Allahabad High Court
Committee Of Management, Patel Smarak ... vs State Of Uttar Pradesh And 5 Others on 9 October, 2025
Author: Saurabh Shyam Shamshery
Bench: Saurabh Shyam Shamshery
HIGH COURT OF JUDICATURE AT ALLAHABAD
HIGH COURT OF JUDICATURE AT ALLAHABAD
WRIT - A No. - 6991 of 2025
Committee of Management, Patel Smarak Inter College, Patel Nagar and another
..Petitioners(s)
Versus
State of U.P. and 5 others
..Respondents(s)
Counsel for Petitioners(s)
:
Umesh Vats, Balwant Singh, Sr. Advocate
Counsel for Respondent(s)
:
C.S.C., Satyendra Chandra Tripathi, Shailendra Singh
Court No. - 32
HONBLE SAURABH SHYAM SHAMSHERY, J.
1. Heard Sri G.K. Singh, learned Senior Advocate assisted by Sri Umesh Vats, learned counsel for petitioners and Sri R.K. Ojha, learned Senior Advocate assisted by Sri Shailendra Singh, learned counsel for Respondent-5.
2. This is second round of litigation. Petitioners have earlier approached this Court by way of filing Writ-A No. 1140 of 2025, which was disposed of vide order dated 27.01.2025 by following directions/ observations:
"The concerned DIOS will submit a report as directed in impugned order dated 24.12.2024, within three weeks and thereafter the Joint Director of Education will pass a fresh order including in regard to charge No. 1, 3, 5 and 7 and will pass a consolidated order on basis of facts of the case and in accordance with law, within two weeks thereafter."
3. In aforesaid circumstances, the Joint Director of Education, Gorakhpur decided appeal afresh and by means of impugned order dated 03.05.2025 all charges levelled against Respondent-5 were found not proved. This order is challenged at the behest of Committee of Management of concerned College.
4. This Court has passed following order on 20.05.2025:
1. Heard learned counsel for the petitioners. Learned Standing Counsel appears for respondent nos. 1, 2, 3 and 4. Sri R.K.Ojha, learned Senior Advocate assisted by Sri Shailendra Singh appears for respondent no.5.
2. Issue notice to respondent no.6 returnable within four weeks.
3. Steps be taken within a week.
4. The contention of the learned counsel for the petitioners, inter alia, is that the order impugned has been passed by the appellate authority relying upon the audit report of the audit committee that was appointed by the appellate authority and without giving a copy of the audit report to the petitioners and the documents relied upon by the audit committee, the order impugned has been passed which has resulted in serious prejudice inasmuch as the documents relied upon by the audit committee were unverified. The specific allegation against the respondent no.6 has also been made.
5. The matter requires consideration.
6. Let counter affidavits be filed by the respondents within four weeks. The petitioner shall have two weeks thereafter to file rejoinder affidavit.
7. List thereafter as fresh.
8. Till the next date of listing, the impugned order shall be kept in abeyance.
9. It is made clear that the counter affidavit to be filed by the State-respondents would be by means of a personal affidavit of the Principal Secretary.
5. Learned Senior Advocate for petitioners submits that a copy of Audit Report conducted during proceedings was not provided to petitioners and it is one of the reason that impugned order can be held illegal. Learned Senior Advocate further submits that Appellate Authority has not adhered to the direction passed by this Court by above referred order dated 27.01.2025 since the said Authority has also considered the findings already returned qua to Charges No. 5 and 7, which were already found proved and by means of impugned order said charges were also revisited and now found to be not proved.
6. Learned Senior Advocate appearing for Respondent-5 submits that if the order dated 27.01.2025 passed by this Court is read in its entirety, a liberty was granted to Appellate Authority to look into the said charges also and when direction to conduct audit inspection was not opposed or challenged by petitioners and on basis of Audit Report if concerned charge, i.e., Charge No. 4, was not found proved, therefore, its consequence would also fall on earlier findings qua to Charges No. 5 and 7, hence it was rightly reconsidered.
7. I have considered the above submissions and perused the record.
8. The first issue is, whether Appellate Authority has exceeded or acted contrary to direction passed by this Court vide order dated 27.01.2025.
