U.P.POWER CORP.LTD. Vs VIRENDRA LAL
Bench: ANIL R. DAVE,DIPAK MISRA
Case number: C.A. No.-008949-008949 / 2013
Diary number: 17345 / 2011
Advocates: V. N. RAGHUPATHY Vs
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Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.8949 OF 2013 (Arising out of S.L.P. (C) No. 20605 of 2011)
U.P. Power Corporation Ltd. and another ... Appellants
Versus
Virendra Lal (Dead) through L.Rs. ...Respondents
J U D G M E N T
Dipak Misra, J.
Leave granted.
2. Calling in question the legal acceptability of the order
dated 11.2.2011 passed by the High Court of Judicature at
Allahabad, Lucknow Bench, Lucknow, in Writ Petition (S/B)
No. 211 of 2011 whereby the Division Bench has affirmed
the judgment dated 23.9.2010 passed by the State Public
Service Tribunal, Lucknow, (for short “the tribunal”) in
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claim petition No. 683 of 2000 wherein the tribunal had
set aside the order dated 12.10.1999 passed by the U.P.
State Electricity Board (UPSEB) imposing punishment of
deduction of 10% amount of pension payable to the
original respondent, Virendra Lal, predecessor-in-interest
of the respondents herein, the U.P. Power Corporation Ltd.
(for short “the Corporation) and its functionaries have
preferred this appeal by special leave.
3. The expose’ of facts are that late Virendra Lal was
posted as Assistant Engineer in Electricity Distribution
Division, Sultanpur in the year 1984 and at that time he
had released electricity to one consumer, namely, M/s.
Arif Cement Industries, Jagdishpur, beyond the
approved estimate as a consequence of which wrongful
loss was caused to UPSEB. After the authorities of the
UPSEB came to know about the same, the matter was
forwarded to the inquiry committee on 27.9.1994 for
initiation of a disciplinary proceeding on the basis of
which on 23.2.1998, the inquiry committee framed
charges against him and called for an explanation. The
delinquent employee filed his reply on 16.4.1998 and
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thereafter the inquiry committee commenced the
enquiry. On 30.6.1998, late Virendra Lal stood
superannuated. On 28.1.1999 the inquiry report was
served on him and he was granted opportunity to
submit a representation pertaining to the inquiry report.
On 21.3.1999 he filed his representation and
considering the submissions put forth in the
representation on 12.10.1999 the UPSEB passed the
order of punishment as has been stated hereinbefore.
The said order was communicated to late Virendra Lal
by the Joint Secretary of the UPSEB.
4. Grieved by the aforesaid order, Virendra Lal preferred
claim petition No. 683 of 2000 before the tribunal
contending, inter alia, that there is no statutory
provision in the UPSEB for recovery from the pension of
a retired officer; that the power to deal with the report
of the inquiry committee vests in the Chairman of the
UPSEB in regulation 6(4) of U.P. State Electricity Board
(Officers and Servants) (Conditions of Service)
Regulations, 1975 (for short “the Regulations”) but as
the punishment had been imposed by the UPSEB he
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had been deprived of the right of appeal; that other
officers with similar allegations had been exonerated
but he alone was proceeded which was discriminatory
in nature; and that the manner in which the proceeding
was conducted was violative of the principles of natural
justice and had caused serious prejudice to him. The
stand and stance put forth by him was opposed by the
UPSEB.
5. The tribunal adverting to the application of certain
Rules, violation of principles of natural justice, the delay
in commencement of the departmental proceeding and
the prejudice caused to the delinquent employee set
aside the order dated 12.10.1999 and directed to
release the deducted amount of pension to the
applicant therein with simple interest @ 8 per cent per
annum from the date the amount was due to the date
of the actual payment and further directed for release
of the pension forthwith.
6. Being dissatisfied with the aforesaid order the
Corporation preferred a writ petition before the High
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Court and the Division Bench disposed of the same by
passing the following order
“During the course of argument, it has been admitted by the petitioners’ counsel that under Rules, Chairman is the disciplinary authority who is competent to pass the order. Justification has been given by the petitioners’ counsel that since the claimant respondent is a retired person, power was exercised by the Board. Even if an employee is retired, the power should be exercised by the same authority who has been conferred power to work as disciplinary authority under rules. Power cannot be usurped by the higher authority in violation of the service rules. Accordingly, the impugned order passed by the tribunal does not seem to suffer from any impropriety or illegality.”
