C. Ramakant Naidu vs Maharashtra State Electricity ...
2005 Latest Caselaw 716 Bom

JUDGMENT

Dharmadhikari B.P., J.

1. The petitioner a retired employee of the respondents seeks benefit of General Order No. 74 with consequential benefits of release thereof from 1-6-1982, along with interest. The said General Order 74, makes a provisions for grant of benefit of next higher grade in view of the stagnation after six years of service on lower post.

2. Admittedly, the petitioner has retired on superannuation on 31-5-1990 and at that time he was working as Assistant Accountant at Koradi Thermal Power Station, near Nagpur. His employer is Maharashtra State Electricity Board. The petitioner was initially appointed as L.D.C. in the then Madhya Pradesh State Electricity Board from 25-03-1955, and after the re-organization of States, the petitioner came on establishment of Maharashtra State Electricity Board. The petitioner got promotion as Upper Division Clerk on 30-8-1961 and in 1975, the respondent effected certain promotions to next higher post i.e. of Assistant Accountant. The petitioner was considered at that time and as he was non-matriculate, he was denied that promotion. On the ground of educational qualification, the said benefits were not released by the Chairman, Maharashtra State Electricity Board. The petitioner therefore, filed a complaint in this respect before the Conciliation Officer under the provisions of the Industrial Disputes Act, and after failure, reference in this respect was made to the Industrial Court at Nagpur. The Industrial Court delivered an award in Reference (IT) No. 1/1978, and restored the promotion order dated 17-9-1975, in favour of the petitioner with all consequential benefits from that date. Accordingly the respondent promoted the petitioner in the cadre of Assistant Accountant w.e.f. 17-09-1975.

3. The respondents in the year 1974 issued General Order 74, which permitted grant of higher grades to the employees who have continued on the same post for 10 years or more as on 1-5-1974. The said order was issued on the eve of 14th Anniversary of the formation of the State of Maharashtra, and its intention was to give some relief to the employees who were facing stagnation for want of availability of vacancies in next promotional cadre. The said G.O. provided that the employees who are otherwise fit for promotion would be given benefits thereunder. The petitioner contended that, he was never communicated any adverse remark and he did not suffer any punishment and further he was not reverted at any time. He further stated that his service record was clean and unblemished and he also did not receive any memo or warning during entire span of his service. He therefore, was entitled to grant of next higher grade as per this General Order. The said General Order was modified on 09-01-1980, by issuing correction Slip No. 4, and benefit thereof was also extended to the employees who did not possess requisite academic qualification for next higher post. Similarly, on 6-5-1983 another correction was made in it, and the period of 10 years was reduced to 6 years w.e.f. 1-4-1980 by issuing correction Slip No. 9. The petitioner states that he attained the age of 45 years and accordingly, applied for exemption from passing departmental Higher Accounts Examination in accordance with the provisions of C.S. No. 10 dated 09-06-1982. He was granted that exemption w.e.f. 1-6-1982 and thus he was deemed to have cleared the said Departmental Examination on 1-6-1982. The said order was issued by the respondent on 15-10-1985.

4. It is the case of the petitioner that he was in fact working as Divisional Accountant i.e. next higher post and he was also given special pay in addition to his pay as Assistant Accountant for this work. It is his contention that inspite of this benefits of G.O. 74 was not released in his favour. He made various representations for that purpose, but he did not receive any communication from his employer about the fate thereof. The petitioner states that on 16-10-1990, he was communicated by the respondents that his case was placed before the Competent Selection Committee for grant of said benefits, and as the said Committee allegedly found that confidential reports of petitioner were unsatisfactory till date of his superannuation i.e. 31-5-1990, he could not be given benefits of G.O. 74. The petitioner states that there were no such adverse confidential reports, and he further states that in any case the same were never communicated to him. He further contends that because of the Court case filed by him and the order of the Industrial Court in his favour, the respondents have acted with mala fides and with revengeful attitude and he has been victimised. It is in this background that he has sought above mentioned benefits.

5. The reply of respondent is that of denial. They have simply stated that the case of petitioners was considered by the competent Selection Committee after his retirement and the said Committee found that he was not eligible for grant of the said benefits. The respondent has stated that the competent Selection Committee considered his case for grant of such benefits w.e.f. 1-6-1982, and this was done on 13-8-1990. It is further stated that the said Selection Committee has considered the confidential reports and found that the same were not satisfactory. It is the contention of the respondent that simply because they did not have evidence to show that adverse remarks were communicated to the petitioner, that does not mean that their exist no such remarks in the confidential reports. In the alternative it was also contended that it was not necessary to communicate the adverse remark and that, the uncommunicated adverse remarks can also be looked into while considering the case of the petitioner. It is also stated that the petitioner was not possessing essential minimum qualification i.e. He was not graduate, and as such he was not entitled to grant of benefits of G.O. 74.