9. By aforesaid order this Court has directed Appellate Authority to pass a fresh order in regard to Charges No. 1, 3, 5 and 7 and will pass a consolidated order on basis of facts of case. Undisputedly, an attempt was made for modification or clarification of said order at the behest of petitioners, however, it was rejected.
10. From the wordings of said order, it is evident that Court has not barred Appellate Authority not to look into the findings returned so far as Charges No. 5 and 7 are concerned and since admittedly audit inspection was conducted and on basis of report, financial irregularities were not found proved against Respondent-5, which was a basis of Charge No. 5 and for Charge No. 7, the allegation was putting signature by the Respondent-5 in the column earmarked for signature of Manager and from explanation submitted by Respondent-5, said error was correctly found to be not intentional. Therefore, Appellate Authority has not committed error while revisiting the findings with regard to Charges No. 5 and 7. Therefore, this objection of petitioners is rejected.
11. Now the second issue is the consequence of not supplying a copy of Audit Report and not to invite objections from petitioners on said report as well as what prejudice is caused to petitioner.
12. From perusal of record, it is evident that audit inspection was conducted on the direction of concerned State-Respondent. The said direction was not challenged at the behest of petitioners, therefore, has attained finality.
13. From impugned order, it is also clearly evident that Audit Committee was comprised of two Auditors from the office of Joint Director of Education, Gorakhpur, therefore, their bona fide could not be disputed. It is also clearly mentioned in impugned order that Audit Committee went to the institution on 05.04.2025 and Manager/ Secretary of petitioners Society has provided all documents from the office to the said Committee. Therefore, the documents verified are also not under dispute.
14. There is nothing on record that petitioners at any stage during proceedings before Appellate Authority or during audit inspection, have objected or asked for any clarification, therefore, now they cannot come before this Court that they have prejudiced since copy was not supplied. In order to show that petitioners have suffered prejudice, they have to show atleast some substance that out come of audit report was perverse or absolutely contrary to record. In this regard the Court takes note of contents of paragraphs no. 53, 76 and 77 of writ petition, which are reproduced hereinafter:
53. That as per Audit Report the respondent no. 5 submitted Bill voucher only for embezzlement amount before audit team and audit team relying upon the alleged bill voucher submitted his report before Joint Director of Education (Respondent No. 2). The entry of alleged bill vouchers was not done in the Cash Book. The audit team did not verify the alleged bill vouchers from the Committee of Management or the Principal of the Institution. The audit team also didn't verify the alleged bills from the issuing agency/shop owner and relying upon the alleged bill and submitted its report in collusion with respondent no. 5. The audit report was never supplied to the petitioner nor given an opportunity of hearing the petitioner or verifying the alleged bill voucher. It appears the alleged forged Bill Vouchers has been prepared for giving benefit to the respondent no. 5.
76. That from the bare perusal of the record of cash book, fees collection register it is evident that in academic session 2020-2021 the fees collection was sum of Rs. 4,67,574/- while expenses of the said academic session of 2020-2021 was only Rs. 1,75,015/-. He deposited sum of Rs. 1,52,332/- in the bank. Therefore, total financial embezzlement made by the respondent no. 5 was sum of Rs. 1,40,227/- It is further submitted that the total fees collection of academic session 2021-2022 was sum of Rs. 5,83405/-, while expenses made by the respondent no. 5 in academic session 2021-2022 was sum of Rs. 2,8541/- which was deposited in bank account and Rs. 257937/-was kept in hand Remaining amount Rs. 1,16,927/- was made embezzlement by the respondent no. 5 which is evident from the cash book and fees collection register for the academic session year 2020-2021 and 2021-2022 which have been maintained by respondent no. 5 himself. For kind perusal of this Hon'ble Court, true copy of the collection fees register and cash book is being filed as ANNEXURE NO. 32 to this writ petition.
