REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL No. 10812 OF 2018 [Arising out of SLP (C) No.8774 of 2018]

S. Mahesh                   .. Appellant(s)

Versus

The Chairman Cum Managing Director, Neyveli Lignite  Corporation Ltd. Neyveli  Tamil Nadu & Ors.      .. Respondent(s)

J U D G M E N T

Abhay Manohar Sapre, J.

1. Leave granted.

2. This appeal is filed against the final judgment

and order dated 05.03.2018  passed by the  High

Court of Judicature at Madras in W.A. No. 273 of

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2017 whereby the Division Bench of the High Court

set aside the order dated 07.11.2016 passed by the

learned Single Judge in W.P. No. 15312/2010 and

allowed the writ appeal filed by the respondent

herein.

3. The controversy involved in the appeal is

short. However, few relevant facts herein below need

mention to appreciate the controversy.  

4. The appellant (employee) was the writ

petitioner whereas the respondent herein (employer)

was the respondent in the writ petition filed by the

appellant in the High Court of Madras against the

respondent out of which this appeal arises.

5. The respondent herein is the Government

Company known as Neyveli Lignite Corporation Ltd.

It is mainly engaged in the business of manufacture

and sale of  minerals  (lignite).  It has an office and

business activity in South Arcot (Tamil Nadu).  

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6. The respondent (hereinafter referred to as “the

Corporation”) being a fully owned Government

Company is a  “State” within the meaning of Article

12 of the Constitution of India and is thus amenable

to the writ jurisdiction under Article 226/227 of the

Constitution of India.

7. Pursuant to advertisement issued by the

Corporation for the appointment of “Diploma

Engineer Trainee Grade II (Electrical)”, the appellant

was one of the candidates who applied for the said

post. The appellant was interviewed by the

Corporation and selected for the said post. The

Corporation  on  28.01.1988  accordingly issued  an

appointment letter to the appellant. (Annexure­P­1).

8. In terms of the appointment letter, the

appellant was initially appointed on probation for a

period of two years as Trainee and on its successful

completion, was to be appointed on regular basis as

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Engineering Supervisor (Electrical) on probation for

a period of one year and then to be absorbed as a

regular employee. The appellant was also required

to execute Bond for a particular period.  

9. At the time of the interview and the

appointment, the appellant had produced

photocopy of his Scheduled Caste Certificate to the

Corporation and  had sought time to produce its

original. The Corporation granted the indulgence to

the appellant for producing his original Scheduled

Caste Certificate.

10. The appellant on 03.03.1988, however, sent a

letter (Annexure R­3) to the Corporation informing

them that he belongs a community known as

"Konda Reddi" which is a backward (SC)

community.  He  said that  he  had  approached the

concerned Revenue Authorities  for obtaining caste

certificate in the  prescribed form so  as to  enable

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him to submit it to the Corporation but the Revenue

Authorities informed him that the Department has

stopped issuing any such certificate. The appellant,

therefore, expressed his inability to produce the

original Scheduled Caste Certificate and requested

the Corporation to treat him as a candidate

belonging to the "General Category" instead of

"Reserved Category" in selection process.

11. The  Corporation, on receipt of the aforesaid

letter, issued a posting order no. 1416/P&A/VI­

2/88­3 dated 02.05.1988 to the appellant and

asked him to report for duty. The appellant was also

allotted quarter in general category as a part of his

service condition. The appellant accordingly joined

his duty on 02.05.1988.

12. It was almost after four years of his joining i.e

on 24.05.1993, the Corporation served a memo to

the appellant stating therein that appellant had

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submitted false community certificate at the time of

joining and therefore why disciplinary action be not

taken against him for filing such certificate.  

13. It is not in dispute that the Corporation

though issued this memo to the appellant but did

not  pursue the  matter.  On the other  hand, the

appellant was promoted to the rank of Junior

Engineer Grade I with effect from 01.06.1993 vide

order dated 16.12.1993. The appellant accordingly

started working on the promotional post.  

14. On 11.08.1995, the Corporation issued second

memo to the appellant reiterating the same charge

for which the first memo was issued. The appellant

filed his reply and reiterated his stand which he had

taken in his letter dated 03.03.1988.  