6. We have heard Advocate M.B. Agasti, for petitioner and Advocate R.K. Deshpande, for respondents.

7. Mentioning the facts as discussed above, Advocate Agasti has stated that the case of petitioner ought to have been considered immediately after completion of 6 years by him as Assistant Accountant, and the respondents have deliberately considered the matter only once i.e. after his superannuation. He further stated that there were no adverse remarks at all and no such adverse remarks were communicated to the petitioner at any point of time. He contends that therefore, the competent Selection Committee could not have, in any case considered such adverse remarks. He further contends that the fact that petitioner cleared the departmental promotional examination on 1-6-1982, in view of the exemption given. He further contends that the actual work put in by the petitioner is as Divisional Accountant is not denied and that also is overlooked. He further states that the order of the Industrial Court declaring him as entitled to the pay of Assistant Accountant w.e.f. 17-9-1975 is also been overlooked. He contends that all this has been done with oblique motive and only with an intention to victimise the employee. He has place reliance upon the judgment of the Apex Court (Brij Mohan Singh Chopra v. State of Punjab), (Baikunth Nathdas and Anr. v. Chief District Medical Officer and Anr.), 1988(Supp.) S.C.C. 674, (Vijay Kumar v. State of Maharashtra and Ors.), , (A.P. Angadi v. Maharashtra State Electricity Board].

8. Against this, Advocate R.K. Deshpande, for respondents, has stated that the petitioner has not challenged the proceedings of the competent Selection Committee and the competent Selection Committee has recorded that there are adverse remarks in the confidential report of the petitioner. He contends that in the absence of challenge to these proceedings. It is clear that the adverse remarks existed in service record of petitioner and the competent Selection Committee has found the petitioner not eligible on account of the same. He therefore, contends that non-communication of those adverse remarks is not relevant and while granting promotion even uncommunicated adverse remarks can be used by the employer. In support of his contention, he has placed reliance upon the judgment of the Hon'ble Apex Court reported in 1970 S.L.R. (S.C.) 116 (Prakash Chandra Sharma v. Oil & Natural Gas Commission and Ors.); (supra), and also upon the provisions of the General Order 74, in this respect. He contends that over all performance and service record of the petitioner is required to be seen and the competent Selection Committee has reached the decision after going through the same. He therefore, contends that no interference in the matter is called for and the writ petition as filed deserves to be dismissed.

9. At this juncture it would be appropriate to refer to the provisions of G.O. 74. The Original G.O., as framed on 13-4-1974 stated that the Board i.e. the Maharashtra State Electricity Board, decided to extend special benefits to such of the Board employees who remain on same post for 10 years or more without the advantage of promotion to a higher post or higher grade for want of clear vacancies against which they could have been promoted or against the cadre to which they belong did not provide for any further promotional channel. It was further stated that such employees would get higher grade, provided they have not (?) necessary qualification and experience, required for the higher grade. The G.O. provided that such employee should be otherwise fit for promotion on the basis of over all performance and he should have passed necessary examinations prescribed by the Board. Even in case of employees who were awarded punishment of reversion, the G.O. stated that such employees could be considered after expiry of two years from the date of reversion and in case of other punishment, it provided that, such employees would be considered after the punishment period is over. The employees against whom disciplinary action/proceedings were pending were to be considered after the final decision thereof. The proforma of proposal for grant of such higher grade accompanying G.O. 74 mentions other details, required information, whether the employee concerned was considered for promotion earlier and whether he was found fit therefor or not. Further information required to be submitted is in relation to the departmental enquiry for confidential directives pending and about the punishment. The Correction Slip No. 4, issued on 09-01-1980, stated that the employees who did not have prescribed academic qualification for next higher post were not being considered in G.O. 74. However, by the said correction slip, it was prescribed that the competent Selection Committee was empowered to select candidates who did not possess requisite qualification, but possess requisite experience and good confidential reports, subject to relaxation of qualification by the competent authority. Thus, when Selection Committee could select candidates for regular promotion, the Board thought it fit to extend similar facilities for conferring benefits under G.O. 74 also and the competent Selection Committee was accordingly empowered to consider the claims of those who possess requisite qualification and experience, but also of those who do not possess such qualification. The competent Selection Committee could recommend relexation of qualification of such persons for grant of benefits under G.O. 74. The competent Selection Committee was to meet periodically for such consideration. Later on the period of 10 years was brought down to 6 years, by Correction Slip No. 9 dated 6-5-1983, w.e.f. 1-4-1980.

10. This G.O. is considered by the Division Bench of this Court in a ruling between A.P. Angadi v. Maharashtra State Electricity Board, Bombay, reported in 2003(4) Bom.C.R. 23 : 2003(3) Mh.L.J. 715. In paragraph No. 8 thereof, the Division Bench has mentioned the observations of other Division Bench of this Court in Appeal No. 892/1991, between (M.S.E.B. v. Dinkar Sane), decided on 29-3-1993. In this paragraph No. 8, paragraph No. 5 of judgment in Appeal No. 892/1991 has been quoted and the said paragraph No. 5 reads as under :

