Delhi High Court
Union Of India And Others vs Lt. Gen. M.S. Sandhu, Pvsm (Retd.) on 24 April, 2001
Author: M A Khan
Bench: D Bhandari, M A Khan
ORDER
Mahmood Ali Khan, J.
1. The learned Single Judge of this court has allowed CWP No. 983\1970 filed by the respondent and has quashed the orders of the appellant dated 28.9.1977, 03.02.1978 and 03.05.1978 and has directed the release of pension, with-held by the appellant, to the release of pension, with-held by the appellant, to the respondent along with interest @12% per annum within three months. The appellant is aggrieved and has filed this appeal.
2. The facts which are relevant for the purpose of deciding this appeal are as follows. Respondent Mr. M.S. Sandhu was a Lt. General in Indian Army. He retired on attaining the age of superannuation on 31.5.1995. He was granted pension and other retrial benefits as per Rules after the competent authority had granted certificate of satisfactory service in his favor.During the relevant year of 1971-1972 he was working as Director of Ordnance Services. The Directorate of Ordnance Services (DOS), inter alia, lays down general policy regarding estimation, provision, programme, receipt, accounting, storage, care and preservation and issue of all ordnance stores, ammunition and vehicles etc. It has other duties and responsibilities as well with which we are not concerned in this case. The Comptroller and Auditor General (CAG) submitted its report for the year 1972-73 relating to the Department of Supply. Certain adverse observations were made therein with regards to the transactions relating to the purchase of blankets for the armed forces by the Department of Supply.The report was laid before the Parliament and the Parliament appointed Public Accounts Committee (PAC) (1974-75) consisting of its members. After examining the report of the CAG and the relevant records, the PAC submitted its 137th report to the Parliament on 24.2.1975. The PAC made certain adverse observations with regard to the transactions of purchase of blankets for defense services and recommended that the role of various officers in particular, MR. Sandhu, Director, Ordnance Services, should be probed either by Central Vigilance Commission (CVC) or the Judicial Commission presiding over by a sitting High Court Judge. The matter was according entrusted for enquiry to the CVC. The CVC submitted a report dated 3.12.1975 in which some of the imputations of mis-conduct and irregularities in the purchase of blankets by DOS during the tenure of the respondent were found established. Thereafter PAC submitted to the Parliament its 198th report of CVC etc on 09.3.1976.
3. Based on the report of the PAC an Under Secretary of Ministry of defense of the Government of Indian acting on behalf of the President of India issued a show-cause notice on 11.6.1976 to the respondent asking him to show cause as to why certificate of satisfactory service issued be not cancelled and a cut of 50% on his pension be not imposed from the date of his retirement.The Ministry of defense rejected the reply dated 24.8.1976 to show-cause notice submitted by the respondent and by letter dated 28.9.977 the service of the respondent was declared unsatisfactory and a cut of 50% was imposed from 01.6.1975, the date from which the pension was granted.The respondent preferred an appeal on 9.11.1977 against the order which, a Joint Secretary of the Ministry, after giving personal hearing to the respondent, dismissed by letter dated 03.5.1978. (We will advert to the show cause notice, its reply and the order passed thereon in detail at appropriate statue later on). The respondent felt aggrieved and filed the civil writ petition in July, 1978 challenging the order of 50% cut in the pension amount imposed by the appellant.
4. The appellant did not file any reply/counter affidavit to the writ petition but advanced oral arguments opposing it.
5.
The learned Single Judge looked the report of the PAC which was the basis is the show-cause notice, the Pension Regulations No. 3 & 5 and also the memorandum dated 4.7.1975 issued by the Government for exercising the powders under Pension Regulation 5 and held that before an order of reduction of pension by 50% was passed it was necessary that the officer was found guilty of grave mis-conduct and that the said mis-conduct must be established in a departmental or a judicial proceeding.Since there had been no regular departmental enquiry or judicial proceeding to establish the guilt of the respondent the impugned orders dated 28.9.1977, 03.02.1978 & 03.5.1978 which reduced the pension of the respondent by 50%, were not sustainable, accordingly quashed. The learned Single Judge directed the payment of arrears of pension with-held within 3 months with interest @15% per annum and the costs.
6.
The learned counsel for the appellant contended that the respondent was entitled to the grant of pension on his rendering satisfactory service and by virtue of Regulation 3 of Pension Regulations for the Army, 1961 (Part-I) (hereinafter to be referred to as Pension Regulations), the appellant had the powder to reduce the amount of the pension as deemed proper after cancellation of the certificate of satisfactory service which was earlier granted. It was stated that in pursuance to the report of CAG, the PAC examined the matter and submitted its report to the Parliament on 9.3.1976, barely 3 months before the retirement of the respondent from service. The CVC held enquiry and submitted its reports at a much later date in December, 1975. It was stated that both the PAC and CVC have found incriminating material to implicate the respondent in the commission of an offence of grave mis-conduct and the irregularities in the purchase of blankets for the army during the year 1971-72. It was stated that the case for grant of pension was processed much in advance and the certificate of satisfactory service was granted to enable the pension sanctioning authorities to process the case for grant of pension on time since by that time there was nothing against the appellant before the sanctioning authority. The respondent, as such, started drawing the pension from 01.6.1975 but as soon as the report of the PAC and the CVC was received, the appellant invoked powders vested in it by Regulation 3 and cancelled the certificate of satisfactory service and also reduced the pension by half after due service of a show-cause notice and consideration of the reply of the respondent received against it. Not only this, it was submitted that the respondent was also given an opportunity of personal hearing by Joint Secretary of the Ministry of defense when he filed an appeal.
7.
It has been emphatically argued by the learned counsel for the appellant before us that the certificate of satisfactory service which was a condition precedent to the grant of full pension to an army personnel in terms of Regulation 3 of the Pension Regulation has been cancelled by the appellant after serving a show-cause and giving an opportunity of hearing to the respondent in his defense, therefore, the appellant had power to impose and cut on the pension, of the respondent as it deemed fit.It was submitted that no disciplinary action and trial by a Court Martial could be initiated before the retirement of the respondent from service on attaining age of superannuation on 31.5.1975 and also within 6 months from the date of his retirement as provided by section 123 of Army Act as it was applicable at that time(the section has since been amended and the period stipulated for taking disciplinary action against the army personnel from the date of his retirement is extended from 6 months to 3 years). As such, disciplinary action for gross mis-conduct committed by the respondent during the tenure of his service could not be initiated. It was contended that no judicial enquiry in respect of the mis-conduct could be started against the respondent either.For this reason, it was urged, the appellant had full power under the Pension Regulations 3 and in the alternative Regulation 5 to reduce the pension of the respondent. It was stated that in accordance with the memorandum dated 4.7.1975, clause (ii) the respondent was guilty of grave mis-conduct.Therefore, by giving an opportunity of hearing to him in defense by serving a show-cause notice and considering the reply received it was permissible for the appellant to reduce the pension.
