Bombay High Court
S.C.Desai vs The Railway Goods Clearing & ... on 14 August, 2017
Bench: A.A. Sayed
WP 1305-2002.doc
DDR
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.1305 OF 2002
S.C. Desai
Indian inhabitant of Thane
residing at C/52, Ramchandra
Apartments, Yashodhan Nagar,
PAHADA no.II, Thane - 400 604 ...Petitioner
versus
1. The Railway Goods Clearing and
Forwarding Establishment Labour
Board for Greater Bombay and
Authority constituted under
Section 6 of the Mathadi Act, 1969
having its office at 84-A Broach
Sadan, Devji Ratansey Marg,
Danabundar, Mumbai 400 009.
2. The Chairman,
The Railway Goods Clearing
Forwarding, Labour Board for
Greater Bombay having his office
at 84A, Broach Sadan, Devji Ratansey Marg,
Danabundar, Mumbai 400 009. ...Respondents
Mr. Mahendra Agavekar i/by V.P. Vaidya, for Petitioner.
Mr. Sanjay Prabhakar Shinde, for Respondent nos.1 and 2.
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WP 1305-2002.doc
CORAM : A.A.SAYED AND
M.S.KARNIK, JJ.
RESERVED ON : 2nd August, 2017.
PRONOUNCED ON : 14th August, 2017.
JUDGMENT (PER M.S. KARNIK, J.) :-
The petitioner challenges the order of the dismissal
dated 15/4/2002 passed by the respondent-Board dismissing him
from their service. The petitioner joined the services of the
respondent-board as clerk in November, 1986. In 1994, respondent-
board alleged that on account of certain entries made in provident
fund register during the period 1989-1990 and 1990-1991 resulted in
loss to the board on account of certain discrepancies. A charge-sheet
dated 16th March, 1998 was issued to the petitioner and disciplinary
proceedings were started against him.
2. Following charges were framed against the petitioner :-
1) While preparing in all 44 Resignation matters
during the financial year 1989-90 & 1990-91, an
amount of Rs.62,955.88 in the workers Provident Fund
contribution and Rs.62,955.88 in the Boards
contribution has been increased. Thus he has caused a
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financial loss of Rs.1,26,911.76 to the Board.
2) By making incorrect entries in the Provident
Fund Account of the Board's workers and by increasing
the same amount the Board's contribution by &
obtaining signatures of Chairman & Secretary thereon,
has cheated the officers & thereby the Board.
3) Without discharging the duties responsibilities
as clerk, has violated the code of conduct of the Board.
4) Has lost the faith of the Board.
3. The petitioner disputed his involvement and pointed out
the handwriting of the disputed entires are not in his handwriting
and asked the respondent to verify the same. During the course of the
inquiry the evidence of Shri Pednekar was recorded. Learned Counsel
for the petitioner submitted that Shri Pednekar has deposed only on
the basis of the entries made in the provident fund register and he
could not have any knowledge about the relevant period as he joined
only in the year 1994 as Accountant.
4. Learned Counsel for the petitioner submitted that the
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findings recorded by the Inquiry Officer are perverse and based on no
evidence. According to him Shri Pednekar was not competent witness
to depose. Learned Counsel for the petitioner submitted that the
petitioner was assigned the duties to maintain the register of
provident fund showing the accounts of provident fund deducted and
due to the employees on their superannuation. According to him, it is
a normal practice prevailing in respondent no.1 Board that the
account of provident fund is maintained on the basis of the muster
register (Khate Pustak) maintained by some other clerk. The
petitioner on the basis of the provident fund register maintained by
the petitioner and duly verified and certified by the accountant under
whom he was working, the Mathadi workers were paid their legal
dues towards the provident fund on their superannuation. It is a
submission of the learned Counsel for the petitioner that during the
period 1989-1990 and 1991-1992, 44 workers resigned from the
respondent-board and were paid provident fund amounts due to
them.
5. Learned Counsel for the petitioner submits that there is a
delay in issuing the charge-sheet as the same has been issued after a
lapse of ten years from the alleged incident and after lapse of about
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four years from the knowledge of the incident and therefore on this
ground itself the inquiry is vitiated. It is a submission of the learned
Counsel for the petitioner that the petitioner has made entries in the
register on the basis of muster register prepared by the another clerk
and the same is verified by the accountant from time to time and also
audited by the Auditor who did not find irregularities in maintaining
the said account, the petitioner cannot be held responsible. It is also
pointed out by the petitioner that the figures entered by the
petitioner in the provident fund register are the figures given to him
by the accountant under whom the petitioner was employed and the
said figures were tallied with the figures in the muster register.