"5. A plain reading of the General Order makes it clear that the Board was desirous of extending special benefit to such employees who remained in the given post for 10 years or more and was denied advantage of promotion to a higher post for no fault of theirs. The denial of promotion is either because of want of clear vacancies or the cadre did not provide for any channel of promotion. In either case the employee could not be promoted for no fault of his and the Board felt that even if the promotion to a higher post is not possible, the employees can be given benefit of higher grade. (with this object of the rules it is clear that when an employees, as soon as he complete service of 10 years in a particular post, could not be promoted because of want of clear vacancy of no availability of promotional channel then benefit of higher grade should be made forthwith but on condition that such employee had not disentitled himself from securing promotion for any other reason. In case the employee is guilty of any charge or the confidential record of such employee indicates that he is misfit for promotion or the employee has not passed the necessary examination then in such case the employee cannot demand higher grade as a matter of right. The board cannot deny advantage of higher grade in case of employee is not disentitled by any reason from being considered for promotion to the higher posts. It is not open for the appellant to consider the comparative merits of the employees who are entitled to higher grade and then determine to whom the higher grade should be awarded. The higher grade should be available to each and every employee who falls within the scope of the General Order. It is possible that there may be more that one employee who is entitled to the higher grade because of completion of 10 years or more in a given post and not being promoted to the higher post because of want of clear vacancies or lack of promotional avenues. In such cases each and every employee is entitled to higher grade. It is not open for the board to consider at the time of entitlement to higher grades as to whether such employee will be promoted at the time when the actual vacancies arises. It is possible that there may be nothing adverse against an employee at the time of completion of his 10 years of service in a given post but the service record may be adverse at the time when occasion comes to grant promotion and at the time it is open for the Board to consider whether an employee who has been provided with higher grade is also entitled to actual promotion. In our judgment, looking to the object of the General Order and the impact of the rules, it is clear that an employee is entitled to the higher grade provided such employee is not found unfit for promotion at the time of completion of 10 years of his service in a given post. An employee is unfit for promotion provided he is not holding the necessary qualification or disciplinary proceedings are pending against him or action has been taken in pursuance of the disciplinary proceedings disentitling him for being considered for promotion. We refer only to illustrative cases and the board shall not deny advantage of the circular to the employee unless there is a positive material to hold that the employee has disentitled himself from consideration for promotion. In our judgment, this is a proper approach to apply the advantage of the General Order. The observations made by the trial Judge, in respect of the ambit of the circular are set aside and the Board must give effect to the circular in accordance with the observations made in this judgment."

On the basis of these observations, in paragraph No. 9 the Division Bench has concluded, as under :

"9. Considering G.O. No. 7, the Division Bench of this Court observed that the respondent M.S.E.B. shall not deny advantage of the circular to the employee unless there is positive material to hold not the employee has disentitled himself from consideration of promotion. The petitioner here holds necessary qualification for promotion to the post of Senior Executive Engineer (Generation). No disciplinary proceeding was pending against him on the relevant date. The petitioner did not suffer punishment in any disciplinary proceedings. He was not communicated any adverse remarks in confidential record. His rating by the Selection Committee for the relevant period i.e. five years immediately preceding 13-6-1986 shows a least 'Good'. We are, thus satisfied that petitioner has been wrongly denied the benefit of higher pay scale of Senior Executive Engineer (Generation) with effect from 13-6-1986."

11. Thus, from the observations of the two Division Bench quoted above. It is clear that the employee should not be found unfit for promotion and a employee is not fit for promotion if he is not holding necessary qualification or disciplinary proceedings are pending against him. The relaxation from qualification for grant of next higher grade as per G.O. 74, is already pointed out above. Thus, it is clear that as observed by both the Division Benches, there has to be some positive material with M.S.E.B. to hold that the employe is disentitled from consideration for grant of such benefits. M.S.E.B. cannot deny advantage of said G.O. to petitioner in the absence of such positive material. In the facts of the present case, the petitioner was found not qualified and on that count he was denied promotion as Assistant Accountant. He challenged that denial in conciliation proceedings, and ultimately in Reference IT No. 1/1978, the learned Member of the Industrial Court, directed the respondent M.S.E.B., to restore the promotion upon petitioner as Assistant Accountant w.e.f. 17-9-1975 with all consequential benefits. Thus the petitioner was given that promotion and designation and he retired on superannuation on 31-5-1990, as Assistant Accountant only. In the petition the petitioner has expressly mentioned that he was infarct working on the post of Divisional Accountant at the time of his superannuation, in paragraph No. 1 and also paragraph No. 8. In paragraph No. 8, he has expressly mentioned that he was designated that duties of Divisional Accountant. In paragraph No. 13, he has also mentioned that the respondent No. 3 has issued order granting special pay in addition to pay of Assistant Accountant, because he was performing the duties of Divisional Accountant. This order dated 28-7-1988 is produced by the petitioner as Annexure 7, with the petition. In so far as this specific assertions are concerned, the same are not denied by the respondents any where in their return. Thus it is more clear that the petitioner was in fact working on a higher post of Divisional Accountant at the time of his superannuation. The entire controversy needs to be viewed in this background.