8.
The learned counsel for the respondent, conversely, submitted that the powers for withholding, suspending or forfeiting the pension are given by Rule 5 of the Pension Regulations and the power could be exercised only be following the principles of natural justice and by giving reasonable opportunity of hearing to the respondent in his defense which opportunity has been denied and the rule audi alteram partem had been violated .The respondent was not joined in the enquiry conducted by the PAC and the CVC and the imputations of the charge of mis-conduct had not been established against the respondent in a disciplinary or judicial enquiry.Therefore, the powder vested by Pension Regulations cannot be invoked to deny pension to the respondent.
9. Learned counsel for the respondent has further submitted that the matter was also investigated by the CBI and no incriminating evidence was found against the respondent and he had been exonerated.He further stated that in reply to the show-cause notice served by the appellant, the respondent had submitted a reply disputing facts and pleading certain facts which required to be proved by evidence. Therefore, the appellant has no power to reduce his pension without first establishing the misconduct in a fair and impartial enquiry where he has been given opportunity to produce evidence and materials in support of his defense. It is contended that the impugned order has been passed without giving reasonable opportunity of hearing of his defense against the show-cause notice.Therefore, the impugned order of reduction of his pension is illegal and not sustainable in law.It has also been pointed by him that despite repeated directions of this court, the appellant has failed to produce the CBI investigation report.He also contended that the show-cause notice was issued, in all probability by a Joint Secretary of the Ministry of defense and his reply was also rejected by him before passing the impugned order. He further stated that he had preferred appeal to the President and the appeal was also heard by Joint Secretary of the Ministry of defense and his appeal has met the same fate. According to him it is even worse than the case of an from Ceasor's order Ceasor's wife since here the appeal was heard by a Joint Secretary of the appellant against an order passed by a Joint Secretary of the same department. He submitted that the respondent has always offered to participate in the administrative / disciplinary / judicial impartial /fair enquiry to be conducted by the appellant and he is even now willing to subject himself to such enquiry.
10. The pension is granted to the army personnel under Pension Regulations. The Regulations which provide for the grant of pension can also provide for taking it away on justifiable grounds[see Major (Retd.) Haricchand Pawa Vs. UOI & others . Similar view was taken by the Apex court in
UOI & others Vs. Subedar Ram Narain & others where it was held that even if the Regulations are not statutory, the same are still binding because the pensionary benefits are payable only under these Regulations and, therefore, the same can be forfeited in the manner and the circumstances as provided for by the said Regulations. The view taken by the Supreme Court in Major (Retd.) Harichand Pawa(supra) was reaffirmed in UOI & others Vs. Brig. P.K. Dutta (Retd.) (1995) supplementary (2) SCC 29. As such, even if the Pension Regulations are not statutory by character they have binding force as the pensionary benefits are regulated by it. The pension which is granted in terms of these Regulations can also be with-held, reduced or forfeited as provided for in the Rules. In fact, the respondent does not dispute the right of the appellant under the Pension Regulations to pass orders of withholding, forfeiting or reducing the pension even after the pension has been granted to a person on his retirement from service.
11. Regulation 122 of the Pension Regulations provides for computation of the service which qualifies for the grant of pension. Regulation 25, on the other hand, prescribed the minimum period of qualifying service required for grant of pension. The Hon'ble Supreme Court in
UOI & others Vs. Lt.Col. P.S. Bhargava has observed that there were 3 provisions which specifically provided for situations where full amount of pensionary benefit need not be given and those Regulations were Regulations No.3, 4 & 16. Regulations 3, 4 & 16 are as under:-
"REGULATION 3: FULL RATE OF PENSION OR
GRATUITY NOT INVARIABLY
ADMISSIBLE
The full rate of pension or gratuity provided for in these Regulations shall not be granted unless the service rendered has been satisfactory. If the service has not been satisfactory, the competent authority may make such reduction in the amount of pension as it thinks proper.
"REGULATION 4: GRANT OF PENSION IS SUBJECT
TO FUTURE GOOD CONDUCT.
Future good conduct shall be an implied condition of every grant of a pension or allowance.
REGULATION 16: OFFICERS CASHIERED,
DISMISSED REMOVED OR CALLED
UPON TO RETIRE.
(a) When an officer who has to his credit the minimum period of qualifying service required to earn a pension, is cashiered or dismissed or removed from the service, his/her pension, may, at the discretion of the President, be either forfeited or be granted at a rate not exceeding that for which he/she would have otherwise qualified, has he/she retired on the same date.
(b) When an officer who has to his/her credit the minimum period of qualifying service required to earn a pension is called upon to retire or to resign or in the event of his/her refusing to do so is retired from or gazetted out of the service, he/she may at the discretion of the President be granted a pension at a rate not exceeding that for which he/she would have otherwise qualified, had he/she retired on the same date in the normal manner.
12. We notice another Regulation, Regulation No. 5 which empowers the competent authority to pass orders of withholding, suspension or discontinuation, of the pension in special circumstances. It is reproduced as under:-
"REGULATION 5: PENSION MAY BE WITHHELD
SUSPENDED OR DISCONTINUED
OR PAID TO WIFE OR OTHER
DEPENDENT.
In special circumstances to be determined by the President or as may be specified in these Regulations, the Pension, (service/disability or family), children's allowance or gratuity to be granted or granted to an individual, or any portion of it may be withheld, suspend or discontinued. In exceptional cases, payment or part or whole of the pension, allowance or gratuity withheld or suspended may by order of the President be made to the wife or other dependent(s) of the Pensioner."
13. The Govt. of India has issued a memorandum dated 4.7.1975 which specified the special circumstances in which powers can be invoked under Regulation 5. It is extracted below:-
"No. 21(2)/74D(Pension/Services)
Government of India/Bharat Sarkar/
Ministery of defense/Raksha Mantralaya,
(Department of defense/Raksha Vibhag)
New Delhi, the 4th July, 1975.
To,
The Chief of the Army Staff
The Chief of the Naval Staff
The Chief of the Air Staff.
