could not have
been made and they were liable to be quashed.
The Corporation was directed to pay to the writ
petitioner all the benefits of gratuity, leave
encashment and other dues payable to him with
interest @ 8% p.a. from the date of retirement
till the date of actual payment. Being
aggrieved by the order passed by the High
Court, the Corporation has approached this
Court.
5. On July 28, 2006, notice was issued by
this Court. Since contempt proceedings were
initiated by the writ petitioner in the
meantime, who succeeded before the High Court,
this Court stayed those proceedings. Counter-
affidavit and affidavit-in-rejoinder were filed
thereafter and the matter was ordered to be
placed for final hearing. That is how the
matter has been placed before us.
6. We have heard the learned counsel for
the parties.
7. The learned counsel for the appellant-
Corporation contended that the High Court was
wholly wrong in quashing departmental
proceedings and consequential orders passed by
the authorities which were legal, valid and in
consonance with law. It was submitted that
show cause notice was issued on January 13,
2000 well in time before the writ petitioner
retired asking for an explanation as to why
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proceedings should not be initiated against
him. It was further submitted that even
charge-sheet was issued on January 31, 2000
and it was within power of the Corporation to
issue such charge-sheet and the High Court
ought not to have set aside the inquiry
proceedings and consequential orders. It was
urged that it is settled law that relationship
of employer and employee continues to remain
so long as all retiral benefits have not been
paid to the employee. Since the amount of
gratuity, leave encashment and other
pensionary benefits were yet to be paid to the
employee, the tie continued and proceedings
initiated against the writ petitioner were in
accordance with law and should not have been
interfered with. That apart, under the U.P.
State Sugar Corporation Ltd. General Service
Rules, 1988 (hereinafter called \023the Rules\024),
such proceedings could have been initiated
even after an employee has retired since they
related to the recovery of losses caused to
the Corporation by the respondent-employee.
Since the present proceedings were for
recovery of loss caused to the Corporation,
such an action could have been taken under the
Rules and the High Court was wrong in holding
that the proceedings could not have been held.
Finally, it was submitted that it was the case
of the Corporation that because of acts and
omissions of the respondent-employee, loss had
been caused to the Corporation. When the
amount of loss was sought to be recovered from
the employee, the High Court ought not to have
exercised discretionary and equitable
jurisdiction under Article 226 of the
Constitution and on that count also, the
impugned action deserves to be set aside. On
all these grounds, it was submitted that the
impugned order of the High Court is liable to
be set aside and the writ petition filed by
the writ-petitioner should be ordered to be
dismissed by allowing the appeal.
8. The learned counsel for the
respondent, on the other hand, supported the
order of the High Court. He submitted that
the date of issuance of show cause notice was
totally irrelevant. Charge-sheet was issued
only on January 31, 2000 and a finding was
recorded by the High Court that it was
received by the respondent after office hours
of January 31, 2000. By the time, the tie was
broken and there was no relationship of
employer and employee between the Corporation
and the writ-petitioner. No departmental
proceedings, therefore, could have been
initiated against the writ-petitioner and they
were liable to be quashed. When the
proceedings were without jurisdiction, orders
passed in 2001 and 2005 which were
consequential, were obviously without power,
authority or jurisdiction on the part of the
Corporation in passing them. The High Court
was, therefore, fully justified in quashing
those orders also. Since the order passed by
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the High Court is legal, valid and proper, it
calls for no interference by this Court and
the appeal deserves to be dismissed.
9. From the facts noted above, it is
amply clear that two orders which were passed
against the respondent-employee related to
recovery of certain amount from the
respondent-employee on the ground that there
was carelessness, negligence or omission on
his part in the discharge of his duties which
resulted in loss to the Corporation. By the
order dated March 24, 2001, an amount of
Rupees one lakh which was financial loss
suffered by the Corporation was ordered to be
adjusted against the gratuity of the employee.
Likewise, by order dated April 26, 2005, an
amount of Rs.73,235.50 p. [= of
Rs.1,46,471.00] was ordered to be adjusted
against the amount of gratuity and encashment
of earned leave which was also the financial
loss suffered by the Corporation as a result
of negligence of the respondent. It is in the
light of the above facts that we have to
consider whether such an action could have
been taken against the respondent-employee by
the appellant-Corporation.