12. Reason for denying benefit of G.O. 74 as mentioned in impugned communication dated 16 October, 1990, is that the confidential reports of petitioner were not found satisfactory and as such petitioner could not be given said benefit from the due date till the date of his retirement. Advocate Deshpande for board has argued that the petitioner has not challenged this finding of Selection Committee and further he has also alleged that adverse remarks in his confidential reports have not been communicated to him. He states that in return filed on affidavit before this Court the Board has specifically stated that there were adverse remarks in confidential reports of petitioner and the petitioner has not filed any counter affidavit thereafter denying existence of such adverse remarks. He contends that the petitioner ought to have filed counter affidavit mentioning therein that there were no such adverse remarks in his confidential reports. According to him, petitioner has .admitted existence of adverse remarks and communication of such adverse remarks to petitioner was therefore not necessary. He further argued that even otherwise adverse remarks need not be communicated while considering the case of petitioner for promotion. He states that simply because there is no evidence available with Board to show that adverse remarks have been communicated, that does not mean that adverse remarks did not exist. However, perusal of petition reveals that this argument is actually incorrect. In paragraph 3 of his petition, petitioner has specifically stated that he was never involved in any misconduct and his service record till superannuation was absolutely clean and unblemished. He has further stated that he did not suffer any punishment and never received any memo or warning during entire span of his service. In paragraph 5 he had stated that he never received any adverse remarks or any adverse report nor there was any complaint from his superiors. In paragraph 15, petitioner pleades that "It is submitted that without admitting but assuming the confidential reports of petitioner to be adversed then the same should have been communicated to him from time and again." All these assertions of petitioner clearly reveal the case that petitioner is denying existence of adverse remarks in his confidential records. The plea that he was never communicated any such adverse remarks is clearly by way of abundant precaution and in the alternative. It was therefore necessary for respondent Board to show that the service record of petitioner really carried any such adverse remarks. No such adverse remarks are produced before this Court and also not pointed out in the return/reply. The Board has only tried to capitalise on mention thereof in the impugned communication dated 16 October, 1990. Board has also expressed readiness and willingness to produce original record of Selection Committee before this Court in proof of existence of adverse remarks. Perusal of said report of Selection Committee does not reveal the nature, type or the years during which petitioner earned those adverse remarks. The petitioner became due for consideration of benefit of G.O. 74 on 1-6-1982 and his case has been considered by Selection Committee only on 30-8-1990 i.e. after three months of his superannuation. The impugned communication mentions that said Selection Committee considered eligibility of petitioner between period 1-6-1982 to 31-5-1990. In the background mentioned above, it was obligatory for Board to produce said confidential record itself before this Court. In the return, Board has not taken the stand that confidential record of petitioner is destroyed. The only stand is this that Board has no record/evidence to show that adverse remarks were communicated to the petitioner. It cannot be forgotten that petitioner was denied promotion as Assistant Accountant way back in 1975 and he got the justice and said promotion only after adjudication by Industrial Court. The order in compliance with award of Industrial Court has been passed by respondent board on 31st May, 1984. The exemption from appearing in necessary departmental examination for further promotion has been given to petitioner by order dated 15th October, 1985, retrospectively with effect from 1-6-1982. Even after impugned order dated 16 October, 1990, particularly in above background, the respondents ought not to have destroyed the records of petitioner immediately. The instant petition has been filed on 25-4-1991 and Board appeared in this matter within one year. It was therefore obligatory for board to file appropriate affidavit giving of the circumstances in which the record of petitioner came to be destroyed as alleged. The board ought to have pointed out relevant rule/regulation or practice consistently followed by it about destruction of such records. The very fact that the respondent is relying only on minutes of Selection Committee creates a doubt about the bona fides of the respondents Board in this respect. In the absence of necessary details, the plea of respondent that it has destroyed the records cannot be accepted. Adverse inference needs to be drawn against the board for such non-production of relevant records and for not furnishing details thereof. It is not possible for us to accept the contention that confidential records of petitioner contained any adverse remarks.

13. It is interesting to note that in reported judgment between A.P. Angadi v. Maharashtra State Electricity Board (supra), the respondent Board had taken the stand that case, of petitioner therein was considered on four different occasions but he was not found fit for promotion and therefore was not eligible to higher scale. There also the Division Bench wanted to go through the material in confidential roll of petitioner and the Board came up with the plea that confidential reports of that petitioner had been destroyed. The Division Bench found that therefore there was no material to show that petitioner there was not suitable for higher pay scale. The Division Bench refused to accept the defence of Board in the absence of original record. We are also placed in similar situation and in the absence of any material on record and in view of history of the matter, we are not inclined to presume existence of any adverse remarks in the confidential record of petitioner before us. In the reported case, from paragraph 3 of judgment it appears that the board took the defence that Selection Committee adopted the criteria that such employee ought to have overall grading of "very good" for two years and "good" for three years. The Division Bench found this criteria inconsistent with G.O. 74 and the Rules framed there under. Thus the perusal of confidential records of present petitioner assumes importance. As, we have not accepted the existence of adverse remarks in the service record of petitioner, it is really not necessary for us to go into the question of need of communicating such adverse remarks to the petitioner. However both the Counsels have advanced considerable arguments on this issue and hence the same is being considered.