Subject : Withholding/suspension or discontinuance of pension
Sir,
I am directed to refer to the Regulation 5, Pension Regulations for the Army and Air Force, Par I (1961) and Regulation 8 of navy (Pension) Regulation, 1964 and to state that the President is pleased to decide that the aforesaid regulations may be invoked under the following Special circumstances:
(i) Offence against the State as listed in Chapter VI of the Indian Penal Code, as amended from time to time (see Appendix VII in which the relevant provisions of the IPC are reproduced);
(ii) Other serious crime under I.P.C. official Secrets Act or any other Special Law of the land; and Grave misconduct;
(iii) To recover the whole or part of any pecuniary loss caused to the Government in cases where in any Departmental or judicial proceedings, the pension/individual is found guilty of misconduct or negligence committed during the period of the service including service rendered on re-employment after retirement/discharge, leading to the said loss;
.....
2. Before effecting withholding, suspension or discontinuance of the whole or part of pension, children's allowance and gratuity (including death-cum-retirement Gratuity), the competent authority shall serve upon the pensioner/individual a show case notice specifying the actions proposed to be taken against him/her, and the ground on which it is proposed to be taken and calling upon him/her to submit within 30 days of the receipt of the notice (or such further time not exceeding 30 days as may be allowed by the competent authority such representations as he/she may wish to make against the proposal; and take the representation, if any, received during the prescribed period into consideration.
3. Having taken the action indicated above, the competent authority would decide and issue orders in writing to withhold or suspend or discontinue the whole pension, children's allowance and gratuity or part thereof indicating whether the orders in case of pension and children's allowance will apply permanently or only for a specified period. An appeal against the decision of the-competent authority can be made to the Appellate Authority."
14. It is evident from Regulation No. 4 that the condition for grant of pension is that the conduct of the person should be good.
15. A feeble argument was advanced by the learned counsel of the appellant that Regulation 3 is the combination of two distinct and separate provision, one providing for the grant of full pension on the rendition of the satisfactory service and the other giving power to the competent authority to reduce the pension if the service is not satisfactory. The argument is not tenable. Both the sentences comprised in this Regulation have to be read in conjunction. Full pension is earned by a person on his giving satisfactory service and if it is not satisfactory, the authority competent to grant pension may reduce it. The Regulation does not put any limit to the extent to which the pension can be reduced. it can be reduced to zero. The competent authority mentioned in this Rule is the Ministry of defense as prescribed in the Pension Regulations.
16. A reading of Regulation 5 shows that it is meant to be used in special circumstances. First part of the regulation gives power to the competent authority to withhold, suspend or discontinue the pension. Special circumstances are to be determined by the President or by the Pension Regulations. The President has determined the special circumstances in memorandum dated 4.7.1975 referred above. (Subsequently, the Regulation 5 was amended and the special circumstances have been incorporated in it.) The second part of this Regulation, however, empowers the President to grant, suspended or withheld pension in exceptional circumstances to the wife and other dependents of the pensioner who otherwise would not be entitled to it during his lifetime. These powers are exercised by the President under exceptional circumstances only. Regulation 16, however, is applicable to only commissioned officers of the army who have been dismissed, removed or cashiered from service in a court martial proceeding but are otherwise eligible for grant pension. The power is again vested in the President to forfeit or reduce the pension of a pension who has been punished with the dismissal or removal from service or cashiered in a court martial proceedings.
17. Both the parties are ad idem that under the Pension Regulations the appellant can reduce the pension of a pensioner even after his retirement from service. According to the appellant this can be done under Pension Regulation 3 and in the alternative under Regulation 5. Conversely the respondent urges that only Regulation 5 can be invoked for this purpose. Any-how action can be taken in Regulation 3 or 5 or both the parties agree that pension can be reduced by giving reasonable opportunity of hearing to the affected person in accordance with rule of audi alteram partem. They differ materially on the scope and extent of the opportunity of hearing which is to be granted before exercising power under Regulation 3 and 5.
18. It is pertinent to note here that the learned Single Judge had agreed with the view of the respondent and held that the power of a cut in the pension could be exercised only after the misconduct on the part of the respondent in the purchase of blankets as DOS proved in a disciplinary or a judicial enquiry.
19. Before embarking upon the adjudication of the question as to whether the view taken by the learned Single Judge was sustainable in law or not it is necessary to note a little more facts about the imputations against the respondent which appeared in the report of the PAC, CVC and also the administrative orders of the appellant impugned in this appeal. it is pertinent that the appellant, despite availing of opportunity, failed to place on the record of the case the copy of the report of the CBI which had also gone into the matter. We have no hesitation in assuming that the CBI had not found any incriminating evidence or material against the respondent to implicate his in the commission of the offence of misconduct. In fact the report of the PAC as well as the CVC showed, at least, that the CBI in its investigation report has found certain officers, other than the respondent, guilty of accepting sub-standard blankets and had recommended action against them. It has not recommended any action against the respondent. Certain disciplinary and other actions were taken against the delinquent officials named by the CBI in its report.
20. Anyhow, the imputations of misconduct against the respondent are that he exhibited lack of devotion to duty and lack of integrity in relation to the purchase of blanket, in brief, as follows:
1. Gave an impression of continuing criticality of requirement beyond January 1972 even though the situation has improved;
2. On the above wrong impression of critical position beyond January 1972 caused further orders to be placed for shoddy wool blankets;
3. Conveyed distorted and misleading position regarding the relaxation granted by the DWE to enable all shoddy blankets with no virgin wool at all to be acceptable (whereas relaxation actually granted was only limited to reducing the wool content from 80% minimum to 75% minimum;
4. Was over solicitous in recommending and pleading for M/s Shree Krishna Woollen Mills, Bombay;
5. Persuaded the DWE to agree to place orders for shoddy blankets of relaxed specifications (ration distorted) even though M/s Shree Krishna Woollen Mills had offered to supply blankets of approved/normal specification;
21. Let us now examined the report of PAC dated 24.2.1975, relevant extract of which are given as under:
1.72. M.G.O. Branch (Directorate of Ordnance Service) defense Department placed an indent on D.G.S. & D for supply of 6 lakh blankets by 30th September, 1972 and another 6 lakhs by 30th September, 1973. The blankets were of three prescribed specifications viz.
(a) 100 per cent indigenous wool of medium quality.
(b) 90 per cent indigenous wool of coarse quality admixed with 10 per cent viscose rayon or nylon.
(c) 45 per cent indigenous wool of medium quality and 45 per cent shoddy wool admixed with minimum 10 per cent nylon (total wool content not to be less than 80 per cent).
1.73. This is a rigid precondition put forward although the supply timings had no relation whatsoever with stipulation. As the blankets wee required at short notice the defense Department agreed to relax the specifications. According to relaxed specifications, (i) the blankets could be made with imported shoddy wool; (ii) the wool content was not to be less than 70 per cent; and (iii) the breaking strength could be less by 10 per cent.