According to petitioner, it is Shri Savale and Shri Nighut who
intelligently carried out this idea of inflating the figures in all the
registers maintained by the petitioner and two others and that the
petitioner is not concerned with the alleged fraud.
6. Learned Counsel for the petitioner was at pains to point
out that Shri Pednekar who was examined during the course of
inquiry had no personal knowledge about the incident and he has
merely deposed on the basis of the documents placed on record by
him. In his submission the inquiry conducted was not fair and proper
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and in as much as he could not defend the charges as the respondent
withheld the material evidence that of disciplinary proceedings held
against Shri Savale and Shri Nighut who were found guilty. In the
submission of the learned Counsel the petitioner was working under
Shri Savale and that they should have examined Shri Savale. He
could have proved his contention that the provident fund register
maintained by him was duly verified and certified from time to time
by Shri Savale. In his submission at the highest the act of the
petitioner can be that of negligence but surely the charges proved
against him do not justify the punishment of dismissal from service.
7. Respondent-board on the other hand has filed affidavit-
in-reply. Learned Counsel for the respondent pointed out that in the
years from 1987-1988 to 1992, a large scale fraud was perpetrated
on respondent no.1-Board, by certain employees of the Board about
19 in number (including the petitioner), who misappropriated a huge
amount from the wages deposited in the Board, in collusion and
connivance with each other and with the Government appointed
Auditor. Prior to 1994, in the Kalyan branch office, wages payable to
the Mathadi workers were deposited from the 1 st of the month to 12th
day of the month, with the table clerks by the registered employers.
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About seventy-five percent of the wages were in cash. The said table
clerks maintained full accounts of the wages and levy received and
deposited the same in the Board's bank account. The table clerks also
calculated the wages payable to the Mathadi workers, and the Head
Office sent the cheque for wages to the table-clerks as per the
statements prepared by them. The Personnel Officer of the Board was
in charge of the overall supervision of the table-clerks.
8. Learned Counsel for the respondent further pointed out
that the fraud came to light when in the year 1992 the said auditor
Mr. S.D. Gunjal appointed by the Government submitted the audited
balance sheet for the year 1991-92 along with his report to the State
Government. The respondent no.1 Board however was not given a
copy of the said balance sheet by the auditor at the relevant time, and
it was only in the year 1993 that the respondent no.1 Board received
the second copy of the audited balance sheet for the year 1991-92.
On going through the balance sheet it was found that there was a
glaring discrepancy of 1,12,12,000/- in the two balance sheets for the
same year. The respondent no.1 Board therefore undertook scrutiny
of the accounts of the Board through special auditor and found large-
scale misappropriation of the funds of the Board from the year 1987-
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88 onwards. About 19 employees of the respondent no.1-Board,
(including the petitioner) were involved. These comprised of table
clerks responsible for handling cash and payment of salaries,
supervisors, accountant, assistant accountants, Inspectors, Personal
Officer (the petitioner herein) and the Chartered Accountant Mr. S.D.
Gunjal appointed by the Government to audit the accounts of the
Board. It was found that the aforesaid sum of Rs.1,12,12,000/- had
been siphoned off by these employees in collusion and connivance
with each other and in criminal conspiracy. The said employees
falsified and fabricated accounts, and in the case of cash
misappropriation, they destroyed the relevant documents and
records. The respondent no.1 Board lodged a complaint with the Anti
Corruption Bureau, and pursuant to the said complaint eight
employee including petitioner were arrested. He submits that charge-
sheets have been filed against all eighteen employees, and the cases
against the said employees are pending in Special Court, Mumbai.