14. In A.I.R. 1987 S.C. 948, between Brij Mohan Singh Chopra v. State of Punjab, the Hon'ble Apex Court has considered the issue of requirement of communication of adverse remarks to the employee for the purposes of compulsory retirement and has found that the adverse remarks must be communicated and representation, if any, preferred against the same by employee must be disposed of before taking into account such adverse remarks to deny promotion. It has been held that the same considerations will apply even in the matter of premature retirement. This is in view of principles of natural Justice and after placing reliance upon the other judgment of Hon Supreme Court reported at A.I.R. 1979 S.C. 162, to between (Gurudial Singh Fijji v. State of Punjab), paragraphs 9 and 10 of Brij Mohan Singh's case read as under :

"9. The question which falls for consideration is whether the aforesaid two entries could be taken into consideration informing the requisite opinion to retire prematurely the appellant from service. There is no doubt that whenever an adverse entry is awarded to a Government servant it must be communicated to him. The object and purpose underlying the communication is to afford an opportunity to the employee to improve his work and conduct and to make representation to the authority concerned against those entries. If such a representation is made it is imperative, that the authority should consider the representation with a view to determine as to whether the contents of the adverse entries are justified or not. Making of a representation is a valuable right to a Government employee and if the representation is not considered, it is bound to affect him in his service career as in Government, service grant of increment, promotion and ultimately premature retirement all depend on the scrutiny of the service records. In Gurdial Singh Fijji v. State of Punjab, , the appellant therein was denied promotion on account of certain adverse entries against which he had made representation to the Government but for some reason or the other those representations could not be considered or disposed of. In view of those adverse entries he was not selected for promotion. This Court while considering the effect of non-consideration of the representation observed at 1626 of A.I.R.

"The principal is well settle that in accordance with the rules of natural Justice, an adverse report in confidential roll cannot be acted upon to deny promotional opportunities unless it is communicated to the person concerned so that he has an opportunity, to improve his work and conduct or to explain the circumstances leading to the report. Such an opportunity is not an empty formality, its object, partially, being to enable the superiors authorities to decide on a consideration of the explanation offered by the person, concerned, whether the adverse report is justified. Unfortunately, for some reason or another, not arising out of any fault on the part of the appellant, though the adverse report was communicated to him, the Government has not been able to consider his explanation and decide whether the report justified."

10. After the aforesaid observation this Court directed the State Government to consider and dispose of the representation made by the appellant and thereafter the Selection Committee was directed to consider his case afresh. In Amar Kant Choudhary v. State of Bihar, (supra) the Court again emphasized that adverse report in a confidential roll cannot be acted upon to deny promotional opportunities unless it is communicated to the person concerned so that he has an opportunity to improve his work and conduct or to explain the circumstances leading to the report. Unless the representation against the adverse entry is considered and disposed of if is not just and fair to act upon those adverse entries. These decisions lay down the principle that unless an adverse report is communicated and representation, if any, made by the employee is considered, it cannot be acted upon to deny promotion. We are of the opinion that the same consideration must apply to a case where the adverse entries are taken into account in reting an employees prematurely from service. It would be unjust and unfair and contrary to principles of natural justice to retire prematurely a Government employee on the basis of adverse entries which are either not communicated to him or if communicated representations made against those entries are not considered and disposed of. The appellant had submitted his representations against adverse entries for the year 1971-72 and 1972-73 and admittedly those representations were not considered and disposed of and yet the appropriate authority considered those entries informing opinion that the appellant's premature retirement was in the public interest. We are, therefore, of the opinion that for this reason the order of the State Government is not sustainable in law."

(Emphasis supplied)

15. In Vijay Kumar, I.A.S. v. State of Maharashtra, reported at 1988(Supp.) S.C.C. 674, then Hon'ble Apex Court has taken the same view and held that benefit of senior time scale could not have been denied to employee on account of uncommunicated adverse reports. This ruling is followed by Hon'ble Apex Court in the case between (Union of India v. E.G. Nambudiri), and in paragraph 6 again it has been laid down that principles of natural Justice require the reporting authority to communicate the adverse remarks to the Government servant. Adverse report which is not communicated to Government servant, or if he is denied the opportunity of making representation to the superior authority, cannot be considered against him. Leading judgments of Hon'ble Apex Court on the point of natural justice are considered and relied upon. Paragraphs 6 and 7 of this ruling Union of India v. E.G. Nambudiri, are important and they read thus :