15. The Corporation then conducted a

Departmental Enquiry and recorded the statements

of the  Corporation’s officials  wherein the officials

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admitted that the appellant had sent a letter dated

03.03.1988 expressing therein his inability to

produce the original caste certificate and further

requesting the Corporation to treat him as general

candidate instead of reserved candidate. They also

admitted that the appellant's request was accepted

by DGM/P&A.  

16. Despite this, the Corporation concluded in the

enquiry that the charge leveled against the

appellant has been proved. The appellant was

accordingly awarded a punishment of "reduction of

rank to a lower stage by two stages in his time scale

for a period of 2 years with cumulative effect".   The

Corporation also ordered that henceforth the

appellant be considered as general category

candidate and that he would not be allowed to avail

any benefits  which are extended to the reserved

category candidates. The appellant felt aggrieved

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and filed Departmental Appeal. It was, however,

dismissed.

17. After three years i.e. on 20.09.2000, the

Corporation for the third time issued a memo again

asking the appellant to produce his community

certificate in original for its verification. The

appellant replied to the said memo reiterating his

earlier stand saying that he had already informed

vide his letter dated 03.03.1988 and in the enquiry

proceedings to the Corporation that it was not

possible to produce the original  certificate for the

reasons  mentioned therein. The  appellant further

said that he never took any benefit of reserved

candidate in the service because his request to treat

him as general candidate was accepted by the

Corporation.  

18. The Corporation did not stop here and lodged

an FIR against the appellant on 30.07.2001 in PS

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Neyveli  Town  (Crime No.219) for filing false  caste

certificate. On 04.11.2003, the Police Authorities

submitted a report that there was no case made out

against the appellant in the FIR.   On 15.07.2008,

the Magistrate in RC No.56/2008, on perusal of the

FIR and final report of the Police Authorities, closed

the case against the appellant.

19. After two years, the Corporation again renewed

their efforts and this time, its director invoked the

powers under Rule 30 of the NLC Employees

(Control and Appeal) Rules (hereinafter referred to

as “the Rules”) and by order dated 07.07.2010

substituted the punishment imposed on the

appellant vide order dated 30.8.1997 to that of

declaring appellant's appointment to be  null and

void.

20. The appellant, felt aggrieved, filed writ petition

(W.P. No.1512/2010) in the Madras High Court

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questioning therein the legality and correctness of

the order dated 07.07.2010. The Corporation

contested the writ petition.

21. By order dated 07.11.2016, the learned Single

Judge allowed the appellant's writ petition and

quashed the order dated 07.07.2010.   Feeling

aggrieved of the order passed by the learned Single

Judge, the Corporation filed intra court appeal

before the Division Bench.  

22. By impugned order, the Division Bench

allowed the Corporation’s appeal, and while setting

aside the order passed by the learned Single Judge,

dismissed the appellant's writ petition and upheld

the order dated 07.07.2010 by which the appellant's

appointment was held as null and void. It is against

this order, the writ petitioner (appellant herein) felt

aggrieved and filed the present special leave to

appeal in this Court.

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23. Heard Ms. V. Mohana, learned counsel for the

appellant and Mr. Anil Nag, learned counsel for the

respondent(s).

24. Having heard the learned counsel for the

parties and on perusal of the written submissions

filed by the parties, we are constrained to allow the

appeal and while setting aside of the impugned

order, allow the appellant's writ petition and restore

the order of the Single Judge.

25. In our considered opinion, the entire action of

the  Corporation  starting from  issuance  of second

charge memo dated 11.08.1995 and ending by

passing the order dated 07.07.2010 is arbitrary,

unreasonable, and mala fide exercise of the powers

by the Corporation against the appellant and hence

the same is not sustainable in law.  

26. In any event, the order dated 07.07.2010

which is subject  matter of this appeal and  with

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which  we are really concerned in this appeal is

wholly arbitrary, unreasonable and is not legally

sustainable.  This we say for following reasons.

27. First, the appellant at the first available

opportunity and before joining the duties had sent a

letter on 03.03.1988 of his own to the Corporation

informing therein that it was not possible for him to

produce the  original caste certificate  because the

Revenue Authorities had declined to issue the

original caste certificate to him.