77. That from the bare perusal of the record of cash book, fees collection register it is evident that in academic session 2020-2021 the fees collection was sum of Rs. 4,67,574/- while expenses of the said academic session of 2020-2021 was only Rs. 1,75,015/-. He deposited sum of Rs. 1,52,332/- in the bank. Therefore, total financial embezzlement made by the respondent no. 5 was sum of Rs. 1,40,227/- which is also evident from the reply given by the respondent no.5 before the inquiry committee and other respondents. It is further submitted that the total fees collection of academic session 2021-2022 was sum of Rs. 5,83405/-, while expenses made by the respondent no. 5 in academic session 2021-2022 was sum of Rs 20,8541/-which was deposited in bank account and Rs. 257937/- was kept in hand Post Remaining amount Rs. 1,16,927/- was made embezzlement by the respondent no. 5 which is evident from the cash book and fees collection register for the academic session year 2020-2021 and 2021-2022 which have been maintained by respondent no. 5 himself. The respondent no.5 has stated first time before the Audit Committee that amount Rs. 30030 was collected but it was kept by class IV employee Jay Prakash, and which was never given to him. The finding of the respondent no. 2 regarding the charge no. 4 is absolutely perverse and against record.
15. In above background, the Court takes note of a judgment passed by Supreme Court in Union of India and others Vs. Dilip Paul, 2023 SCC OnLine SC 1423, wherein principle of test of prejudice in service, jurisprudence was considered and relevant paragraph Nos. 59 and 60 are reproduced hereinafter :-
i) Principle of Test of Prejudice in Service Jurisprudence
59. The test of prejudice is a well settled canon of law that may be applied where any procedural impropriety or violation of rule of audi alteram is alleged. This Court in State Bank of Patiala v. S.K. Sharma, (1996) 3 SCC 364 held that the test is to ascertain whether the violation of such procedure or process resulted in a prejudice being caused or a loss of fair hearing. The relevant observations are reproduced below:-
11. ...Does it mean that any and every violation of the regulations renders the enquiry and the punishment void or whether the principle underlying Section 99 CPC and Section 465 CrPC is applicable in the case of disciplinary proceedings as well. In our opinion, the test in such cases should be one of prejudice, as would be later explained in this judgment. But this statement is subject to a rider. The regulations may contain certain substantive provisions, e.g., who is the competent authority to impose a particular punishment on a particular employee/officer. Such provisions must be strictly complied with. But there may be any number of procedural provisions which stand on a different footing. We must hasten to add that even among procedural provisions, there may be some provisions which are of a fundamental nature in the case of which the theory of substantial compliance may not be applicable. For example, take a case where a rule expressly provides that the delinquent officer/employee shall be given an opportunity to produce evidence/material in support of his case after the close of evidence of the other side. If no such opportunity is given at all in spite of a request therefor, it will be difficult to say that the enquiry is not vitiated. But in respect of many procedural provisions, it would be possible to apply the theory of substantial compliance or the test of prejudice, as the case may be. The position can be stated in the following words : (1) Regulations which are of a substantive nature have to be complied with and in case of such provisions, the theory of substantial compliance would not be available. (2) Even among procedural provisions, there may be some provisions of a fundamental nature which have to be complied with and in whose case, the theory of substantial compliance may not be available. (3) In respect of procedural provisions other than of a fundamental nature, the theory of substantial compliance would be available. In such cases, complaint/objection on this score have to be judged on the touchstone of prejudice, as explained later in this judgment. In other words, the test is : all things taken together whether the delinquent officer/employee had or did not have a fair hearing. We may clarify that which provision falls in which of the aforesaid categories is a matter to be decided in each case having regard to the nature and character of the relevant provision.