10. The learned counsel for the appellant
is right when he submitted that show cause
notice was issued to the respondent-employee
on January 13, 2000 when he was very much in
service. The respondent submitted his
explanation on January 15, 2000 which was not
found to be satisfactory. A regular show
cause notice was, therefore, issued by the
Corporation on January 31, 2000 and was served
upon the respondent-employee on the same day.
The notice was also sent by registered post
which was received by the employee on February
11, 2000. But it is clear from the documents
that show cause notice was issued and replied.
A regular show cause notice as to departmental
inquiry was also served upon the respondent-
employee on the last day of his service which
was January 31, 2000. In our opinion,
therefore, it could not be said that the
proceedings had been initiated against the
respondent-employee after he retired from
service.
11. Now it is well settled that retiral
benefits are earned by an employee for long
and meritorious services rendered by him/her.
They are not paid to the employee gratuitously
or merely as a matter of boon. It is paid to
him/her for his/her dedicated and devoted
work.
12. In Garment Cleaning Works, Bombay v.
Wokmen, AIR 1962 SC 673, the relevant clause of
the Gratuity Scheme provided that if a workman
was dismissed or discharged for misconduct
causing financial loss to the employer,
gratuity to the extent of loss should not be
paid to the workman concerned. It was contended
on behalf of the employer that the retrenchment
benefit and gratuity were payable to the
employee for his long and meritorious services
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and if he was dismissed by misconduct, he would
not be entitled to claim retrenchment benefits
or gratuity and the benefits could be denied to
him.
13. Dealing with the argument and the
basis of payment of gratuity, this Court,
speaking through P.B. Gajendragadkar, J. (as
His Lordship then was), said:
\0235. On principle if gratuity is earned
by an employee for long and
meritorious service it is difficult to
understand why the benefit thus earned
by long and meritorious service should
not be available to the employee even
though at the end of such service he
may have been found guilty of
misconduct which entails his
dismissal. Gratuity is not paid to the
employee gratuitously or merely as a
matter of boon. It is paid to him for
the service rendered by him to the
employer, and when it is once earned
it is difficult to understand why it
should necessarily be denied to him
whatever may be the nature of
misconduct for his dismissal. Then, as
to the definition of retrenchment in
the Industrial Disputes Act, we are
not satisfied that gratuity and
retrenchment compensation stand
exactly on the same footing in regard
to the effect of misconduct on the
rights of workmen. The rule of the
provident fund scheme shows not that
the whole provident fund is denied to
the employee even if he is dismissed
but it merely authorises certain
deductions to be made and then too the
deductions thus made do not revert to
the employer either. Therefore we do
not think that it would be possible to
accede to the general argument that in
all cases where the service of an
employee is terminated for misconduct
gratuity should not be paid to him. It
appears that in award which framed
gratuity schemes sometimes simple
misconduct is distinguished from gross
misconduct and a penalty of forfeiture
of gratuity benefit is denied in the
latter case but not in the former, but
latterly industrial tribunals appear
generally to have adopted the rule
which is contained in clause (ii)(b)
of the present scheme. If the
misconduct for which the service of an
employee is terminated has caused
financial loss to the works, then
before gratuity could be paid to the
employee he is called upon to
compensate the employer for the whole
of the financial loss caused by his
misconduct, and after this
compensation is paid to the employer
if any balance from the gratuity
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climbable by the employee remains that
is paid to him.\024. (emphasis supplied)
14. In Calcutta Insurance Co. Ltd. v.
Workmen, (1967) 2 SCR 596, this Court
considered the concept of gratuity. It referred
to Garment Cleaning Works and other cases. It
noted that the opinion expressed in those cases
was that gratuity was earned by an employee for
\023long and meritorious service\024 and consequently
it must be given to him even though at the end
of such service, he may have been found guilty
of misconduct entailing his dismissal.
