Anil Ji vs U.P. Cooperative Dairy ...
2017 Latest Caselaw 8200 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
 
 


 
A.F.R.
 
Reserved
 
Case :- SERVICE BENCH No. - 16 of 2014
 

 
Petitioner :- Anil Ji
 
Respondent :- U.P. Cooperative Dairy Federation & Milk Union Centralized S
 
Counsel for Petitioner :- Sudeep Kumar,Avdhesh Kumar Pandey
 
Counsel for Respondent :- Shanker Lal,Anuj Kudesia
 

 
Hon'ble Dr. Devendra Kumar Arora,J.

Hon'ble Rajnish Kumar,J.

(Delivered by Hon'ble Rajnish Kumar, J.)

1. Heard Sri Sudeep Kumar, learned Counsel for the petitioner and Sri Anuj Kudesia, learned Counsel for the opposite parties.

2. The petitioner has approached to this Court for direction to respondents to pay the remaining terminal dues more fully described in paragraph 27 of the writ petition notwithstanding any disciplinary proceedings if any, pending against the petitioner.

3. The writ petition has been filed by the petitioner stating therein that the petitioner was the member of the U.P. Cooperative Dairy Federation and Milk Union Centralized Services, 1984 and the service conditions of the petitioner were being governed by the provisions of the U.P. Cooperative Societies Employees Service Regulations, 1975 and there is no provision in the Service Regulations which permit the respondents to retain the post retiral dues on any ground and as such the respondents are acting wholly in a malafide manner in withholding the terminal dues of the petitioner. Even otherwise there is no enabling provision in Service Regulations, 1975 in the like manner of Article 351-A of the Civil Service Regulations which permit the respondents to continue with any disciplinary proceedings initiated prior to superannuation or to initiate fresh disciplinary proceedings after superannuation and as such no disciplinary proceedings can be commenced or continued after superannuation and this view has been settled by this Hon'ble Court in several Cases.

4. The petitioner was initially appointed as Assistant Manager (Production) vide order dated 26.11.1981 passed by Additional Managing Director of the PCDF, in the pay scale of Rs. 550/1200/220. In pursuance thereof the petitioner submitted his joining at Feeder Balancing Dairy, Varanasi. After coming into force of the Centralized Services Rules, the Services of the petitioner were absorbed on the post of Manager, Grade III in class II in the pay scale of Rs. 1250-2050 in view of the Rule 17 (3) and Rule 20 (3) of the Centralized Service Rules by the order dated 15.9.1984 passed by the Chairman, Administrative Committee.

5. The petitioner has served in various milk unions and lastly the petitioner was posted at Parag Dairy, Noida from where the petitioner retired on attaining the age of superannuation.

6. It has further been stated that on account of irregularities committed by the Milk Union, Meerut in conversion of milk from private converter, loss was caused to the PCDF in respect of Ghee and Powder and in order to shift the responsibility on those officers who were posted at milk supplying units, disciplinary proceedings were initiated. In the like manner disciplinary proceedings were initiated against the petitioner vide order dated 08.10.2002 during the period when the petitioner was posted at Milk Union, Agra.

7. The charge-sheet was served to the petitioner vide letter dated 07.11.2002 by the inquiry officer and after receiving the charge sheet he has submitted his reply to charge sheet on 21.06.2004. Thereafter, the petitioner did not hear anything about the disciplinary inquiry as the petitioner was neither provided any copy of the inquiry report nor any show show cause notice was issued.

8. It has further been submitted that for the incident of conversion a First Information report was also lodged and the investigation was entrusted to Economic Offence Wing and a report was submitted and in the said report only the officers/employees who were posted at Milk Union, Meerut were found responsible and no responsibility whatsoever was fixed on the petitioner. Even then no decision has been taken by the respondents in the disciplinary proceedings which were initiated in the year 2002.