1.74. A sense of urgency was created and the reason advanced by the defense Department for such a course of action was that the supply of blankets by the DGS & D was not keeping pace with the requirements of the defense Department.
1.75. According to the information furnished to the Committee, the normal annual requirement of the blankets by the defense Department is approximately 7 lakhs and the specifications are also rigid. It has been stated that the defense Department makes advance planning and places its indents on the DGS & D. The DGS & D places Acceptance of Tenders on registered suppliers for supplies within the dates indicated in the acceptance notes and the dates are also extended in relaxation in consultation with the indentor. Inspection of goods supplies against the Acceptance of Tenders is the responsibility of the N.G.O. Branch of defense Department and the procedure followed by the defense Inspectorates for the inspection of goods supplied by the trade against the A/Ts placed by the DGS & D is as per DGI's Standing Orders. It has also been stated that certain departures on points of detail from the general inspection drill are made on the merits of each case.
1.76. The Secretary of the Department of Supply has stated during evidence that it is not the function of the DGS & D to scrutinise the demand that is placed on them. There was a pressing demand for the supply of blankets on the DGS & D who taking into consideration the emergency situation, sought the good offices of the Textile Commissioner and, as a result, of a meeting held in the office of the Textile Commissioner with the industry on 4th November, 1971 arranged for the supply of blankets according to relaxed specifications.
1.77. The Committee are constrained to note that in spite of the fact that the annual requirements of the defense Department for supply of blankets were known to the DGS & D they had not made any firm arrangements either for locating new source of supply of the right quality or for watching the deliveries against A/Ts placed on traditional suppliers. In several cases deliveries had to be extended or contracts had to be cancelled. When an emergent indent was received from the defense Department for supply of 4 lakh blankets, the DGS & D without taking any steps to expedite supplies against the pending contracts, acquiesced in the proposal of the Textile Commissioner that 4 lakh blankets could be obtained from the shoddy industry with relaxed standards. It is very surprising that the DOS defense Department should have readily agreed to this proposal on the false plea of emergency although there was in fact no emergency at all. When asked to state what was meant by emergency demand, the representative of the defense Department has informed the Committee in evidence that "There were about 12 lakh blankets already outstanding of supply between 1969 and 1971. These were not being supplied according to schedule which had been arrived at on the contractual basis worked out by DGS & D. We were left with no other option but to place an additional demand for 6 lakhs for delivery during 1972-73, though previous demand was existing there, because we do forward provisioning." He further informed the Committee that "this indent was not an emergency purchase. This was only an indent placed fro 1972-73 in the routine fashion. All that has happened was that we had advanced the schedule of delivery. We had asked for it a little earlier." The Committee are not at all convinced with the submission of these arguments.
1.78. The Committee are inclined to think that there must have been a sustained pressure from the shoddy industry on the DGS & D and the defense Department for acceptance of blankets made of shoddy wool because at that time considerable quantities of woollen garments had been imported by the industry as rags which could be utilised for the manufacture of shoddy blankets. The so-called critical supply position, which has been played up by the defense Department, may well have been a facade behind which questionable deals for the supply of blankets were conducted. The Committee consider that had the Ministry of defense and DGS & D asked the traditional suppliers to expedite delivery against the pending orders and unfulfilled contracts, instead of putting an emergency order, considerable financial loss to the Government would have been avoided and the quality of blankets required for the users in forward areas would not have been so much compromised. The Committee feel that use of the expression "blankets of 75 per cent shoddy wool (minimum)" in the contracts was weighted in favor of the industry because in place of 75 per cent pure wool, 75 per cent shoddy wool (minimum) became permissable. The Ministry of defense has stated that blankets made wholly from shoddy wool contain less than 100 per cent wool. As such, in the blankets containing 75 per cent shoddy wool (minimum) the actual wool contents would have been less than 75 per cent. It may be clarified why the specification was made "75 per cent shoddy wool (minimum)" instead of shoddy blankets of "75 per cent wool (minimum)".
1.79 On the 3rd November, 1971 the Deputy Director General (N) (DGS & D) wrote to the defense Department that blanket manufacturers can meet the additional defense requirements of 4 lakh numbers subject to certain relaxations. On the same day, the Ltd. Genl. Sandhu the DOS, Army Headquarters, writes to Secretary in the Ministry of Supply, that description and the specifications of the blankets as mentioned in D.D.G. (N) (DGS & D) D.O. letter of 3rd November, 1971 are broadly acceptable to the Army Headquarters. On the 23rd November, 1971, DDOS(P), Army Headquarters, makes a request to D.D.G. (N), DSG & D "kindly place orders on these two firms (M/s Krishna Woollen Mills, Bombay and M/s Swadeshi Woollen Mills Ludhiana) and forward copies of the same to this office by hand for further action."
1.80. Shree Krishna Woollen Mills whose name was recommended by the defense Department, received an order for supply of 13000 blankets which were stated to be lying ready in stock with them. The samples submitted by this firm were examined and discussed in the room by M.G.O. on 18th November 1971, and it was decided to procure these blankets on the basis of the two samples. In pursuance of the recommendation of the defense Department that DGS & D should place order on Shree Krishna Woollen Mills, bombay negotiation were conducted with the firm on 26th November, 1971 and an order was placed with them with the approval of Associated Fiance, for delivery of 13000 blankets by 10th December, 1971. Earlier on 9th November, 1971 a contract was placed with Shree Krishna Woollen Mills for supply of 50,000 blankets to the relaxed specifications pursuant to the discussions held with the shoddy industry that blankets with deviations should be accepted. The delivery of 50,000 blankets was to be made by 31st December, 1971. The firm could supply only 37,000 blankets by the due date. The quantity on order with Shree Krishna Woollen Mills was increased on 1st January, 1972 from 50,000 to 1,00,000 and this was stated to be done "with a view to ensure supply by 31st January, 1972 of 4 lakh blankets wanted by defense Services by November-December, 1971, out of 12 lakh blankets indented for in October, 1971."
1.81. One of the Associates of Shree Krishna Woollen Mills viz. Arther Import and Export Co., was given an order for 62,500 blankets out of the total quantity of 19 lakhs indented for earlier. This firm had supplied 34,200 blankets against the order of 62,500 and the balance of 28,300 blankets was cancelled. The Committee strongly suspect that after Arther Import and Export Co., had failed in the contractual obligations, their own associate Shree Krishna Woollen Mills came forward through another door to supply blankets which eventually turned out to be of very much sub-standard quality. It may be mentioned that two of the Directors of Arthur Import and Export Co. (Shree S. N. Puri and Shri R.N. Khanna) are also Directors of Shree Krishna Woollen Mills (P) Ltd., Bombay.