15. The Court then said;
\023In principle, it is difficult to
concur in the above opinion. Gratuity
cannot be put on the same level as
wages. We are inclined to think that
it is paid to a workman to ensure good
conduct through out the period he
serves the employer. "Long and
meritorious service" must mean long
and unbroken period of service
meritorious to the end. As the period
of service must be unbroken, so must
the continuity of meritorious service
be a condition for entitling the
workman to gratuity. If a workman
commits such misconduct as causes
financial loss to his employer, the
employer would under the general law
have a right of action against the
employee for the loss caused and
making a provision for withholding
payment of gratuity where such loss
caused to the employer does not seem
to aid to the harmonious employment of
labourers of workmen. Further, the
misconduct may be such as to undermine
the discipline in the workers - a case
in which it would be extremely
difficult to assess the financial loss
to the employer.\024 (emphasis supplied)
16. In M. Narasimhachar v. State of
Mysore, AIR 1960 SC 247, an amount of
Rs.5,215/- was deducted from pension of the
Government servant. The action was challenged
by the employee. Considering the relevant
provisions of the Rules, this Court held that
the Government had reserved to itself the
right to order the recovery from pension and
compassionate allowances of the Government
servant of any amount on account of losses
found to have been caused to Government by
negligence or fraud of such officer during his
service.
17. Again, in Jarnail Singh v. Secretary,
Ministry of Home Affairs & Ors., (1993) 1 SCC
47 JT 1992 Supp SC 489, this Court considered
the provisions of Central Civil Services
(Pension) Rules, 1972. The definition of
\021pension\022 included gratuity under Rule 3.
Rule 9 conferred on the President power to
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withhold or withdraw pension in certain
circumstances. An order was passed against an
employee withholding pension and the entire
amount of death-cum-retirement gratuity
otherwise admissible to him. The direction
was given on account of serious irregularities
found to have been committed by the workman.
The workman challenged that order
unsuccessfully and thereafter approached this
Court. His contention was that an amount of
gratuity could not have been withheld.
18. Negativing the contention, this Court
held that the power to withhold gratuity was
conferred on the President and such action
could not be said to be illegal. It was ruled
that the Government could adjust its dues
against the amount of death-cum-retirement
gratuity otherwise payable to Government
servant.
19. In State of Uttar Pradesh v. Brahm
Datt Sharma & Anr., (1987) 2 SCC 179 : JT 1987
(1) SC 571, this Court held that it was open
to Government to reduce, forfeit, withhold or
recover pension, after affording hearing to
the affected person, on ground of
unsatisfactory service based on proved
findings of serious misconduct or causing
pecuniary loss to the Government. Such
proceedings can be initiated even after
retirement for misconduct, negligence or
financial irregularity. Where Government
servant was found guilty of misconduct or
negligence resulting in financial loss to the
Government, it was competent to the Government
to direct reduction in pension.
20. Interpreting Article 470 of U.P. Civil
Service Regulations, this Court observed that
the said provision stated that full pension
would not be awarded as a matter of course to
a Government servant on his retirement. It
was awarded to him if service rendered by him
was satisfactory. In case of absence of
\021thoroughly satisfactory\022 service, the
authority was competent to reduce the amount
of pension. Referring to Deokinandan Prasad v.
State of Bihar, 1971 Supp SCR 634, State of
Punjab v. K.R. Erry, (1973) 2 SCR 405 and D.S.
Nakara v. Union of India, (1983) 2 SCR 165,
the Court held that pension was not a \021bounty\022
and an employee was entitled to pensionary
benefits, but proceeded to state that a
Government employee would earn pension by
rendering long and efficient service.
Considering Narasimhachar, the Court held that
the employer had right to reduce pension of an
employee if services rendered by him were
found to be unsatisfactory. Only thing is that
in such cases before taking any action,
principles of natural justice must be
observed.
21. In State of Maharashtra v. M.H.
Mazumdar, (1988) 2 SCC 52 : JT 1988 (1) SC
432, the Court held that departmental inquiry
can be instituted against a Government servant
after superannuation and pension can be
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reduced on proved charges of misconduct,
negligence or financial irregularity committed
during the period of service. Following
Narasimhachar and Brahm Datt Sharma, and
distinguishing B.J. Shelat v. State of
Gujarat, (1978) 2 SCC 202, the Court held that
when financial loss was caused to the
Government by any act or omission on the part
of its employee, the purpose of inquiry was
not to inflict any punishment, but to
determine the pension of an employee. Such an
action, in our view, can be taken so that the
Government may not have to suffer financially.