"6. Entries made in the character roll and confidential record of a Government servant are confidential and those do not by themselves affect any right to the Government servant but those entries assume importance and play vital role in the matter relating to confirmation, crossing efficiency bar, promotion and retention in service. Once an adverse report is recorded, the principles of natural justice require the reporting authority to communicate the same to the Government servant to enable him to improve his work and conduct and also to explain the circumstances leading to the report. Such an opportunity is not an empty formality, its object, partially, being to enable the superior authorities to decide on a consideration of the explanation offered by the person concerned, whether the adverse report is justified. The superior authority competent to decide the representation is required to consider the explanation offered by the Government servant before taking a decision in the matter. Any adverse report which is not communicated to the Government servant, or if he is denied the opportunity of making representation to the superior authority, cannot be considered against him. See : Gurdial Singh Fiji v. State of Punjab, 1979(3) S.C.C. 518. In then circumstances it is necessary that the authority must consider the explanation offered by the Government servant and to decide the same in a fair and just manner. The question then arises whether in considering and deciding the representation against adverse report, the authorities are duty bound to record reasons, or to communicate the same to the person concerned. Ordinarily courts and Tribunals, adjudicating rights of parties, are required to act judicially and to record reasons. Where an administrative authority is required to act judicially it is also under an obligation to record reasons. But every administrative authority is not under any legal obligation to record reasons for its decision, although, it is always desirable to record reasons to avoid any suspicion. Where a statute requires an authority though acting administratively to record reasons, it is mandatory for the authority to pass speaking orders and in the absence of reasons the order would be rendered illegal. But in the absence of any statutory or administrative requirement to record reasons, the order of the administrative authority is not rendered illegal for absence of reasons. If any challenge is made to the validity of an order on the ground of it being arbitrary or mala fide, it is always open to the authority concerned to place reasons before the Court which may have persuaded it to pass the orders. Such reasons must already exist on records as it is not permissible to the authority to support the order by reasons not contained in the records. Reasons are not necessary to be communicated to the Government servant. If the statutory rules require communication of reasons, the same must be communicated but in the absence of any such provision absence of communication of reasons do not affect the validity of the order.

7. On behalf of the respondent it was contended that principles of natural justice require the superior authority to record reasons in rejecting the Government servant's representation made against the adverse remarks as the order of rejection affected the respondent's right. It is true that the old distinction between judicial act and administrative Act has withered away and the principles of natural justice are now applied even to administrative orders which involve civil consequences, as held by this Court in (State of Orissa v. Binapani Del.), . What is a civil consequence has been answered by this Court in (Mohinder Singh Gill v. Chief Election Commissioner, New Delhi), 1973(2) S.C.R. 272, Krishna Iyer, J., speaking for the Constitution Bench observed:

"But what is, a civil consequence, let us ask ourselves, by passing verbal booby-traps? "Civil Consequences" undoubtedly cover infraction of not merely property or personal rights but of civil liberties, material deprivations and non-pecuniary damages. In its comprehensive connotation, everything that affects a citizen in his civil life inflicts a civil consequences."

The purpose of the rules of natural justice is to prevent miscarriage of justice and it is no more in doubt that the principles of natural justice are applicable to administrative orders if such orders affect the right of a citizen. Arriving at the just decision is the aim of both quasi judicial as well as administrative enquiry, an unjust decision in an administrative enquiry may have more far reaching, effect than decision in a quasi judicial enquiry. Now, there is no doubt that the principles of natural justice are applicable even to administrative enquiries. See (A.K. Kraipak v. Union of India), ."

16. In (Madhukar Jayaram Deshmukh v. City & Industrial Development Corporation of Maharashtra Ltd.)12, reported at 1991(11) C.L.R. 952, the Division Bench of this Court has reiterated the same view.

17. Board however has placed strong reliance upon the judgment of Hon'ble Apex Court between Baikuntha Nath Das v. Chief District Medical Officer, Baripada, reported at , to contend that the adverse remarks need not be communicated. It is argued that case of Brij Mohan Singh and case of E.G. Nambudiri are overruled because of this judgment. Reliance has been placed on paragraph is 23 to 25 of this judgment in support. The said paragraphs explain the situation as under :

"23. We now come to the decision in Brij Mohan Singh Chopra v. State of Punjab, relied upon by the learned Counsel for the petitioner. In this case, there were no adverse entries in the confidential records of the appellant for a period of five years prior to the impugned order. Within five years, there were two adverse entries. In neither of them, however, was his integrity doubted. These adverse remarks were not communicated to him. The Bench consisting of E.S. Venkataramiah and K.N. Singh, JJ., quashed it on two grounds viz.

1. It would not be reasonable and just to consider adverse entries of remote past and to ignore good entries of recent past. If entries for a period of more than 10 years past are taken into account it would be an Act, of digging out past to get some material to make an order against, the employee.

2. In Gurudayal Singh Fijji v. State of Punjab, , Amarkant Chaudhary v. State of Bihar, , it was held that unless an adverse report is communicated and. representation, if any, made by the employee is considered it may not be acted upon to deny the promotion. The same consideration applied where the adverse entries are taken into account in retiring an employee prematurely from service, K.N. Singh, J., speaking for the Bench observed : "it would be unjust and unfair and contrary to principles of natural justice to retire prematurely a Government employee on the basis of adverse entries which are either not communicated to him or if communicated, representations made against those entries are not considered and. disposed of."