9. It has further been submitted that after attaining the age of superannuation and in pursuance of a notice dated 4.7.2012, the petitioner has retired with effect from 31.7.2012. According to the last pay certificate issued by the Incharge, Parag Dairy, Noida dated 05.10.2012 it would reveal that at the time of superannuation the petitioner was working in the pay scale of Rs. 10,000-15,200 and was drawing Rs. 53,438/- prior to deduction. Further, as per the last pay certificate the petitioner is entitled for earned leave encashment of 300 days. The petitioner has also obtained no dues certificate from different places and has submitted to the respondents for payment of terminal dues.

10. It has further been submitted that after superannuation of the petitioner the petitioner has also furnished an indemnity bond in respect of payment of 90% of the amount of gratuity to the petitioner. The petitioner has submitted that the respondents are insisting the superannuated employees for execution of the indemnity bond which is patently without jurisdiction inasmuch as in view of the provisions of Payment of Gratuity Act the amount of gratuity can be forfeited only under the contingencies provided under section 4(6) of the Payment of Gratuity Act and no amount of gratuity can be stopped or retained by the respondents in disguise of pending audit objection, but since the livelihood of the petitioner is dependent upon terminal dues which are payable after superannuation of an employee, the petitioner has executed the indemnity bond on a non-judicial stamp paper of Rs. 100/-.

11. The petitioner has disclosed in paragraph 27 of the writ petition the dues for which the petitioner is entitled which is reproduced as under :-

a)

Arrears of differential amount in pursuance to the recommendation of Vth pay Commission for the period from January 1996 till July 1998

Rs.55,772/-

Employee's provident fund for the aforesaid period

Rs.6,692.62

Interest accrued on the aforesaid amount for a period of 14 years @ 10%

Rs.2,37,206.93

b)

Arrears of promotion scale

Rs.50,000/-

c)

GSLI and interest accrued

Rs.30,000/-

d)

Gratuity

Rs.10,00,000/-

e)

EL encashment of 300 days

Rs.7,24,490/-

Total

Rs.21,04,161.50

12. The petitioner has further stated that the aforesaid payments outstanding upon the respondents are being denied by the respondents without any rhyme or reasons. The respondents are deliberately denying the payment of terminal dues of the employees and members of the Centralized Services by illegally taking shelter to the provisions of Rule 22 of the Centralized Service Rules in respect of those employees/members of centralized services who are superannuated from the Milk Unions. Though the respondents are having sufficient funds for the payment of dues inasmush as when this Court has shown strong concern, then the dues of those persons who have been paid who were the petitioners irrespective of the fact that the direction of this Court was general in nature and the petitioner cannot be discriminated.

13. It has further been submitted that the petitioner is running from pillar to post for his legitimate dues but the same have not been paid by the respondents though they are well aware that in absence of timely payment of terminal dues to the petitioner it is not possible for the petitioner to carry out his livelihood.

14. It is further submitted that the petitioner has given representations to the respondents on 6.10.2012, 5.12.2012, 23.5.2013 and lastly on 11.8.2013 by informing the respondents about the outstanding payments but till date no action has been taken by the respondents, and respondents are sitting over the matter and they have not taken any decision on it.

15. He further submitted that having been left with no other alternative and efficacious remedy available, the petitioner is approaching to this Court for payment of his entire post retiral dues.

16. The opposite parties have filed counter affidavit admitting for payment of the entire post retrial dues to the petitioner as described in Para 27 of the writ petition .

17. It has further submitted that the payment of arrears of differential amount in pursuance to the recommendation of Vth Pay Commission for the period of January, 1996 till July 1998 has to be done by Dairy Federation, Kanpur but as the financial condition of the Dairy Federation, Kanpur is not sound therefore the same is pending for payment.

18. It has further been submitted that the arrears of promotional scale is not liable to be paid to the petitioner as there is no provisions under the rules for making such payment. The petitioner is claiming gratuity to the tune of Rs. 10.00 lacs as per the prevailing rules while maximum amount of Rs. 3.50 lac is payable to the employee. The petitioner has to be paid earned leave enchashment of 300 days as per the prevailing rules by the Parag Dairy, Noida apart from above, it is pertinent to mention here that petitioner has been paid an amount of Rs. 18,78,174/- towards Employees Provident fund and so far as in respect of Gratuity, GSLI and Earned Leave encashment, it is submitted that as there are audit objections to the tune of Rs. 5,51,059.99 against the petitioner, therefore the amount under the aforesaid heads could not be released.