22. Reference was also made to a leading
decision in Union of India & Ors. v. K.V.
Jankiraman & Ors., (1991) 4 SCC 109 : JT 1991
(3) SC 527. In Jankiraman, the question which
came up for consideration before this Court
related to promotion of an officer and
adoption of \023sealed cover procedure\024. It was
held that consideration of case of an employee
for promotion could not be withheld merely on
the ground of pendency of any departmental
inquiry/criminal investigation against him.
It could, however be resorted to once charge
memo/charge-sheet is issued.
23. It was submitted by the learned
counsel for the Corporation that in the case
on hand, not only notice was issued to the
respondent-employee on January 13, 2000, but
even regular show cause notice was issued on
January 31, 2000 and hence the proceedings
could have been continued on the basis of law
laid down in Jankiraman.
24. In UCO Bank & Ors. v. Sanwar Mal,
(2004) 4 SCC 412 JT 2004 Supp 2 SC 487, the
Court held that two concepts; (i) resignation;
and (ii) retirement were different and
employed for different purposes and in
different contexts. Resignation brings about
complete cessation of master and servant
relationship, but retirement does not do so.
In case of retirement, master and servant
relationship continues for grant of retiral
benefits.
25. If it is so, the appellant-
Corporation, in our opinion, is right in
submitting that the proceedings could have
been continued after the retirement of the
respondent-employee as far as the financial
loss caused to the Corporation because of
negligence on the part of employee and the
benefit claimed by the respondent-workman on
his terminal benefits.
26. Strong reliance was placed by the
learned counsel for the respondent on P.V.
Mahadevan v. MD. T.N. Housing Board, (2005) 6
SCC 636 : JT 2005 (7) SC 417. In that case,
there was inordinate delay of ten years in
initiating departmental proceedings against an
employee. In absence of convincing
explanation by the employer for such
inordinate delay, this Court held that the
proceedings were liable to be quashed.
27. In our opinion, Mahadevan does not
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help the respondent. No rigid, inflexible or
invariable test can be applied as to when the
proceedings should be allowed to be continued
and when they should be ordered to be dropped.
In such cases there is neither lower limit nor
upper limit. If on the facts and in the
circumstances of the case, the Court is
satisfied that there was gross, inordinate and
unexplained delay in initiating departmental
proceedings and continuation of such
proceedings would seriously prejudice the
employee and would result in miscarriage of
justice, it may quash them. We may, however,
hasten to add that it is an exception to the
general rule that once the proceedings are
initiated, they must be taken to the logical
end. It, therefore, cannot be laid down as a
proposition of law or a rule of universal
application that if there is delay in
initiation of proceedings for a particular
period, they must necessarily be quashed.
28. In the present case, the High Court
has not quashed the proceedings on the ground
that there was inordinate and unexplained
delay on the part of the Corporation in
initiating such proceedings against the
respondent. According to the High Court,
since the respondent retired on January 31,
2000, the proceedings could not have been
continued against him. From the case law
referred to by us hereinabove, it is clear
that such proceedings could have been
continued since they were initiated for the
recovery of losses sustained by the
Corporation due to negligence on the part of
the respondent-employee. Such loss caused to
the Corporation could be recovered from the
respondent from the retiral benefits of the
respondent.
29. The learned counsel for the appellant-
Corporation also referred to the Rules.
Chapter IV titles \023Fundamental Duties of
Service\024. Rule 31 expressly states that an
employee of the Corporation would be \021whole
time employee\022. Chapter VIII (Rules 93 to 107)
deals with \021Disciplinary Proceedings\022. Rule
93 is material and relevant part thereof reads
thus;
93. The following penalties may, for
good and sufficient reason and as
hereinafter provides, be imposed on an
employee.