1.82. The Committee have no doubt-and this has been confirmed by the findings of the CBI in regard to contracts placed on this firm that there has been a concerted move on the party of Shree Krishna Woollen Mills in collusion with certain corrupt officials of the M.G.O. DOS Branch, defense Department to blackmail the Government and take much undue benefits. It is significant that when one firm failed in their contractual obligations, an associate of the same firm (common ownership) comes through another door, blackmails the Government and extracts a much higher price.
1.83. On the 25th February, 1972, the DOS, Army H.Qrs in his letter addressed to Secretary, Ministery of Supply writes:
"Recently on 11th February, 1972, a meeting was held by the DGS & D in Bombay with the representatives of the shoddy mills associations on the question of procurement of blankets. The shoddy mills association could at best offer 5 lakh blankets per year of reduced specifications, i.e. blankets having 75 per cent wool content against 80 per cent wool content. Shree Krishna Woollen Mills have offered to produce 50,000 blankets per month with 80 per cent wool content provided they are immediately booked and given long term orders.
In the light of the above and past experience of the rate of supplies it is necessary that all these mills who offer to concentrate on manufacture of blankets for defense especially of normal specification should be fully booked as early as possible. This is all the more important as price of wool is rising and any delay will result in extra expenditure. You might like to look into the case of Shree Krishna Woollen Mills in the above context.
1.84. Again on the 3rd April, 1972, DOS (Lt. Gen.) Sandhu), Army Headquarters sends a letter to DGS & D stating that:-
"The total requirement of blankets in 1972-93 subject to clearance by Ministry of finance (defense) will be 8.91 lakh (new indent) plus 9.07 lakh against outstanding contracts, i.e. 17.98 lakhs. Against this and taking into account the availability of blankets with us we would require 12 lakhs out of 17.98 lakhs by September, 1972. Our assessment is that the old suppliers will not be able to deliver more than 6 to 6.5 lakh blankets by September, 1972. New supplier who can supply A, B and C grade of blankets should, therefore, be tapped. Any deficiency which cannot be met by specification blanket should be covered by shoddy blankets of 75 per cent wool content and normal breaking strength."
1.85. He even goes to the extent of putting in, in that letter a recommendation for Shree Krishna Woollen Mills saying that:-
"You must have received the capacity report of Shree Krishna Woollen Mills and also negotiated with them and other suppliers. I shall be grateful if an indication of the outcome of the negotiation specially with regard to the prospects meeting the requirement of 12 lakh blankets by September, 1972 can be given."
1.86. Instead of inviting fresh tenders for specification blankets, the DGS & D placed orders, between April 1972 and October 1972, on three firms for 5.26 lakh
blankets of relaxed specifications. The relaxed specification of 4.46 lakhs of these blankets was to conform to type 'C' in every respect except wool contents would be 75 per cent wool (minimum). It has been pointed out by Audit that purchase of blankets of relaxed specifications cost Rs.13.42 lakhs more as compared with the price for specification blankets (having 45 per cent indigenous wool of medium quality and 45 per cent shoddy wool admixed with 10 per cent nylon-total wool content being not less than 80 per cent). The specification prescribed in the contracts had no meaning because no scientific tests of wool contracts of blankets supplied were applied in any case.
1.87. One of the firms receiving the order of 3,86,000 blankets is the same firm, viz. Shree Krishna Woollen Mills whose name was recommended by D.O.S., Army Headquarters (Lt. Genl. Sandhu).
1.88. The Committee are not at all convinced by the argument advanced by the Ministry that orders for 5.26 lakh blankets at Rs.45.02 per blanket was placed because the capacities of the other supplying firms were full. Beside paying higher prices for the blankets of relaxed specifications the Department very willingly compromised the quality of blankets as it has been categorical stated by the representative of the Department of defense that 75 per cent wool, if it is shoddy, does make it inferior to quality 'A' and 'B'. The Committee consider that there was a serious lapse on the part of the Department of Supply in not calling for fresh tenders for this item when for specification blankets, tenders were called and particularly, when a higher rate was going to be paid for shoddy blankets. The Committee are of the view that it is a clear case of collusion and require responsibility to be fixed for exemplary punishment under advice to the Committee.
1.89. It is noteworthy that Shree Krishna Woollen Mills did not attend the meeting held on 10th April 1972 where besides the representatives of 8 shoddy units the President of the Indian Shoddy Mills Association was present.
1.90. Shree Krishna Woollen Mills had also given a representation addressed to the Minister on 5th April, 1972 saying that they could supply blankets with 75 per cent wool content otherwise conforming in every respect to defense specification at the rate of Rs.41 per blanket, offering delivery at the rate of 50 to 60 thousand numbers per month. This representation is stated to have been discussed in the room of the Minister of Supply on 7th April, 1972. Orders for additional quantities of blankets were thereafter placed on Shree Krishna Woollen Mills.
Though not filed initially but at the fag end of the case the appellant has also placed a portion of the CVC report dated 3.12.1975. It is a long report. The CVC considered the following issues which arose from the report of the PAC :-
(a) Was the supply position of blankets really critical? Was the plea of emergency false or real?
(b) What relaxations in specifications were made and on whose authority these relaxations were agreed to? Did the M.G.O. branch communicated to the DGS&D the relaxed specifications directly in accordance with what was acceptable to the General Staff?
(c) Who was responsible for the use of the expression "Blankets of 75% shoddy wool (minimum)" in the contracts?
(d) Was there sustained pressure from the shoddy industry in general and from Shree Krishna Woollen Mills in particular, for the acceptance of blankets made of shoddy wool?
(e) Was thee collusion by the D.O.S. with regard to the contracts placed on Shree Krishna Woollen Mills?
(f) What lapses/irregularities, if any, were committed by the DGS&D in connection with the contracts placed with Shree Krishna Woollen Mills?
On issue (a), its conclusions were :-
(1) There was urgency for supply of blankets to the troops during the winter of 1971-72. This is established by the fact that the stooks in hand were very low and the dues out considerable. This also necessitated the adoption of certain special measures like suspension of condemnation of blankets, banning the disposal of salvaged blankets by auction and retrieving blankets from salvage and washing them. As many as 82,300 blankets were retrieved from salvage. A decision was also taken to procure 50,000 rezais and some blankets were also obtained from the Director General, Border Roads. Various steps were also taken to speed up the delivery of blankets on order according to the approved specifications.