7. We have heard Mr. Shiv Kumar Tripathi, learned counsel
for the appellants. Despite service of notice on the
legal heirs of the original respondent, there has been no
appearance.
8. Criticizing the order passed by the High Court it is
submitted by Mr. Tripathi that the High Court has fallen
into error by opining that even in respect of a retired
employee the power should be exercised by the same
authority who had been conferred power to act as the
disciplinary authority under the Regulations. It is urged
by him that if the higher authority initiates the
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disciplinary proceeding and imposes the punishment
and no prejudice is caused the order of punishment
cannot be annulled on that score. It is further
canvassed by him that as the High Court has only
addressed to a singular issue and arrived at the
conclusion, the matter deserves to be remitted to the
High Court for adjudication on other issues.
9. It is not in dispute that the disciplinary proceeding was
initiated against the original respondent while he was in
service and thereafter the proceeding continued and,
eventually, the Board passed the order of punishment.
Learned counsel for the appellants has drawn our
attention to the Regulations. Regulation 6 deals with
constitution of Committee to enquire into cases. Sub-
regulation (4) of the said Regulation reads as follows: -
“(4) The Chairman shall in relation to Officers and servants upto the rank of Superintending Engineer deal with the report and recommendations of the Inquiry Committee in accordance with the relevant regulations and pass final orders. In the case of Officers above the rank of Superintending Engineer, the Chairman shall place the report of the Inquiry Committee along with its recommendations, if any, before the Board, who shall pass final orders.”
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10. On a perusal of the aforequoted sub-regulation it is
quite vivid that the Chairman has been empowered to
deal with the report and recommendations of the
Inquiry Committee in accordance with the relevant
Regulations and pass final orders in respect of officers
upto the rank of Superintending Engineer. The
delinquent employee, Late Virendra Lal, retired from
service as an Assistant Engineer which rank is lower
than the Superintending Engineer. Hence, the
Chairman was authorized to pass the order of
punishment. As the factual matrix would reveal the
order of punishment was passed on 12.10.1999 and the
Board had passed that order. The said order reads as
follows: -
“The Board has asked to Shri Lal to file his representation within 14 days providing him a copy of enquiry report received from enquiry committee vide letter No. 490-Shija-05d/SEB- 99-7(38)-05D/96. Shri Lal has submitted his representation on 21.3.1999 and it has been found after examination thereof that Shri Virendra Lal could not clarify in his representation as to why he has installed a sub- station deviating from approved estimate. The recommendation by Enquiry Committee that Shri Lal is guilty of providing wrongful gain to consumer and wrongful loss to Board is proper and appropriate.
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Therefore Shri Virendra Lal (77031) then Assistant Engineer (presently retired) has been found the guilty of misconduct and charges levelled against him, so the order hereby is passed to deduct 10% amount of the pension payable to him for 5 years with due compliance of the CCA Rules.
By the order of the Board Sd/-
S.P. Singh Joint Secretary 11.10.1999”
11. At this stage, it is appropriate to refer to sub-
regulation (5) of Regulation 6 which reads as follows: -
“(5) An appeal or representation, as the case may be, from the orders of the Chairman passed under sub-regulation (4) shall lie to the Board.”
12. Thus, if an order is passed by the Chairman, an
appeal or representation, as the case may be, lies to
the Board. In any case it is subject to challenge in the
hierarchical system of the UPSEB. Learned counsel has
commended us to the decision in State of Uttar
Pradesh v. Brahm Datt Sharma and another1. The
said decision only supports the proposition that if a
disciplinary proceeding against an employee of the
Government is initiated in respect of a misconduct
1 (1987) 2 SCC 179
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committed by him and if he retires from service on
attaining the age of superannuation before completion
of the disciplinary proceedings and charges are of
serious nature, then it is open to the Government to
take proceedings against the Government servant in
accordance with the rules for the reduction of pension
and gratuity.