A. MINOR PENALTIES
(i) Censure
(ii) With-holding of annual
increment(s), including stoppage
of an efficiency bar/assessment
stage with or without cumulative
effect.
(iii) Recovery from pay or from such
other amounts as may be due to
the employee of the whole or part
of any pecuniary loss caused to
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the Corporation by negligence or
breach of orders on his part;
B. MAJOR PANALTIES
(iv) reduction to a lower grade or
post or to a lower stage in a
time scale;
(v) removal from service which does
not disqualify from future
employment,
(vi) dismissal from service which
ordinarily disqualifies from
future employment.
(emphasis supplied)
30. Rule 102 prescribes procedure before
starting enquiry. Rule 103 provides for major
penalties. Rule 109 lays down procedure for
imposition of minor penalties and is another
important provision which may be quoted in
extenso.
109. (1) Whenever the punishing
authority is satisfied that good
and sufficient reasons exist for
adopting such a course it may
impose the penalty of
(i) Censure, or
(ii) Stoppage at an efficiency bar.
Provided that it shall not be
necessary to frame formal charges
against the employee concerned but
his explanation may be called and
considered before imposing such a
penalty.
(2) In all cases where the
punishing authority imposes the
penalty of-
(i) Withholding of increments in
the time scale at stages
where there is no efficient
bar.
(ii)Recovery from pay of the whole
or part of any pecuniary loss
caused to the Corporation by
negligence or breach of
orders.
Formal proceedings embodying
statement of the offence or fault,
the explanation of the person
concerned, and the reasons for
punishment shall be recorded.
Provided that it shall not be
necessary to record such
proceedings in cases where an
employee\022s increment in the time
scale of his pay at any stage
other than an efficiency bar is
stopped due to his integrity
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remaining uncertified.
(emphasis supplied)
31. It is, therefore, clear that so far as
minor penalty is concerned, it is not necessary
for the Corporation to follow detailed and
lengthy procedure laid down for imposition of
major penalties. In the instance case, the
proceedings had been initiated by the
appellant-Corporation against the respondent-
employee for recovery of pecuniary loss caused
to the Corporation by negligence on his part.
The proceedings, hence, could be instituted by
issuing notice which was done on January 13,
2000. The said action, therefore, could not
have been held bad or without power, authority
or jurisdiction on the part of the Corporation.
As we have already observed earlier, even
regular show cause notice was served on January
31, 2000 which was also during the employment
of respondent. The High Court, in our view, was
wrong in quashing the proceedings and setting
aside orders dated March 24, 2001 and April 26,
2005. The impugned order of the High Court,
therefore, deserves to be set aside.
32. Finally, the learned counsel for the
appellant-Corporation is right in submitting
that the High Court was exercising
discretionary and equitable jurisdiction under
Article 226 of the Constitution. It is well-
settled that the jurisdiction of the High Court
under Article 226 of the Constitution is
equitable and discretionary. The power under
that Article can be exercised by the High Court
\023to reach injustice wherever it is found\024.
33. In Veerappa Pillai v. Raman & Raman
Ltd. & Ors., 1953 SCR 583, the Constitution
Bench of this Court speaking through
Chandrasekhara Aiyar, J. observed that the
writs referred to in Article 226 of the
Constitution are obviously intended to enable
the High Court to issue them in grave cases
where the subordinate tribunals or bodies or
officers act wholly without jurisdiction, or in
excess of it, or in violation of the principles
of natural justice, or refuse to exercise
jurisdiction vested in them, or there is an
error apparent on the face of the record, and
such act, omission, error, or excess has
resulted in manifest injustice.
34. Again, in leading case of Sangram
Singh v. Election Tribunal, Kotah, (1955) 2 SCR
1, dealing with the ambit and scope of powers
of High Courts under Article 226 of the
Constitution, Bose, J. stated;
\023That, however, is not to say that
the jurisdiction will be exercised
whenever there is an error of law.