19. The further submission is that during the year 1997-1998, petitioner has committed irregularities relating to production of Khoya, Milk cake and similarly in the year 1998-1999 also committed irregularities in production of Parag Peda and Paneer due to which financial loss has been caused to the Federation. Thereafter in the year 2008-2009, the petitioner also committed irregularities in purchase of Packaging Material for the products, whose production has already been stopped causing loss of Rs.4,60,835.18 and Rs. 357211.50 to the Federation and accordingly the liability of loss caused to the Federation has been fixed upon the petitioner to the tune of Rs. 21,261.15.

20. An arbitration case (Ankur Mills) is also going on relating to the distribution of the milk and due to pendency of which, the departmental proceedings are kept in abeyance and for which decision is taken on 27.12.2008 in the meeting of Higher Officials of the PCDF and as per the decision of High Officials the departmental proceedings are still pending against the petitioner, which are kept in abeyance till decision of the arbitration case in the matter of Ankur Mills for determining the financial loss caused to the Federation and accordingly the payment of few retiral dues could not be released to the petitioner. Accordingly the departmental enquiry is still pending against the petitioner.

21. The respondents have relied on the judgment passed in Writ Petition No. 254 (S/B) of 2014 (Yamini Bhushan Tripathi Vs. U.P. Power Corporation Limited and others.) in which it has been held that the Gratuity can be curtailed if any financial loss is made to the Government. On the basis of aforesaid submissions the opposite parties have stated that the act of the opposite parties cannot be said to be illegal and unjust as there is no infirmity or illegality in withholding the retiral dues in the light of pending departmental proceedings against the petitioner.

22. The petitioner has filed rejoinder affidavit stating therein that in compliance to the orders of this Court the respondents have paid an amount of Rs. 3,50,000/- towards gratuity and Rs. 25,740/- towards GSLI vide cheque dated 10.7.2014.

23. It has further been stated that respondents cannot take shelter that they are unable to pay the arrears of difference of pay scale pursuant to the recommendation of the 5th Pay Commission for the period from January, 1996 till July 1998 on the ground of bad financial condition of the Milk Union, Kanpur particularly when all the persons similarly situated have been given the arrears of pay revision in pursuance to the recommendation of 5th Pay Commission.

24. It has further been stated that it is an undisputed fact that the gratuity is payable to an employee in accordance with the provisions of Payment of Gratuity Act by revising the limit of gratuity from Rs. 3.5 lacs to Rs. 10 lacs then the answering respondents cannot deny the payment as per the revised limit on the ground that the same is not payable to the employees as the same revised limit is not applicable upon the employees of the PCDF/Centralized Services.

25. In this regard it has been stated that the Division Bench of this Court has allowed the writ petition of the employees of the PCDF when the limit of gratuity was revised to Rs. 3.5 lacs from 2.5 lacs and payment was not made by the answering respondents as per the revised limit. As per rules the petitioner is entitled for 151/2 months salary towards gratuity and this amount comes to Rs.11,06,381.40 and as per the limit increased by the Central Government the petitioner is entitled for the amount of Rs. 10 lac towards gratuity.

26. It has been stated that as regards payment of earned leave encashment for 300 days, the same is being denied by the answering respondents on the ground that according to prevailing rules the same is payable by the Parag Dairy, Noida but the respondents have failed to show any such rules or provision which deny the payment of an employee of the PCDF/ Centralized Services.

27. In this regard it has been stated that the Parag Dairy, Noida is an Unit of the PCDF and the liability of payment of terminal dues rest upon the PCDF. Further as per the prevailing rules the concerned Milk Union used to send the details for the approval/payment by the respondents in regard to the claim for earned leave encashment along with other retiral dues was referred wherein item no. 10 refers to the formalities completed by the Parag Dairy Noida but the respondents are sitting over the matter and they did not make the payment of earned leave encashment.