13. In Takhatray Shivadattray Mankad v. State of
Gujarat2, the appellant therein was compulsorily
retired on January 12, 1962 in one of the departmental
proceedings. Two other proceedings were instituted in
the year 1963 and that is earlier to his attaining the age
of superannuation on January 14, 1964. These
departmental proceedings were dropped on the ground
that they had been rendered infructuous. Thereafter,
the proceedings were revived and, eventually, certain
punishment was imposed pertaining to determination of
his pension. The learned Judges dealing with the said
submission opined thus: -
“The learned counsel for the appellant strenuously contended that after the
2 1989 Supp (2) SCC 110
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disciplinary inquiries had been dropped on the ground that they had become infructuous, the government was not right and justified in reducing the pension and gratuity on the same charges which were the subject matter of the enquiries. This argument of the learned counsel, in our opinion, does not merit consideration because the charges against the appellant were not made use of for awarding any punishment after his retirement from service but only for determining the quantum of the appellant’s pension in accordance with the rules relating to the payment of pension and gratuity.”
To arrive at the said conclusion the Court relied upon
the principles stated in Brahm Datt Sharma (supra).
14. In the case at hand, we may note with profit that
though the tribunal has recorded that there is no
provision for continuance of such a proceeding, yet the
said issue need not be addressed to as we are only
concerned with the controversy, as has emerged in this
appeal, whether the UPSEB could have imposed the
punishment accepting the recommendations of the
Inquiry Committee.
15. In this context, we may fruitfully refer to the
authority in Surjit Ghosh v. Chairman & Managing
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Director, United Commercial Bank and others3. In
the said case, the disciplinary proceeding was initiated
against the delinquent employee by the Deputy General
Manager of United Commercial Bank, the respondent
therein. The disciplinary authority at the relevant time
was the Divisional Manager/Assistant General Manager
(Personnel) and an appeal against their order lay to the
Deputy General Manager or any other officer of the
same rank. Against the order of the Deputy General
Manager a review lay to the General Manager. In this
backdrop a contention was raised that the appellant
was deprived of an opportunity to prefer an appeal
provided under the Regulations and the same goes to
the root of the dismissal order. The said contention was
combatted by the employer contending, inter alia, that
when the Deputy General Manager is higher in rank
than the disciplinary authority and the order of
punishment has been passed by the higher authority,
no prejudice has been caused to the employee. A
further contention was raised that in the facts and
circumstances of the case it should be held that when 3 (1995) 2 SCC 474
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the order of punishment is passed by higher authority,
no appeal is available under the Regulations as it is not
necessary to provide for the same. Repelling the said
argument the Court opined that it is true that when an
authority higher than the disciplinary authority itself
imposes the punishment, the order of punishment
suffers from no illegality when no appeal is provided to
such authority. However, when an appeal is provided to
the higher authority concerned against the order of the
disciplinary authority or of a lower authority and the
higher authority passes an order of punishment, the
employee concerned is deprived of the remedy of
appeal which is a substantive right given to him by the
Rules/Regulations. Thereafter, the learned Judges
proceeded to state thus:
“The higher or appellate authority may choose to exercise the power of the disciplinary authority in some cases while not doing so in other cases. In such cases, the right of the employee depends upon the choice of the higher/appellate authority which patently results in discrimination between an employee and employee. Surely, such a situation cannot savour of legality. Hence we are of the view that the contention advanced on behalf of the respondent-Bank that when an appellate authority chooses to exercise the power of
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disciplinary authority, it should be held that there is no right of appeal provided under the Regulations cannot be accepted.”
16. In Balbir Chand v. Food Corporation of India
Ltd. and others4 the Court adverted to the relevant
rule position and came to hold that in normal
circumstances the Managing Director being the
appellate authority should not have passed the order of
punishment so as to enable the delinquent employee to
avail right of appeal. The Court observed that it is a
well-settled legal position that an authority lower than
the appointing authority cannot take any decision in the
matter of disciplinary action, but there is no prohibition
in law that the higher authority should not take decision
or impose the penalty as the primary authority in the
matter of disciplinary action. On that basis, it cannot be
said that there will be discrimination violating Article 14
of the Constitution or causing material prejudice. It is
relevant to state here that the decision in Surjit Ghosh
(supra) was pressed into service but the same was
distinguished stating that in the said judgment under
4 (1997) 3 SCC 371
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the Rules officer lower in hierarchy was the disciplinary
authority but the appellate authority had passed the
order removing the officer from service and thereby,
the remedy of appeal provided under the Rules was
denied. In those circumstances, this Court opined that
it caused prejudice to the delinquent as he would have
otherwise availed of the appellate remedy and his right
pertaining to his case being considered by an appellate
authority on question of fact was not available. But it
cannot be laid as a rule of law that in all circumstances
the higher authority should consider and decide the
case imposing penalty as a primary authority under the
Rules. Be it noted, in the said case a right of second
appeal/revision was provided to the Board and, in fact,
an appeal was preferred to the Board. Regard being
had to the said fact situation, this was Court declined to
interfere.
