THE HON'BLE SMT. JUSTICE P.MADHAVI DEVI
WRIT PETITION No. 25920 of 2022
ORDER:
This writ petition has been filed by the petitioner seeking a writ of mandamus declaring the action of the respondents in withholding and not paying full amount of terminal benefits of Gratuity and leave encashment to the petitioner, as illegal, void and consequently to direct the respondents (1) to pay the amount of Rs.8,03,000/- which was withheld by the respondents from the total amount of Gratuity payable to the petitioner as per the Gratuity Act, with interest @ 10% from the date of such illegal withholding; and (2) to pay the amount of leave encashment, permitting the petitioner to encash the unavailed privilege leave of 240 days credited on compulsory retirement and to pass such orders or orders as the Hon'ble Court deems fit and proper.
2. Brief facts leading to the filing of the present writ petition are that the petitioner joined as a clerk in Andhra Bank on 24.05.1985 and worked in various capacities at several branches/offices over a period of 28 years. While the petitioner was working as Senior Branch Manager, N.S.Road branch, Hyderabad, the petitioner was issued a charge memo dated 01.06.2013 regarding certain irregularities in the transactions in two education loans at N.S.Road Branch i.e., (a) Education Loan Account of Mr.Kendyala S.Nagarjuna; Rs.10.20 lakhs;
(b) Education Loan Account Ms.Indrakanti Naga Pratyusha; Rs.15 2 W.P.No.25920 of 2022 lakhs. It was alleged that both the loans were sanctioned by the Zonal Manager and there were certain procedural irregularities in disbursement of loan amount by the petitioner. Thereafter, the petitioner was issued another charge memo dated 11.11.2013 in respect of certain transaction in two loans at Manuguru Branch i.e., (a) Clean Loan Account of Dr./Mrs.Ch.V.Ramalaxmi; Rs.2.50 lakhs; (b) Clean Loan Account of Mr.Sabbani Shanker; Rs.2.50 lakhs. The petitioner was also charged for borrowing money in violation of conduct rules. It is submitted that in respect of charge memo dated 01.06.2013, after conducting Domestic Enquiry, the disciplinary authority has imposed a penalty of "Compulsory Retirement" vide order of punishment dated 15.03.2014.
3. It is submitted that in respect of the second charge sheet dated 11.11.2013, the competent authority discontinued the domestic enquiry in view of the punishment of compulsory retirement awarded to the petitioner and directed the Branch Manager, Manuguru to file a complaint with the Police. Accordingly the Branch Mananger, Andhra bank, Manuguru branch, has filed a complaint with Station House Officer, P.S.Manuguru on 30.05.2014 and Crime No.145, dated 30.05.2014 was registered under Sections 420 and 409 of IPC.
4. It is submitted that at the time of compulsory retirement, the petitioner was having huge amount of loans borrowed from the bank and since his retirement benefits and gratuity were paid to the 3 W.P.No.25920 of 2022 petitioner, he had borrowed from bank and friends to repay the loans and close the loan amounts and thereafter, the petitioner requested the respondent bank for early sanction of the terminal benefits vide representation dated 04.02.2016. Subsequently, vide letter dated 17.06.2016, the respondent bank has sanctioned gratuity of Rs.10 lakhs to the petitioner and directed that the amount of all outstanding loans and dues including furniture, credit card, co-operative bank, etc., are to be adjusted from the gratuity. It was also directed to pay the amount of gratuity after ensuring recovery of all the loans and other dues payable by the petitioner to the bank. It is submitted that a sum of Rs.8.03 lakhs was deducted from the gratuity and only a net amount of Rs.1.97 lakhs was credited to the petitioner's account. Challenging the said action of recovery from the gratuity and not paying the entire leave encashment to the petitioner on his compulsory retirement, this writ petition has been filed.
5. Learned counsel for the petitioner submitted that no notice was given to the petitioner prior to recovery of sum of Rs.8.03 lakhs, nor were the details of recovery furnished. It is submitted that aggrieved by the action of the bank, the petitioner had submitted a letter to the respondent bank dated 26.07.2013 and the petitioner had also requested the bank vide his letter dated 26.07.2016 to furnish him the details/reasons for deducting such huge amount from the gratuity payable to him and that vide letter dated 30.08.2016 the petitioner was 4 W.P.No.25920 of 2022 informed about the break-up of sum of Rs.8 lakhs which has been withheld by the bank.