This is the first case in which the principles of natural justice were imported in the case of compulsory retirement even though it was held expressly in J.N. Sinha, that the said principles are not attracted. This view was reiterated by K.N. Singh, J., again in , (Baidyanath Mahapatra v. State of Orissa), (Bench comprising K.N. Singh and M.H. Kania, JJ.), In this case, the Review Committee took into account the entire service record of the employee including the adverse remarks relating to the years 1969 to 1982 (barring certain intervening years for which no adverse remarks were made). The employee had joined the Orissa Government service as an Assistant Engineer in 1955. In 1961 he was promoted to the post of Executive Engineer and in 1976 to the post of Superintending Engineer. In 1979 he was allowed to cross the efficiency bar with effect from 1-1-1979, He was compulsorily retired by an order dated 10-11-1983. The Bench held in the first instance that the adverse entries for the period prior to his promotion as Superintending Engineer cannot be taken into account. It was held that of the officer was promoted to a higher post, and that too a selection post, notwithstanding such adverse entries, it must be presumed that the said entries have lost their significance and cannot be revived to retire the officer compulsorily. Regarding the adverse entries for the subsequent years and in particular relating to the years 1981-82 and 1982-83 it was found that though the said adverse remarks were communicated, the period prescribed for making a representation had not expired. The Bench observed at 2221 of A.I.R. :

"... These facts make it amply clear that the appellant's representation against the aforesaid adverse remarks for the years 1981-82 and 1982-83 was pending and the same had not been considered or disposed of on the date the impugned order was issued. It is settled view that it is not permissible to prematurely retire a Government servant on the basis of adverse entries, representations against which are not considered and disposed of. See Brij Mohan Singh Chopra v. State of Punjab, ."

24. On the above basis, it was held that the Review Committee ought to have waited till the expiry of the period prescribed for making representation against the said remarks and if any representation was made it should have been considered and disposed of before they could be taken into consideration for forming the requisite opinion. In other words, it was held that it was not open to the Review Committee and the Government to rely upon the said adverse entries relating to the years 1981-82 and 1982-83, in the circumstances, unfortunately, the decision in (Union of India v. Col. J.N. Sinha), , was not brought to the notice of the learned Judge when deciding the above two cases.

25. The basis of the decisions in Brij Mohan Singh Chopra, , and Bidyanath Mahapatra, , it appears, is that while passing an order compulsory retirement, authority must act consistent with the principles of natural justice. It is said so expressly in Brij Mohan Singh Chopra. This premise, if carried to its logical end, would also mean affording an opportunity to the concerned Government servant to show cause against the action proposed and all that it involves. It is true that these decisions do not to that extent but limit their holding to only one fact of the rule viz. acting upon undisclosed material to the prejudice of a man is a violation, of the principle of natural justice. This holding is in direct conflict with the decision in J.N. Sinha, which excludes application of principles of natural justice. As pointed out above, J.N. Sinha, was decided after, and expressly refers to the decisions in Binapani Dei, and Kraipak, , and yet holds that principles of natural justice are not attracted in a case of compulsory retirement. The question is which of the two views is the correct one. While answering this question, it is necessary to keep the following factors in mind :

(a) Compulsory retirement provided by F.R. 56(j) or other corresponding rules is not a punishment. It does not involve any stigma nor any implication of misbehaviour or incapacity. Three Constitution Benches have said so vide (Shyam Lal v. State of Uttar Pradesh), , (T.G. Shivacharana v. State of Mysore), and (R.L. Butail), .

(b) F.R. 560, as also the first Proviso to Rule 71 (a) of the Orissa Service Code, empowers the Government to order compulsory retirement of a Government servant if in their "opinion", it is in the public interest so to do. This means that the action has to be taken on the subjective satisfaction of the Government, In (R.L. Butail), :

1971 Lab I.C. (N) 2, the Constitution Bench observed :

"... In Union of India v. Col. J.N. Sinha, , this Court stated that F.R. 56(j) in express terms confers on the appropriate authority an absolute right to retire a Government servant on his attaining the age of 55 years if such authority is of the opinion that it is in public interest so to do. The decision further states :

"If that authority bona fide forms that opinion, the correctness of that opinion cannot be challenged before courts. It is open to an aggrieved party to contend that the requisite opinion has not been formed or the decision is based on collateral grounds or that it is an arbitrary decision."

These paragraphs show that the Hon'ble Apex Court noted that Brij Mohan Singh's case was the first case in which principles of natural justice were imported in the case of compulsory retirement contrary to express finding recorded by it in his between Union of India v. J.N. Sinha reported at , that said principles are excluded. It further is apparent that in case of Baikuntha Nath Das, the Hon'ble Apex Court considers the requirement of compliance with principles of natural justice while ordering compulsory retirement of an employee. The fact that it does not constitute stigma/ punishment and element of public interest involved in matters of compulsory retirement appears to be the reason because such actions are to be completed immediately. Though the employee has no right to of promotion or higher grade of pay and denial thereof does not constitute punishment under the service rules, the same principle may not apply in the matter of consideration of the case of employee for promotion or for grant of next higher timescale. Further observations in paragraphs 31, 32 and paragraph 35 of the judgment again show that the Hon'ble Apex Court has found that in some cases adverse remarks of recent years may not be communicated and in some cases representations against the same may be pending. The hon'ble Apex Court has expressed that in review Committee which considers the issue of compulsory retirement by observing that said Committee consists of more than one responsible officers and it would not be swayed by one or two remarks, favourable or adverse. It further observed that such committee would form opinion on totality of consideration of entire record including representation, if any made by such Government servant against the adverse remarks. It has been held that for such purposes action of compulsory retirement cannot be held back. It is further made clear that the authority considering compulsory retirement will be conscious of the fact that these adverse remarks are not communicated or representation against the same is still pending. It is also noticed that such committees consist of very high and responsible officers and it is unlikely that adverse remarks over number of years would remain uncommunicated and still, they would be made the basis of action. It is also stated that in such situations which are not likely to occur. If action is taken it would be case of malice in law. Observations in paragraph 35 demonstrated that the Hon'ble Apex Court found that the order of compulsory retirement is not punishment and it does not cast any stigma and a such principles of natural justice are not attracted. It is thus difficult to read this ruling in favour of respondents to hold that even for denying the benefit of G.O. 74, in present matter, alleged uncommunicated adverse remarks against petitioner can be looked into by the Board.