(2) Subsequent to the winter of 1971-72, the position seems to have improved. This is established from the satisfactory reports about stock position received from the Ordnance Deports and the decision to lift the ban on condemnation of blankets.
(3) It is not clear on what basis the requirement of blankets before the onset of the winter in 1972 was estimated at 21 lakhs. Probably, this figure was arrived at by taking into account the indent for 12 lakhs issued on 29.12.71 and also the annual provisional review then under process, which ultimately resulted in the placement of an indent on 14.4.72 for 6 lakhs blankets. The indent for 12 lakhs blankets issued on 29.12.71 provided for supply of 6 lakhs blankets by 30.9.73, i.e. for the winter of 1973. At no stage was this requirement advanced. Yet, the indent for 6 lakhs issued on 14.4.72 asked for the delivery to be completed by November, 1972. The requirements for the winter of 1973 could very well have been met by the traditional suppliers, who, admittedly, accordingly to both D.O.S. and the DGS&D, were capable of supplying about 1.25 lakhs blankets per month.
(4) It would thus appear that after the winter of 1972, there was no emergency which could justify procurement of shoddy blankets of relaxed specifications. Even for the earlier period, i.e. for the winter of 1971-72, although the supply position was somewhat critical, it is difficult to justify the plea that it was so desperate as to necessitate procurement of blankets made of exclusively imported shoddy wool and with other relaxations in specifications.
On issue (b), its finding was :-
The relaxations communicated by the M.G.O. Branch to DGS&D were not in accordance with what was acceptable to the General Staff. The only relaxation agreed to by the General Staff was that the existing Type 'C' blankets could be accepted with 75% instead of 80% wool content. They had also clearly indicated that 100% pure shoddy blankets with no virgin wool should not be accepted at all. What was communicated by the M.G.O. Branch to the DGS&D, however, was that blankets made of shoddy wool having 75% wool content and of normal breaking strength were acceptable. This meant that blankets made entirely of shoddy wool with not' even an ounce of virgin wool could be accepted, provided they had 75% wool content. These relaxations were communicated to the DGS&D by the D.O.S. on his own authority without taking the approval of either the General Staff or the Ministry of defense.
On issue (c) the CVC observed 'the responsibility for this bungling seems to be entirely that of Shri P. Nath, DDG & Shri S.K. Malik, DDG.'
On issue (d) its conclusions was as under :-
(a) Almost all important decisions taken by the DOS and the DGS&D and the resultant action taken were as a direct result of representations received from Shree Krishna Woollen Mills. A few representations were also made by the shoddy industry as a whole, but sustained pressure was applied mainly by Shree Krishna Woollen Mills.
(b) The introduction of Type 'C' blankets for the firs time in 1970 seem to have been the direct result of the request made by Shree Krishna Woollen Mills.
(c) Although the acceptance of blankets with relaxed specifications was agreed to in November, 1971 to tide over temporary difficulty and it was made clear that these relaxations should apply for deliveries up to 15.1.72, the delivery date was extended to 31.1.72 on a representation made by Shree Krishna Woollen Mills.
(d) The offer dated 21.12.71 from Shree Krishna Woollen Mills was for blankets as per approved specification 'C'. Although this offer was recommended strongly the DOS to the DGS&D as well as to the Secretary, Department of Supply, on the ground that a permanent source of supply of blankets of normal specifications could be established, the reference to the D.W.E was to agree to procurement of blankets with relaxed specifications on a permanent basis. In spite of the D.W.F. not agreeing to the recommendation of the D.O.S., the ultimate order placed on Shree Krishna Woollen Mills was for the relaxed specifications.
(e) From the various nothings and correspondence in the relevant files of both the D.O.S. and the Department of Supply, it is clear that Shree Krishna Woollen Mills were quite influential and had access right up to the top. On letters addressed by them - some of them directly even to the Minister or the Secretary, immediate action was taken and almost in every case, whatever they asked for was given. Their contactman, Shri Bindra, was frequently meeting senior officers of the Supply Department. He could even ring up the DGS&D at his residence at 1.30 P.M. All these go to show that most of the decisions taken by them in the D.O.S. as well as in the DGS&D with regard to this deal were as a result of sustained pressure from this firm. It cannot be said that there was a sustained pressure from the shoddy industry as a whole for acceptance of blankets made of shoddy wool.
As regards issue (e), the Commission made following observation :-
From the circumstances mentioned above, it appears to be fairly clear that in all his actions, Lt.Gen.Sandhu was prompted by more concern for getting large orders placed with the firm Shree Krishna Woollen Mills, than for protecting defense personnel against exposure to climatic hazards. There could have been some justification for this if, eventually, the firm had risen to the occasion and supplied blankets of approved quality in time. The subsequent dismal performance of the firm and the consequential loss to Government as well as the grave risk to the security of the country resulting from exposing our troops to climatic hazards and thereby jeopardising their fighting efficiency, have made the lapses committed by Lt.Gen.Sandhu more serious.
From the above discussion, the conclusion drawn is that Lt.Gen.Sandhu was certainly personally interested in getting contracts placed with Shree Krishna Woollen Mills.
The CVC made its report as under :-
To sum up, the following lapses/irregularities have been committed by the organisation of the DGS&D :-
(a) Using the expression "Blankets with 75% shoddy wool (minimum)" in the A/T agreements,
(b) Going out of their way to concede every request - reasonable or unreasonable - made by the firm,
(c) Giving free access and allowing several concessions to Shri Bindra, the contactman of the firm.
(d) Ignoring complaints received about defective blankets supplied by this firm and still continuing to extend patronage to them.
Like Lt.Gen.Sandhu in the D.O.S., Shri P.Nath in the DGS&D definitely seems to have been personally interested in giving contracts to this firm.
Regarding estimated loss sustained by the Government as well as the contract placed on M/s Shree Krishna Woollen Mills, it was noted that the 4 contracts of the value of Rs.2,11,22,250.00 were placed on this mill. Another contract for supply of blankets of the value of Rs.1.09 lacs was placed by the DGS&D on this firm but it was cancelled On 22.9.175 and it was decided to go in for risk purchase. About 40,000 blankets supplied by this firm were recommended fro price reduction ranging from 5 to 50% as they were found to be defective and about 1500 were completely rejected. In another case about 2900 blankets were totally rejected and this firm accepted deduction of 12.5% in respect of about 11,500 blankets and agreed to replace about 2400 blankets which were found unfit and were rejected but there was no price reduction or no reduction in respect of another order. The CVC estimated a sum of Rs.3,65,301.28 as recoverable from the above said firm against A/T NO.664 and that a demand notice was issued but the firm had obtained stay order from the High Court. The other demand notices have not been issued. Lastly, it was observed that there seems to be considerable strength in the PAC's conclusion that the various officials who dealt with these contracts were either colluding with or were duped by an unscrupulous firm and thereby, seriously jeopardised the efficiency of our troops and also caused heavy financial loss to the Government. (Emphasis ours)
Now we turn to the show-cause notice issued in the name of the President under the signature of an Under Secretary of the Ministry of defense of the appellant. The notice dated 11.6.1976 is as under :-
"No.4(2)/76/D (Pension/Services) Government of India/Bharat Sarkar Ministry of defense/Raksha Mantralaya, New Delhi, the 11th June, 1976.