6. Learned counsel for the petitioner submitted that though the loan accounts mentioned in the letter were already closed, none of these accounts were mentioned in the charge sheet and no show cause notice was given to him and no order was passed by the disciplinary authority or any other competent authority determining the liability of the petitioner to the bank and that the same should be recovered from the gratuity and therefore, the recovery is bad in law and was in violation of principles of natural justice. The petitioner, therefore, had filed a representation dated 12.09.2016 with the respondents, however, no reply was received from the bank is the grievance of the petitioner.
7. It is submitted that in respect of payment towards encashment of privilege leave, the respondent bank has replied that the officers whose services were terminated as a measure of penalty are not eligible for leave encashment in terms of prevailing guidelines as on the date of their exit. Though, the petitioner has submitted various representations on this issue also, the same remained un-responded.
8. Learned counsel for the petitioner submitted that subsequently a criminal case was registered against the petitioner in C.C.No.178 of 2015 and as a result of an Hon'ble acquittal of the petitioner, the 5 W.P.No.25920 of 2022 petitioner cannot be held responsible for payment of Rs.8,03,000/-. Challenging the action of the respondents in withholding a sum of Rs.8 lakhs towards repayment of loans which have already closed and also in not allowing encashment of privilege leave, the present writ petition is filed.
9. Learned counsel for the petitioner reiterated the submissions made as above. There was no appearance for the bank in spite of the name of the counsel being printed in the list. Since there is no appearance on behalf of the respondents, the matter was heard ex- parte the respondents in the writ petition.
10. Learned counsel for the petitioner places reliance upon the judgment of this Court in W.P.No.8033 of 2019 in similar set of facts wherein after hearing the learned Standing counsel for the bank (who happens to be the standing counsel in this case also), this Court had held that recovery of the amount from the gratuity without issuing any notice is in violation of principles of natural justice and it was accordingly set aside and the respondents were directed to reconsider the case of the petitioner therein for payment of gratuity in accordance with the provisions under the payment of Gratuity Act.
11. Learned counsel for the petitioner also places reliance upon the judgment of this Court in Writ Appeal No.502 of 2016, dated 12.08.2016, wherein the petitioner therein was initially dismissed from 6 W.P.No.25920 of 2022 service on his conviction in the criminal case and subsequently on his acquittal, his punishment was converted to compulsory retirement and when his request for leave encashment, was denied on the ground that an officer who is compulsory retired as a measure of punishment, will not be entitled to leave encashment. After considering the issue at length, the Hon'ble Division Bench of Andhra Pradesh High Court has held that the regulations do not deny a compulsorily retired employee of his right to encash the privileged leave.
12. Learned counsel for the petitioner submits that the respondents may be directed to reconsider the case of the petitioner in terms of the above two judgments.
13. In view of above submissions and also the cases relied upon by the learned counsel for the petitioner, this Court finds that in the present case also no notice was given to the petitioner before imposing the punishment of recovery of sum of Rs.8.03 lakhs from the gratuity and also in denying the leave encashment to the petitioner without calling for any explanation. Therefore, this Court is of the opinion that the same is in violation of principles of natural justice and needs reconsideration in accordance with the above judgments. Therefore, the impugned order dated 15.03.2014 is set aside and the respondents are directed to reconsider the case of the petitioner in the light of the above two judgments and also the fact that the petitioner has already paid the loan and there is no outstanding dues from the petitioner and 7 W.P.No.25920 of 2022 to pass suitable and appropriate orders thereon within a period of four weeks from the date of receipt of a copy of this order. It is needless to mention that the petitioner shall be given a fair opportunity of hearing. It is further directed that the gratuity and leave encashment, if are found to be payable to the petitioner, they shall be paid to the petitioner within a period of three months thereafter with interest @ 6% per annum from the date of the petitioner's entitlement till the date of payment.
14. The writ petition is accordingly disposed of. There shall be no order as to costs.
Miscellaneous applications, if any pending, shall also stand closed.
_____________________________ JUSTICE P.MADHAVI DEVI Date: 29.10.2022 bak 8 W.P.No.25920 of 2022 THE HONOURABLE SMT. JUSTICE P. MADHAVI DEVI WRIT PETITION No. 25920 of 2022 Date: 29.10.2022 bak