The High Courts do not, and should
not, act as courts of appeal under
Article 226. Their powers are purely
discretionary and though no limits can
be placed upon that discretion it must
be exercised along recognized lines
and not arbitrarily; and one of the
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limitations imposed by the courts on
themselves is that they will not
exercise jurisdiction in this class of
case unless substantial injustice has
ensued, or is likely to ensue. They
will not allow themselves to be turned
into courts of appeal or revision to
set right mere errors of law which do
not occasion injustice in a broad and
general sense, for, though no
legislature can impose limitations on
these constitutional powers it is a
sound exercise of discretion to bear
in mind the policy of the legislature
to have disputes about these special
rights decided as speedily as may be.
Therefore, writ petitions should not
be lightly entertained in this class
of case.\024 (emphasis supplied)
35. Recently, in Secretary, ONGC Ltd. &
Anr. v. V.U. Warrier, (2005) 5 SCC 245 : JT
2005 (4) SC 489, an employee of Oil and Natural
Gas Commission (ONGC) unauthorisedly retained
an official accommodation after his retirement.
When penal rent was charged and sought to be
recovered from retiral benefits of the
employee, he filed a petition invoking Article
226 of the Constitution. The High Court allowed
the petition and directed the Corporation to
release all the benefits to which the employee
was entitled. The High Court observed that it
was open to the Corporation to take appropriate
proceedings for recovery of the dues claimed by
the Corporation. Aggrieved ONGC approached
this Court.
36. Allowing the appeal, setting aside the
order passed by the High Court and considering
the relevant decisions on the point, one of us
(C.K. Thakker, J.) observed;
\023As already adverted to by us
hereinabove, the facts of the present
case did not deserve interference by
the High Court in exercise of
equitable jurisdiction under Article
226 of the Constitution. The
respondent-petitioner before the High
Court-, was a responsible officer
holding the post of Additional
Director (Finance & Accounts). He
was, thus, \023gold collar\024 employee of
the Commission. In the capacity of
employee of the Commission, he was
allotted a residential quarter. He
reached the age of superannuation and
retired after office hours of February
28, 1990. He was, therefore, required
to vacate the quarter allotted to him
by the Commission. The Commission, as
per its policy, granted four months\022
time to vacate. He, however, failed
to do so. His prayer for continuing
to occupy the quarter was duly
considered and rejected on relevant
and germane grounds. The residential
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accommodation constructed by him by
taking loan at the concessional rate
from the Commission was leased to
Commission, but the possession of that
quarter was restored to him taking
into account the fact that he had
retired and now he will have to vacate
the quarter allotted to him by the
Commission. In spite of that, he
continued to occupy the quarter
ignoring the warning by the Commission
that if he would not vacate latest by
June 30, 1990, penal rent would be
charged from him. In our judgment,
considering all these facts, the High
Court was wholly unjustified in
exercising extraordinary and equitable
jurisdiction in favour of the
petitioner \026 respondent herein \026 and
on that ground also, the order passed
by the High Court deserves to be set
aside\024. (emphasis supplied)
37. Considering the facts and
circumstances in their entirety, in our
considered opinion, the High Court was wrong in
holding that the proceedings were initiated
after the respondent retired and there was no
power, authority or jurisdiction with the
Corporation to take any action against the
writ-petitioner and in setting aside the orders
passed against him. In our judgment,
proceedings could have been taken for the
recovery of financial loss suffered by the
Corporation due to negligence and carelessness
attributable to the respondent-employee. The
impugned action, therefore, cannot be said to
be illegal or without jurisdiction and the High
Court was not right in quashing the proceedings
as also the orders issued by the Corporation.
The appeal, therefore, deserves to be allowed
by setting aside the order of the High Court.
38. For the foregoing reasons, the appeal
is allowed and the order passed by the High
Court is set aside. But since the High Court
has allowed the petition only on the ground
that the proceedings could not have been
instituted against the writ-petitioner, it
would be appropriate if we remit the matter to
the High Court so as to enable it to consider
the rival contentions of the parties and take
an appropriate decision on merits. We may
clarify that we may not be understood to have
expressed any opinion one way or the other on
the controversy involved in the case and as and
when the High Court will take up the writ
petition, it will decide the same without being
influenced by any observation made in this
judgment. On the facts and in the
circumstances of the case, the parties will
bear their own costs.