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28. In our respectful opinion, the principles emerging from the decided cases can be stated in the following terms in relation to the disciplinary orders and enquiries : a distinction ought to be made between violation of the principle of natural justice, audi alteram partem, as such and violation of a facet of the said principle. In other words, distinction is between no notice/ no hearing and no adequate hearing or to put it in different words, no opportunity and no adequate opportunity. To illustrate take a case where the person is dismissed from service without hearing him altogether (as in Ridge v. Baldwin ([1964] A.C. 40 : [1963] 2 All ER 66 : [1963] 2 WLR 935]). It would be a case falling under the first category and the order of dismissal would be invalid or void, if one chooses to use that expression (Calvin v. Carr [[1980] A.C. 574 : [1979] 2 All ER 440 : [1979] 2 WLR 755, PC]). But where the person is dismissed from service, say, without supplying him a copy of the enquiry officer's report (Managing Director, ECIL v. B. Karunakar [(1993) 4 SCC 727 : 1993 SCC (L&S) 1184 : (1993) 25 ATC 704]) or without affording him a due opportunity of cross-examining a witness (K.L. Tripathi [(1984) 1 SCC 43 : 1984 SCC (L&S) 62]) it would be a case falling in the latter category violation of a facet of the said rule of natural justice in which case, the validity of the order has to be tested on the touchstone of prejudice, i.e., whether, all in all, the person concerned did or did not have a fair hearing. It would not be correct in the light of the above decisions to say that for any and every violation of a facet of natural justice or of a rule incorporating such facet, the order passed is altogether void and ought to be set aside without further enquiry. In our opinion, the approach and test adopted in B. Karunakar [(1993) 4 SCC 727 : 1993 SCC (L&S) 1184 : (1993) 25 ATC 704] should govern all cases where the complaint is not that there was no hearing (no notice, no opportunity and no hearing) but one of not affording a proper hearing (i.e., adequate or a full hearing) or of violation of a procedural rule or requirement governing the enquiry; the complaint should be examined on the touchstone of prejudice as aforesaid.
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33. We may summarise the principles emerging from the above discussion. (These are by no means intended to be exhaustive and are evolved keeping in view the context of disciplinary enquiries and orders of punishment imposed by an employer upon the employee):
(1) An order passed imposing a punishment on an employee consequent upon a disciplinary/departmental enquiry in violation of the rules/regulations/statutory provisions governing such enquiries should not be set aside automatically. The Court or the Tribunal should enquire whether (a) the provision violated is of a substantive nature or (b) whether it is procedural in character.
(2) A substantive provision has normally to be complied with as explained hereinbefore and the theory of substantial compliance or the test of prejudice would not be applicable in such a case.
(3) In the case of violation of a procedural provision, the position is this : procedural provisions are generally meant for affording a reasonable and adequate opportunity to the delinquent officer/employee. They are, generally speaking, conceived in his interest. Violation of any and every procedural provision cannot be said to automatically vitiate the enquiry held or order passed. Except cases falling under no notice, no opportunity and no hearing categories, the complaint of violation of procedural provision should be examined from the point of view of prejudice, viz., whether such violation has prejudiced the delinquent officer/employee in defending himself properly and effectively. If it is found that he has been so prejudiced, appropriate orders have to be made to repair and remedy the prejudice including setting aside the enquiry and/or the order of punishment. If no prejudice is established to have resulted therefrom, it is obvious, no interference is called for. In this connection, it may be remembered that there may be certain procedural provisions which are of a fundamental character, whose violation is by itself proof of prejudice. The Court may not insist on proof of prejudice in such cases. As explained in the body of the judgment, take a case where there is a provision expressly providing that after the evidence of the employer/ government is over, the employee shall be given an opportunity to lead defence in his evidence, and in a given case, the enquiry officer does not give that opportunity in spite of the delinquent officer/employee asking for it. The prejudice is self-evident. No proof of prejudice as such need be called for in such a case. To repeat, the test is one of prejudice, i.e., whether the person has received a fair hearing considering all things. Now, this very aspect can also be looked at from the point of view of directory and mandatory provisions, if one is so inclined. The principle stated under (4) hereinbelow is only another way of looking at the same aspect as is dealt with herein and not a different or distinct principle.
(4)(a) In the case of a procedural provision which is not of a mandatory character, the complaint of violation has to be examined from the standpoint of substantial compliance. Be that as it may, the order passed in violation of such a provision can be set aside only where such violation has occasioned prejudice to the delinquent employee.
(b) In the case of violation of a procedural provision, which is of a mandatory character, it has to be ascertained whether the provision is conceived in the interest of the person proceeded against or in public interest. If it is found to be the former, then it must be seen whether the delinquent officer has waived the said requirement, either expressly or by his conduct. If he is found to have waived it, then the order of punishment cannot be set aside on the ground of the said violation. If, on the other hand, it is found that the delinquent officer/employee has not waived it or that the provision could not be waived by him, then the Court or Tribunal should make appropriate directions (include the setting aside of the order of punishment), keeping in mind the approach adopted by the Constitution Bench in B. Karunakar [(1993) 4 SCC 727 : 1993 SCC (L&S) 1184 : (1993) 25 ATC 704]. The ultimate test is always the same, viz., test of prejudice or the test of fair hearing, as it may be called.