28. Not  only that, the  appellant further  on  his

own requested the Corporation not to treat him as

"reserved candidate" but treat him as "general

candidate".   In this way, the appellant, in our

opinion, did not suppress any information relating

to his caste certificate from the Corporation.

29. Second, the Corporation, in these

circumstances, had three options; first, not to

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appoint the appellant which the Corporation did not

opt;  Second, to grant some more time to produce

the caste certificate or any other material to prove

the appellant’s  caste  which again the Corporation

did not opt and the third, to condone the lapse in

filing the caste certificate and proceed to consider

the appellant's case treating him as a candidate

belonging to the general category for selection

purpose which the Corporation opted.

30. Third, the Corporation by their express

conduct having followed the third option and

condoned the lapse by asking the appellant to join

the duties, which the appellant did, and later

further promoting him to the next higher grade, the

issue relating to caste certificate lost its

significance.  

31. Fourth, in the light of afore­mentioned

reasons, the  Corporation, in  our  opinion,  had  no

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right to hold any Departmental Enquiry in relation

to the issue of appellant's caste certificate because

they condoned the issue of caste certificate by

allowing the appellant to join the duties and later by

promoting him to the next higher grade.  

32. Assuming, however, that the Corporation

could still probe the issue in relation to the

appellant's caste certificate after allowing him to

join, the  Corporation having  held  a  Departmental

Enquiry and imposing the punishment on the

appellant of “reduction of his rank to a lower stage

by two  stages in  his time scale for  a  period  of  2

years with cumulative effect”  by order dated

30.08.1997, the issue of  caste  certificate  attained

finality in all respect.  

33. The  Corporation  had thereafter no power to

raise the issue of caste certificate again in any form

against the appellant. In other words, the issue of

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caste certificate did not survive for any more

consideration between  the  parties inasmuch as it

was not a live issue between the parties.

34. Fifth, assuming that the higher authority had

the power to enhance the punishment imposed on

the appellant  by taking recourse to powers under

Rule 30, such power, in our view, could be exercised

by the authorities within 30 days from the date of

the order of punishment.  

35.   In this case, the punishment order was

passed on 30.08.1997 whereas the higher authority

exercised his power under Rule 30 on 07.07.2010

by which the punishment order dated 30.08.1997

was cancelled and was substituted by an order

declaring the appellant's appointment as null  and

void.  This order was passed beyond a period of 30

days as provided in Rule 30 (3) which in clear terms

provides  that "no order  enhancing  the  punishment

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under this rule shall be made after a period of 30

days  from the date  on which  the original  order  of

punishment was served on the employee charged ".

36. In other words, the higher authority could

pass the order under Rule 30 for revoking the

original order of  punishment dated 30.08.1997 as

being  bad  and  substituting it  with  another  order

declaring the appellant's appointment as null  and

void within 30 days  from the date of  punishment

order i.e, it could be passed on or before 30.09.1997

but not beyond this date.  

37. Since in this case, the order was passed

almost after 13 years from the date of passing of the

original punishment order, and hence on the face, it

was bad in law.

38. In the light of afore­mentioned reasons, we are

of the opinion that in whatever way the question is

examined, the entire action of the Corporation and

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in particular the order dated 07.07.2010 which is

subject matter of this appeal is found to be wholly

arbitrary, unreasonable and, therefore, it is held

legally unsustainable.  

39. The Single Judge,  therefore,  rightly set aside

the order impugned in the writ petition whereas the

Division Bench was not  right in setting aside  the

order of the Single Judge.

40. We cannot, therefore, agree with the reasoning

and the conclusion of the Division Bench but are

inclined to concur with the reasoning and the

conclusion arrived at by the learned Single Judge in

addition to our own reasoning given above.

41. In view of the foregoing discussion, the appeal

succeeds and is hereby allowed. The impugned

order passed by the Division Bench is set aside and

the order passed by the Single Judge (Writ Court) is

restored.  

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42. As a consequence, order dated 07.07.2010

passed by the Director  (Power)  of the Corporation

which set aside the order of punishment dated

30.08.1997 and in its place substituted the order by

declaring the appellant's appointment void ab initio

is hereby quashed.   

………………………………..J  (ABHAY MANOHAR SAPRE)

           …..………………………………J.      (INDU MALHOTRA)

New Delhi, October 29, 2018

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