MEMORANDUM
Whereas, you, while functioning as Director of Ordnance Services in the Directorate of Ordnance Services were involved in the case concerning supply of sub-standard blankets to the defense Services by M/s Shree Krishna Woollen Mills.
2. And whereas, the Public Accounts Committee in their 137th Report (5th Lok Sabha) have examined the said transactions and have found that you have committed irregularities in this deal which resulted in substantial loss to the Government apart from seriously jeopardising the fighting efficiency of our troops by exposing them to climatic hazards.
3. And whereas, it has been found that in almost every major step taken with regard to the placement of orders with the above-named firm the initiative had come from you in your capacity as DOS.
4. And whereas you had supported the request of Shree Krishna Woollen Mills in 1970 to introduce for the first time type 'C' blankets as one of the acceptable qualities.
5. And whereas at your instance confirmation was sent to DGS&D that blankets made of shoddy wool having 75% wool content, and of normal breaking strength were acceptable thereby ignoring the views of DWE and R&D which were communicated to you more than once by DWE as under :-
a) All shoddy wool blankets were not likely to be as warm, durable and serviceable as type 'C' blankets of the approved specifications (17 Feb. 72) R&D.
b) A number of relaxation had already been granted to meet emergent needs and it was time to ensure that standards were maintained and supplies confirmed to the approved specifications.
c) 100% pure shoddy blankets with no virgin wool should not be considered acceptable. Existing type 'C' blankets with the wool content reduced from 80% to 75% were acceptable provided they were up to the specification requirements in respect of strength and other construction particulars.
d) Procurement of blankets with shoddy wool should not be made a permanent measure.
These relaxations were communicated to the DGS&D on your own authority without taking the approval of either the General Staff or the Ministry of defense.
6. And whereas you strongly recommended the representation of Shree Krishna Woollen Mills for extension of delivery date from 15.1.72 to 31.1.72 even though it was made absolutely clear that the above relaxation was a purely temporary step to tide over the crises during the winter of 1971-72 and was to be applied only for deliveries up 15.1.72.
7. And whereas you were an active parts for making out a false case that 21 lakh blankets would be required before the onset of the said estimate requirements of the winter of 1973 amounting to 6 lakhs of blankets which could have been supplied according to standards specifications by the approved suppliers.
8. And whereas you strongly recommended to the DGS&D as well Secretary, Department of Supply, the acceptance of Shree Krishna Woollen Mills' offer to supply blankets of normal specifications on a regular basis.
9. And whereas your recommendation mentioned at (8) above was based on the plea that Shri Krishna Woollen Mills had offered to supply blankets of normal specifications, though you had simultaneously persuaded the DWE to agree to the procurement of blankets with relaxed specifications.
10. And whereas although the DWE did not agree to your recommendation, the MGO Branch, at your instances, adviced the DGS&D that relaxed specifications were acceptable.
11. And whereas the above facts reveal that in all your actions you were prompted by greater concern for getting large orders placed with the firm than for protecting defense personnel against exposure to climatic hazards.
12. And whereas you were personally interested in getting the orders placed with Shree Krishna Woollen Mills in spite of the fact that the firm's performance was not good and this caused to the Government an estimated loss of Rs.4.81 lakhs excluding the loss caused by relaxed specifications mentioned in the supply orders which were not approved, as well as seriously affected the fighting efficiency of our troops by exposing them to climatic hazards.
And whereas, upon the consideration of the above facts the President of India has come to the conclusion that a serious prima facie reflection is cast on your conduct and for that reason the President of India proposes:
i) to cancel the Satisfactory Service Certificate issued to you;
ii) to impose a cut of 50% on your retiring pension (Rs.1100/-p.m.) from the date of your retirement.
Now, therefore, you are hereby called upon to show-cause as to why the action as proposed above should not be taken against you. If no cause be shown to the contrary within 30 days from the date of receipt of this Memorandum, it will be assumed that you have no cause to show to the contrary and the final decision will be taken ex-parte."
The respondents's reply dated 24.8.1976 to this notice is spread over 69 typed pages. He has repudiated the allegations contained in the show cause notice, gave facts which were not taken into consideration, disputed facts as stated and in the end sought a judicial inquiry into the whole matter. But a few paragraphs of this reply may be noted to appreciate his defense. They are as under:
"5. For a proper appreciation of the facts of the case it is necessary to explain the respective roles and powers of various officers and agencies involved in the purchase of blankets i.e. from calculation of requirements to the materialisation of supplies.
(a) DOS Calculation of requirements and projection of demands after Ministry of Finance (defense) concurrence to DGS&D indicating Delivery period. To expedite for supplies, when there is delay as he is the ultimate accountable authority to the Army.
(b) DGI to lay down specifications in their capacity as "Authority holding sealed particulars" (AHSP), to allow relaxation in consultation with General Staff and DOS if necessary and carry out inspection for purposes of acceptance of Stores from firms.
(c) DGS&D To call for Tenders/Quotations and place firm supply orders after negotiation on all aspects including price.
6. It is also necessary to bring out the Organisation of Ordnance Directorate in brief to appreciate the chain of correspondence as far as General Stores are concerned.
Dos Lt. Gen M S SANDHU
1 Jun 71 to 31 May 75
Dy DOS Maj Gen A.K. BISWAS
1 Jun 71 to 10 May 74
DDOS (P) COL R R SURI
3 May 70 to 13 Nov 71
" Col P N REKHI
14 Nov 71 to 22 June 72
" Col S NEELAKANTAN
26 Jun 72 to 27 Jun 74
ADOS(P) Lt Col C MASLAMANI
31 May 71 to Feb 74.
7. Any indent or correspondence concerning blankets emanated from ADOS (F) or DDOS (P) and was routed through DDOS(P) to Dy DOS and then to DOS. In the chain of correspondence every one initialed on minute sheet and then it was put up to DOS for signatures. Therefore it must be clearly understood that correspondence emanating in the name of DOS was not really initiated by DOS and was in fact put up from the section concerned, and all others through the chain perused the letters and initialed the minute sheet for its correctness and only then it was put up to DOS to keep the level of correspondence and to add weight to the expediting action.
