A removed railway servant is not entitled to encash earned leave under Rule 504.

The applicant, a former Railway employee, was initially appointed as a Trade Man on 8 April 1970 and was subsequently promoted to the post of Charge Man A. He was convicted by the Special Judge, CBI, Patna on 29 November 2004 in connection with a bribery case and was thereafter removed from service on 19 August 2005.

The order of removal and the appellate order affirming it were not set aside by any higher forum.

The applicant claimed encashment of Leave on Average Pay (LAP)/earned leave standing to his credit. After the respondents rejected his representation by a reasoned order dated 13 October 2022, following directions issued in an earlier OA, he filed the present application seeking leave encashment with interest.

The respondents contended that, under the Indian Railway Establishment Code (IREC), a Railway servant removed from service was not entitled to encashment of leave.

Whether a Railway servant removed from service is entitled to encashment of LAP/earned leave standing to his credit under the IREC

Whether denial of leave encashment violated the applicant’s constitutional right to property under Article 300A of the Constitution

Whether the principles in State of Jharkhand v. Jitendra Kumar Srivastava and Dattaram Atmaram Sawant v. Vidharbha Konkan Gramin Bank entitled the applicant to the claimed benefit

The Tribunal primarily applied Rule 504 of the Indian Railway Establishment Code, Volume I, which provides that, except as otherwise provided, a Railway servant’s claim to leave standing to his credit ceases upon dismissal, removal or resignation; reinstatement on appeal or revision restores the entitlement to count prior service for leave.

The Tribunal also considered Rules 549 and 550 of the IREC, but found no provision therein granting leave encashment to a Railway servant removed from service.

Under Article 300A of the Constitution, a person cannot be deprived of property except by authority of law.

Relying on State of Jharkhand v. Jitendra Kumar Srivastava, the Tribunal recognised that pension, gratuity and leave encashment may constitute property, but held that the principle applies where deprivation lacks statutory authority.

Dattaram Atmaram Sawant v. Vidharbha Konkan Gramin Bank was distinguished because it concerned employees who had resigned under different service regulations, which did not specifically extinguish their accrued right to leave encashment.

The Tribunal first held that the applicant continued to be legally regarded as removed from service because the removal order and the appellate decision had neither been challenged before nor set aside by a competent forum.

It then applied Rule 504 of the IREC and concluded that the applicant’s claim to leave standing to his credit ceased upon his removal.

Since Rules 549 and 550 did not provide an entitlement to leave encashment for a removed Railway servant, the respondents’ rejection of the claim was held to be consistent with the applicable statutory rules.

The Tribunal further held that the Article 300A principle in Jitendra Kumar Srivastava did not assist the applicant because the denial was based on the statutory framework of the IREC, rather than merely on an executive instruction.

The Bombay High Court decision in Dattaram Atmaram Sawant was found inapplicable on account of materially different facts and service regulations.

The respondents’ reasoned order dated 13 October 2022 rejecting the claim was upheld, and the Original Application was dismissed as devoid of merit.

The connected miscellaneous applications were disposed of and no order as to costs was made.