9. Learned Counsel for the respondent pointed out that
during the year 1990-91 and 1991-92, the petitioner was working as
a Clerk in Provident Fund Section. As provident fund clerk, the
petitioner was in charge of Main Provident Register in which
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individual provident fund accounts of the workers was maintained. At
the end of every month, the Table Clerks in the Board prepare
payment sheets and post the amount of Provident fund deducted
from the workers monthly wages in a separate statement called the
Provident Fund Deduction Statement or Provident Fund Chart. The
table clerk then sends the said statement or provident fund chart to
the provident fund clerk. The provident fund clerk, is thereafter
required to post provident fund deductions of the worker from the
said provident fund chart in the main provident fund register. At the
end of the financial year, the concerned table clerk calculates the
total amount of provident fund deductions and posts it in the
provident fund deduction statement or provident fund chart. The
provident fund clerk is also required to draw up the total provident
fund accumulations of the provident fund and tally it with the total
provident fund accumulations shown by the table clerk in the
provident fund chart. Where a worker resigned, the provident fund
clerk was required to prepare the total provident fund amount
payable to the worker as well as the gratuity and to submit the same
to the assistant accountant. The disbursement of the said provident
fund and gratuity was done by the provident fund clerk.
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10. Learned Counsel for the respondent pointed out that the
Board in a special audit conducted in the year 1994-95 and 1995-96,
found that the petitioner had paid excess amount by way of workers
provident fund contributions and the Board's provident fund
contributions in 27 cases totaling to Rs.20,000/-. The modus
operandi adopted by the petitioner was that such amounts were
increased only in the cases of workers who resigned. It was found
that the amounts in the last financial years were changed/altered by
the petitioner to an inflated amount. The petitioner thereafter
showed the same amount as the provident fund contributions payable
by the Board. In the audit it was found that the totals worked out by
the petitioner in the Main Provident Fund Register did not tally with
the totals drawn up and posted by the table clerk in his Provident
Fund Chart. It was also found that the amounts in most cases was
paid to the workers partly by cheque and partly by cash and in some
cases entirely in cash.
11. In the submission of the learned Counsel for the
respondent-board the petitioner has admitted that during the period
1989-1990 to 1990-1991 when he was working in the provident fund
department he has prepared all 44 cases of resignations and that the
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signature thereunder were his own. In the submission of the learned
Counsel in the 44 cases involved in the charge-sheet, the amounts
shown by the petitioner in the main provident fund register did not
tally with amount shown in the provident fund deduction statement
maintained by the table clerk and that the amount shown in main
provident fund register were inflated amounts. According to him, it is
the main duty of the petitioner to tally the final figures arrived at the
end of the financial year with the final figures shown in the statement
of the table clerk. In his submission the defence of the petitioner that
the auditors of the Board did not find any discrepancy is of no
consequence, as the auditor of the Board, Shri S.D. Gunjal was
himself a party to the fraud. According to him, the inquiry is
conducted in consonance with principles of natural justice and fair
opportunity was given to the petitioner to defend the charges levelled
against him. In his submission the findings recorded by the Inquiry
Officer cannot be interfered by this Court in the exercise of writ
jurisdiction under Article 226 of the Constitution unless they are
perverse and based on no evidence.
12. We have heard learned Counsel for the parties. Learned
Counsel for the petitioner invited our attention to the findings
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recorded by the Inquiry Officer. The Inquiry Officer has taken into
consideration the evidence of witness Shri Pednekar who has deposed
that table clerk prepares payment-sheets, writes the amount of
provident fund to be deducted from the workers' monthly wages,
thereafter the clerk who distributes workers' wages who then passes
on the said statement of wages to the clerk who is responsible for
filling up provident fund deductions of the workers. In his deposition
Shri Pednekar has stated that the clerks then fills in provident fund
figures in the respective workers provident fund as above and this
work was being done by the petitioner. Shri Pednekar has deposed
that all papers connected with the resignation of the Mathadi workers
have been prepared by the petitioner and he has initialed on such
papers. Shri Pednekar has deposed that while noting down provident
fund figures from the board as well as from workers side, the
petitioner has increased the provident fund figures from both sides.
He further deposed that the petitioner has put the board into heavy
financial loss. In his deposition Shri Pednekar has stated that during
the period 1989-1990 and 1990-1991 he was not working as an
accountant but one Shri D.G.Chandane was working as an
accountant. Shri Pednekar admitted that the work of the Accountant
is to see that the provident fund deductions are done properly. He
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further deposed that Shri Chandane was placed under suspension
and did not give any information about misappropriation in the
workers provident fund accounts during the above mentioned period.