(5) Where the enquiry is not governed by any rules/ regulations/statutory provisions and the only obligation is to observe the principles of natural justice or, for that matter, wherever such principles are held to be implied by the very nature and impact of the order/action the Court or the Tribunal should make a distinction between a total violation of natural justice (rule of audi alteram partem) and violation of a facet of the said rule, as explained in the body of the judgment. In other words, a distinction must be made between no opportunity and no adequate opportunity, i.e., between no notice/no hearing and no fair hearing. (a) In the case of former, the order passed would undoubtedly be invalid (one may call it void or a nullity if one chooses to). In such cases, normally, liberty will be reserved for the Authority to take proceedings afresh according to law, i.e., in accordance with the said rule (audi alteram partem). (b) But in the latter case, the effect of violation (of a facet of the rule of audi alteram partem) has to be examined from the standpoint of prejudice; in other words, what the Court or Tribunal has to see is whether in the totality of the circumstances, the delinquent officer/employee did or did not have a fair hearing and the orders to be made shall depend upon the answer to the said query. [It is made clear that this principle (No. 5) does not apply in the case of rule against bias, the test in which behalf are laid down elsewhere.]
(6) While applying the rule of audi alteram partem (the primary principle of natural justice) the Court/Tribunal/Authority must always bear in mind the ultimate and overriding objective underlying the said rule, viz., to ensure a fair hearing and to ensure that there is no failure of justice. It is this objective which should guide them in applying the rule to varying situations that arise before them.
(7) There may be situations where the interests of State or public interest may call for a curtailing of the rule of audi alteram partem. In such situations, the Court may have to balance public/State interest with the requirement of natural justice and arrive at an appropriate decision.
60. In the case of State of U.P. v. Harendra Arora, (2001) 6 SCC 392, this Court further expanded the applicability of the Test of Prejudice to even procedural provisions which are fundamental in nature with the following relevant observations being reproduced below:--
13. The matter may be examined from another viewpoint. There may be cases where there are infractions of statutory provisions, rules and regulations. Can it be said that every such infraction would make the consequent action void and/or invalid? The statute may contain certain substantive provisions, e.g., who is the competent authority to impose a particular punishment on a particular employee. Such provision must be strictly complied with as in these cases the theory of substantial compliance may not be available. For example, where a rule specifically provides that the delinquent officer shall be given an opportunity to produce evidence in support of his case after the close of the evidence of the other side and if no such opportunity is given, it would not be possible to say that the enquiry was not vitiated. But in respect of many procedural provisions, it would be possible to apply the theory of substantial compliance or the test of prejudice, as the case may be. Even amongst procedural provisions, there may be some provisions of a fundamental nature which have to be complied with and in whose case the theory of substantial compliance may not be available, but the question of prejudice may be material. In respect of procedural provisions other than of a fundamental nature, the theory of substantial compliance would be available and in such cases objections on this score have to be judged on the touchstone of prejudice. The test would be, whether the delinquent officer had or did not have a fair hearing....
16. As referred above, in the present case though admittedly a copy of Audit Report was not supplied to petitioners, however, the Court is of the opinion that petitioners cannot dispute the outcome of Audit Report since it was based on documents supplied by petitioners themselves. The objections made in writ petition, as referred above, are not substantive rather vague in nature. Respondent-5 has suffered with detailed inquiry on basis of orders passed by this Court and Appellate Authority passed a very detailed and reasoned order. The Court is of the opinion that it is not a case where petitioners are prejudice due to non supply of Audit Report and since a categorical finding was returned by Appellate Authority that none of the charges are found proved, therefore, no interference is called for under writ jurisdiction.
17. The writ petition is accordingly dismissed. Interim order is vacated.
18. Respondent-5 shall remain under a legal obligation not to commit any financial irregularity and directed to deal all financial matters with utmost sincerity and honesty.
October 09, 2025
AK