28. The petitioner has further admitted in the rejoinder affidavit that he has received the payment of Rs. 18.78 lakhs which has been made to the petitioner towards Employees Provident Fund. As regards to the payment of gratuity, GSLI and earned leave it has been submitted that the same has not been paid on the ground that there is an audit objections to the tune of Rs. 5,51,059.00. It is further submitted that this Court has repeatedly held that on the ground of audit objections the terminal dues cannot be withheld. As a matter of fact under the Payment of Gratuity Act a complete mechanism has been given through which payable gratuity of an employee can be forfeited/partly forfeited. It has further been submitted that as per provisions of Section 7 of the Payment of Gratuity Act the gratuity of an employee shall be paid within 30 days and if not paid, interest will accrue there upon subject to the contingencies as given under Section 4(6) of the Payment of Gratuity Act.

29. It has further submitted that none of the exigency has been mentioned in paragraph 6 of the short counter affidavit on the basis of which the same could have been stopped.

30. Regarding the disciplinary proceedings stated by the respondent in their short counter affidavit the petitioner has filed rejoinder affidavit stating therein that as per the prevailing service rules no disciplinary proceedings can be continued/ initiated after superannuation of an employee of a cooperative society in view of the fact that there is no provision in the Uttar Pradesh Cooperative Societies Employees Service Regulations, 1975 which permit the employer to initiate or to continue the disciplinary proceedings after superannuation.

31. The Counsel for the petitioner submitted that the petitioner has retired on attaining the age of superannuation on 31.07.2012 but his all retiral dues have not been paid till date. He submits that the respondents are under legal obligation to pay the entire post retrial dues of the petitioner notwithstanding any disciplinary proceedings allegedly pending against the petitioner in pursuance of the charge sheet dated 07.11.2002 nor on the basis of pending audit objections. He further submits that the opposite parties/respondents have got no justification or authority under law to continue with the disciplinary proceedings after superannuation as there is no enabling provision under the U.P. Cooperative Societies Employees Services Rules, 1975 which is pari materia to Article 351-A of the Civil Services Regulation and as such continuance of disciplinary proceedings or denial of post terminal dues on the ground of pendency of audit objection is wholly without jurisdiction. In this regard the learned Counsel for the opposite parties submitted that the enquiry was instituted while the petitioner was in service and the charge-sheet was issued on 7.11.2002 against the petitioner however subsequently in view of the pendency of an arbitration cases the disciplinary proceedings were kept in abeyance till finalization of the arbitration cases on 27.7.2008, which was during the continuance of the petitioner in service and on account of the pendency of disciplinary proceedings the complete retiral dues can not be paid to the petitioner. He submits that as soon as the arbitration proceedings are over, the departmental proceedings is to be completed and thereafter the decision will be taken for payment of the remaining retiral dues to the petitioner in accordance with law.

32. We have considered the submissions of the parties and gone through the records and found that in the respondents corporation there is no provision of disciplinary proceedings after retirement of the employee. This Court in various judgments have passed order for payment of the retiral dues of the employees holding that since no enquiry can be instituted or continued after retirement of the employee in the absence of Rules and the same cannot be a ground for withholding the retiral dues. We are of the considered view that since there is no provision under the Rules for holding any enquiry after retirement of the employee of the respondents /corporation as the employer-employee relation seizes after retirement. Our view is fortified by the judgment of the Hon'ble Apex Court in Dev Prakash Tiwari Vs. Uttar Pradesh Cooperative Institutional Service Board, Lucknow and others, (2014) 7 Supreme Court Cases 260.

The relevant paragraph 8 of which is reproduced hereunder;-

"Once the appellant had retired from service on 31.03.2009, there was no authority vested with the respondents for continuing the disciplinary proceeding even for the purpose of imposing any reduction in the retiral benefits payable to the appellant. In the absence of such an authority it must be held that the enquiry had laposed and the appellant was entitled to get full retiral benefits."