17-A. Advocate Deshpande has also relied upon Constitutional Bench judgment of Hon'ble Apex Court in case between Prakash Chandra Sharma v. Oil & Natural Gas Commission, reported at 1970 S.L.R. (S.C.) 116. In said ruling the employee pointed out that uncommunicated adverse remarks have been used by departmental promotion committee to supersede him in the matter of promotion relevant observations of Constitutional Bench are contained in paragraph 9 :

"9. It was not disputed that the instructions as to confidential reported have not been properly observed in the case. It is not suggested that the departmental promotion Committee acted mala fide. If the adverse remarks were there in the confidential reports it was the duty of departmental promotion committee to take note of them and come to a decision on consideration of them. The committee could not be executed to make investigation about the confidential reports. It appears to us that in this case there was no discrimination purposeful or otherwise and at the best, the committees taking into consideration confidential reports with respect to which the petitioner has been given no chance to make representation was merely fortuitous. In such a State of affairs we are not satisfied that any interference is called for and the rule will therefore be discharged. There will be no order as to costs."

(Emphasis added)

18. This judgment in Prakash Chandra Sharma is delivered on 22-8-1967 and it does not consider the angle of principles of natural justice at all. In case of Brij Mohan Singh (supra) the issue has been considered in the light of principles of natural justice and considerations evolved in the mater of promotion have been extended even to premature retirement. The judgment in case of Baikuntha Nath Das v. Chief District Medical Officer, Baripada, reported at does not approve such an extension or application of principles of natural justice in the matter of compulsory retirement. However, it is to be noticed that the judgments of Hon'ble Apex Court requiring compliance with principles of natural justice in the matter of denial of promotion on the basis of uncommunicated adverse remarks are delivered after 22-8-1967. Further, no judgment of Hon'ble Apex Court taking a view to the contrary in the matter of promotion has been cited before us. It is also to be seen that case cited above, there was no debate about the existence of adverse remarks in confidential record of employee. In Baikuntha Nath Das v. Chief District Medical Officer, Baripada (supra). In paragraph 5 of the Hon'ble Apex Court has noted that adverse remarks were made by successive Civil Surgeons and not by any particular Chief District Medical Officer against whom the employee had grievance. It also noted the finding reached by High Court that material placed before High Court did not justify a conclusion that the remarks in confidential character roles had not duly and properly been recorded. In fact, in paragraph 31 the Hon'ble Apex Court has stated that it should not be understood as saying either that adverse remarks need not be communicated or that the representations, if any, submitted by Government servant against such remarks need not be considered or disposed of. It appears that when there is no such debate or when the employer is in position to demonstrate by clinching evidence that the service record of employee always carried such adverse remarks and also employer satisfactorily explains the circumstances in which those adverse remarks could not be communicated to concerned employee, and there are no allegations of mala fides or victimisation against the employer, different yardsticks may apply. However, in the present case where there are allegations of mala fides and employer is unable to prove alleged adverse remarks in the service roll of petitioner, the non-communication of alleged adverse remarks is required to be viewed with circumspection and the action of employer in denying higher grade to petitioner on the basis of alleged adverse remarks cannot be sustained.

19. The defence of respondent that petitioner was not graduate and therefore could not have been promoted as Divisional Accountant is again without any merit. For the purposes of GO 74, the qualifications can be relaxed and it is apparent that therefore only case of petitioner could be placed before Selection Committee by the respondent. The defence is therefore meaningless.

20. Under the circumstances writ petition is allowed. The impugned communication dated 16 October, 1990 is hereby quashed and set aside. The respondent Board is directed to extend benefit of GO 74 to petitioner by giving him higher pay scale of the post of Divisional Accountant from 1-6-1982 with all consequential benefits and arrears. We also find that demand of interest made by petitioner is justified and we direct respondent to pay interest at 6 percent on this amount from 15th October, 1985 as that is the date on which the petitioner has been granted exemption from passing departmental promotion examination till actual payment of entire amount to the petitioner. We are also inclined to saddle the cost of petition upon respondent Board. Thus, writ petition is allowed with costs and rule is made absolute in above terms.