17. Thus, from the aforesaid it is quite clear that in
Balbir Chand (supra) though the Court approved the
principles laid down in Surjit Ghosh (supra), yet
distinguished the same keeping in view the rule
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position. Be it noted, the Court made a distinction
between the non-availability of the appellate remedy in
entirety and availability of a remedy or a revision with
the higher authority and preservation and non-
extinction of the said right.
18. In Electronics Corporation of India v. G.
Muralidhar5 the order of termination was not passed
by the disciplinary authority but by the appellate
authority and on that score the High Court had quashed
the order of termination and directed reinstatement
with back wages. After adverting to the facts of the
case the learned Judges declined to accept the
submission of the appellant therein that the judgment
rendered in Surjit Ghosh case (supra) should be
limited to the facts of that case. The Court further took
note of the fact that there was no general provision
which conferred a power of review or revision on the
Board against an order passed by the Chairman-cum-
Managing Director who had passed the order of
dismissal and, therefore, even if the Board may be a
5 (2001) 10 SCC 43
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higher authority to the Chairman-cum-Managing
Director to hold that an appeal would lie against an
order of termination passed by the CMD would
tantamount to a fresh legislation since there is no
general provision which confers a power of review or
revision on the Board against any order passed by the
CMD. Being of this view, the Court on the foundation of
the ratio laid down in Surjit Ghosh (supra) ruled that
the order of punishment was vitiated.
19. In this regard reference to the principles laid down in
A. Sudhakar v. Postmaster General, Hyderabad
and another6 is fruitful. We may aptly quote a
passage from the same: -
“18. It is now trite that an authority higher than the appointing authority would also be the designated authority for the purpose of Article 311 of the Constitution. Even the Appellate Authority can impose a punishment subject, of course, to the condition that by reason thereof the delinquent officer should not be deprived of a right of appeal in view of the fact that the right of appeal is a statutory right. However, if such right of appeal is not embellished, an authority higher than the appointing authority may also act as a disciplinary authority.”
6 (2006) 4 SCC 348
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20. In S. Loganathan v. Union of India and others7,
a two-Judge Bench placed reliance on the decisions
rendered in Surjit Ghosh (supra) and Electronics
Corporation of India (supra) and, eventually, opined
that as the appellant’s right to appeal had not been
affected by the authority passing the order, the
punishment imposed could not be said to be vitiated in
law.
21. From the aforesaid enunciation of law it is graphically
clear that a higher authority may pass an order
imposing a punishment and the same would withstand
scrutiny if the right of appeal is not taken away. That
apart, if the appellate authority passes an order as the
primary authority and there is provision for further
appeal or revision or review it cannot be said that the
said order suffers from any illegality. In the case at
hand, there is no denial of the fact that the UPSEB has
passed the order for deduction of 10% pension from the
delinquent employee. Under the Regulations which we
have reproduced hereinbefore there is a stipulation that
7 (2012) 1 SCC 293
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an appeal or representation, as the case may be, from
the order of the Chairman shall lie to the UPSEB. The
Regulation clearly provides that in case of an Assistant
Engineer the Chairman is the competent authority to
pass the order of punishment and, therefore, by virtue
of the order passed by the UPSEB remedy of appeal was
denied to the delinquent employee. Under these
circumstances, the view expressed by the High Court
has to be regarded as flawless and, accordingly, we
concur with the same.
22. Consequently, the appeal, being devoid of merit,
stands dismissed without any order as to costs.
……………………….J. [Anil R. Dave]
……………………….J. [Dipak Misra]
New Delhi; October 03, 2013.