33. The issue involved in the present writ petition has already been considered by this Court in bunch of writ petition being leading Writ Petition No. 39590 of 2016(Rishi Pal Singh versus State of U.P. and another).

The relevant portion is reproduced hereunder:

"We have considered the submissions raised and having heard learned counsel for the parties, no provision has been pointed out to be available under the U.P. State Warehousing Corporation Staff Regulation, 1961, that may permit the Corporation to proceed to hold disciplinary proceedings and impose any penalty on its employees governed by the aforesaid Regulations under the same after retirement. There is no such provision pari materia with Regulation 351-A of the Civil Services Regulation. The Division Bench in the case of Dhananjay Prasad Pandey (supra) has held as follows:-

"The petitioner was to retire on 31 October 2014 and it appears that for this reason action was taken against the petitioner because the Rules do not permit initiation or continuance of disciplinary proceedings after retirement. The action of the respondents is clearly arbitrary and against the principles of natural justice."

34. The Hon'ble Apex Court, way back in the year 1999 while examining the issue of deduction of any amount from the retiral dues and conduct of a departmental proceeding after superannuation of an employee in the absence of rules in the case of Bhagirathi Jena versus Board of Directors, O.S.F.C and others reported in (1999) 3 SCC 666 held that in view of absence of such a specific provision in the Regulations, the Corporation has no legal authority to make any reduction in the retiral benefits of the appellant. The paragraphs 6 & 7 of the judgment, on reproduction, reads as under:

"6. It will be noticed from the abovesaid regulations that no specific provision was made for deducting any amount from the provident fund consequent to any misconduct determined in the departmental enquiry nor was any provision made for continuance of departmental enquiry after superannuation.

7. In view of the absence of such provision in the abovesaid regulations, it must be held that the Corporation had no legal authority to make any reduction in the retiral benefits of the appellant. There is also no provision for conducting a disciplinary enquiry after retirement of the appellant and nor any provision stating that in case misconduct is established, a deduction could be made from retiral benefits. Once the appellant had retired from service on 30.6.95. there was no authority vested in the Corporation or continuing the departmental enquiry even for the purpose of imposing any reduction in the retiral benefits payable to the appellant. In the absence of such authority, it must be held that the enquiry had lapsed and the appellant was entitled to full retiral benefits on retirement."

35. Relying on the aforesaid, judgment and order has been passed by this Court in the case of S.S.L Verma versus U.P Cooperative Bank Ltd. and others 2004 (22) LCD 659 and Dr. R.B. Agnihotri Versus State of U.P. & others 2000(2) A.W.C 1242 and Writ Petition No.989 of 2010 (P.P Pandey versus State of U.P & others).

36. Relying on several judgments in this regard, similar view has been taken by Hon'ble Supreme Court in Anant R. Kulkarni vs. Y.P. Education Society and others (2013) 6 SCC 515. The relevant paragraph no.34 of the judgment is reproduced hereunder:-

"We may add that the Court has not been apprised of any rule that may confer any statutory power on the management to hold a fresh enquiry after the retirement of an employee. In the absence of any such authority, the Division Bench has erred in creating a post-retirement forum that may not be permissible under law."

37. In view of above discussion, we are of the considered view that no enquiry can be held against the petitioner after his retirement on attaining the age of superannuation. Accordingly, further action in respect of the charge sheet dated 07.11.2002 issued against the petitioner are void after his retirement and the charge sheet is liable to be quashed and the petitioner is entitled for payment of the dues as claimed by him in paragraph 27 of the writ petition with interest.

38. Accordingly, the writ petition is allowed. The chargesheet dated 07.11.2002 contained in Annexure No. 8 to the writ petition is hereby quashed. The respondents are directed to pay the remaining admissible retiral dues to the petitioner alongwith interest at the rate of 9% within a period of six weeks from the date a certified copy of this order is produced.

39. However, allowing the above captioned writ petition, would not prejudice the right of the Corporation to proceed to take action otherwise as permissible in law.

40. No order as to costs.

[ Rajnish Kumar,J.][ Devendra Kumar Arora,J.]

Order Date : 21st December, 2017

Akanksha S.