13. It has come in his deposition that in the year 1992-1993
the Railway Labour Board came to know that there were certain
irregularities in the boards financial transactions and as such the
board appointed special auditor to check the accounts and he came to
the conclusion that the petitioner had ahand in such irregularities. He
deposed that on account of substantial increase in the provident fund
accounts in respect of such resigned workers the board had to suffer
financially.
14. The petitioner during his examination agreed that in the
Annexure annexed to the charge-sheet there is increase of Rs.1000/-
or Rs.2000/- in respect of the provident fund that was paid to the 44
Mathadi workers who had resigned during the period of 1989-1990
and 1990-1991. The petitioner also agreed that in all 44 resignation
cases he had put his own signature. He however did not agree that he
was responsible for showing increase in the provident fund amount in
respect of the Mathadi workers who had resigned.
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15. The Inquiry Officer while holding the charges levelled
against the petitioner as proved took into consideration the
deposition of Shri Pednekar that while noting provident figures from
board side as well as from the workers side, the petitioner has
increased the provident fund figures from both sides. The Inquiry
Officer took into consideration the fact that this was not disputed
either by the Defence Counsel or the petitioner. We do not find the
approach of the Inquiry Officer unreasonable or perverse. The
findings are based on the documentary evidence and the oral
evidence of Shri Pednekar. The Inquiry Officer has also taken into
consideration the statement given by the petitioner during course of
the inquiry. The petitioner was given opportunity to cross-examine
Shri Pednekar. The inquiry is conducted in accordance with the
principles of natural justice and every possible opportunity has been
given to the petitioner to defend the charges levelled against him. As
the findings of the Inquiry Officer are based on the evidence on
record it is not possible for us to re-appreciate the evidence on record
and arrived at our own findings.
16. Learned Counsel for the petitioner relied upon the
decision of the Apex Court in the case of Moni Shankar v. Union of
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India & anr. (2008) 3 SCC 484 to contend that the evidence
adduced during the course of the inquiry will have to be taken into
consideration if the requisite standard of proof (preponderance of
probability) is met and that this Court has power to interfere where
the test of proportionality is not satisfied.
17. The learned Counsel for the Respondents relied upon the
decision of the Apex Court in the case of Food Corporation of India
& Anr. Vs. V.P. Bhatia (1998) 9 SCC 131 to support his contention
that there is no delay in issuing the charge-sheet. According to us in
the facts of the present case we do not feel that the Enquiry is vitiated
on the ground of delay.
18. Learned Counsel for the Respondents also relied on the
decision of the Apex Court in the case of Chief Executive Officer,
Krishna District Cooperative Central Bank Limited & Anr. Vs. K.
Hanumantha Rao & Anr. (2017)2 SCC 528 to contend that the
decision qua nature and quantum of punishment is prerogative of
disciplinary authority and courts while exercising power of judicial
review do not sit as appellate authority. The Apex Court has observed
thus:
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"7.1. The observation of the High Court that accusation of lack of proper
supervision holds good against the top administration as well is without any
basis. The High Court did not appreciate that Respondent 1 was the
Supervisor and it was his specific duty, in that capacity, to check the
accounts, etc. and supervise the work of subordinates. Respondent 1, in fact,
admitted this fact. Also, there is an admission to the effect that his proper
supervision would have prevented the persons named from defrauding the
Bank. The High Court failed to appreciate that the duties of the Supervisor
are not identical and similar to that of the top management of the Bank. No
such duty by top management of the Bank is spelled out to show that it was
similar to the duty of Respondent 1.
7.2. Even otherwise, the aforesaid reason could not be a valid reason for
interfering with the punishment imposed. It is trite that courts, while
exercising their power of judicial review over such matters, do not sit as the
appellate authority. Decision qua the nature and quantum is the prerogative
of the disciplinary authority. It is not the function of the High Court to
decide the same. It is only in exceptional circumstances, where it is found
that the punishment/penalty awarded by the disciplinary authority /
employer is wholly dis-proportionate, that too to an extent that it shakes the
conscience of the court, that the court steps in and interferes".
19. There is thus no merit in the present Petition and the
same is dismissed with no order as to costs.
20. Rule to stand discharged.
(M.S.KARNIK, J.) (A.A.SAYED, J.)