9. DGS&D placed following contracts on M/s Shri Krishna Woollen Mills:-
AT NO. & date Qty Ordered Basic Rate Delivery Type
(a) 571 dt. 50,000* Rs.37.00 31.12.71 Shoddy Blankets
8 Nov. 71 *This figure was increased to to relaxed
1 lakh by DGS&D vide AT No. 664 specifications
dt 1 Jan 72 with delivery for i.e. 70% wool
original quantity as 15.1.72 contents
and for additional qty as
31.1.72
(b) 691 dt. 13,000 Rs.36.00 10.12.71 As per sample
27.11.71 or earlier
(c) 794 dt. 3,86,000 Rs.40.50 1.5.72 to Shoddy
21.4.72 31.12.72 blankets with
75% shoddy
@ 50,000 to wool contents
60,000 per minimum
month.
12. After getting the sanction of Raksha Mantri and MCO in Oct 71, the Indent for 12 lakhs blankets was placed on 29 Oct 71 with a delivery schedule of 6 lakhs by 30 Sep 72 and balance 6 lakhs by 30 Sep 73. The specifications for those blankets were as per defense Specification type A, B and C which are briefly as under:
Type A - 100% indigenous wool of medium
quality
Type B - 90% indigenous wool of course
quality admixed with 10% viscose
rayon or nylon.
Type C - 45% indigenous wool of medium
quality and 45% shoddy Wool
admired with 10% nylon - total
Wool. Total wool contents not to
be less than 80 per cent.
13. After the refugee influx from East Bengal in Mar 71 and later Development with Pakistan, it was clear that conflict with Pakistan was inevitable. Even the visit of our Prime Minister to other countries, to solve the human problems of refugees which had come to India had no result. The Heads of Services including DOS were taken into confidence by the then Chief of Army Staff and were told to be ready by Oct 71, for a possible war.
20. The dues out position which was 7 lakhs in Feb 71 rose to 10 lakhs in Nov 71 even though 5.20 lakhs of blankets had been supplied by Trade/DGS&D from Feb 71 to Oct 71.
21. The supply situation was critical and Army Commanders/Corps Commanders were complaining the non supply of blankets to COAS and Ordinance Directorate was asked to give the position as prevailing in Oct 71. COAS was apprised that:
(a) Our demand outstanding on DGS&D up to Mar 72 were for 16.20 lakhs blankets approximately.
(b) We have been asking DGS&D for giving 3 lakhs blankets per month from Aug 71 onwards. DGS&D had agreed to give 2 lakhs per month. As against this only, 1 lakhs blankets per month were materialising.
(c) The chances of DGS&D improving his performance are not bright, we are continuously bringing pressure, there has been some improvement.
22. COAS was further informed that pressure on blankets has increased greatly as more troops were living under canvas under field conditions and in addition, reservists were being recalled and first reinforcement may be approved shortly.
26. At the meeting on 22 Oct 71 in the Office of Additional Secretary, the proposal of MGO Branch for manufacture of issue to static formations was approved. This step helped in saving 1 lakh blankets for forward areas (1 Razai equal to 2 blankets for the purpose of scale of B 1 issue). DGS&D promised to submit a report by 30 Oct 71. On 29 Oct. 71 in the meeting held in the office of Secretary Supply (Shri K. Ram). The critical supply of blankets was reviewed. At this meeting it was intimated by Ministry of defense that they wanted supply of 4 lakhs blankets on super-emergent basis by Nov. 71 (Dues out them in Oct 71 were 9.35 lakh approximately). DGS&D had already covered 19.5 lakhs blankets by then on a large number of small units whose capacity had been fully booked and supplies against their contract were flowing satisfactorily. It was forecast by DGS&D that about 1.5 lakhs blankets would be supplied during Nov. this leaving a short-fall of 2 to 2.5 lakhs blankets required be defense Services. This supply of 1.5 lakhs in Nov was possible because a decision had been taken to reimburse increase in the budgetary levies to those firms.
30. up to the end of Oct the correspondence on this subject had been handled by Maj Gen AK BISWAS Dy. DOS but after the direction of COAS during Oct 71, I then took up with DGS&D vide DO No.86800/C/KC/OS-PII dated 1 Nov 71 and urged on him for urgent action in the matter of decision taken in the meeting held in the office of Secretary Supply on 29 Oct 71. It was also intimated to DGS&D that in view of urgency collection of blankets will be done by the Army Directly Ex-factories at Panipat, Amritsar, Ludhiana and Mirzapur. This was done to avoid delay in materialisation of Stores. The DGS&D was requested to give his personal attention to this matter and requested to let the Ordnance Directorate know his estimate of blankets that could be made available by 30 Nov 71. He was particularly requested to take immediate action for the procurement of 50,000 Razais from Trade so as to ensure that deliveries commence by 15 Nov 71 and are completed by 30 Nov 71.
32. In this meeting the Secretary Supply referred to the discussion in his Office on 29 Oct when the position of blankets barrack was reviewed and it was felt that the supply of 1.25 lakhs nos. could be expected against the contract already placed by DGS&D. As regards the balance qty required by the end of Nov 71, it was decided that DDG (N) who was going to Bombay would explore the possibility of procuring as large number of barrack blankets as possible from the large mills with the assistance of Textile Commissioner. If the Barrack Blankets were not available, he could explore the possibility of procuring supplies of Non Standard Type of Blankets which may conform in dimension, size and weight etc. to the defense Specifications as much as possible. Shri NATH reported that he had a meeting with the blankets manufacturing units in the large scale sector in the room of Deputy Textile Commissioner (Shri DIKSHIT) and the mills had indicated that while it will not be possible for them to supply barrack blankets conforming to defense specifications, it would be possible to make supplies of substantial quantities of blankets manufactured out of the admixture of wool and shoddy. Shri NATH said that a sample would be obtained from each manufacturing unit and blankets would be tested and inspected according to the sample submitted by the mills. After some discussion it was decided that the following Board of Officers should be constituted for effecting the purchase of Non Standard Type Blankets, against the emergent defense requirements.
(i) DDG (N) -Convenor
(ii) Rep of Textile Commissioner
(iii) Rep of DI (GS)
(iv) A rep of DOS
(v) DG (IF)
(vi) DS Textile
34. Shri P NATH DDG(N) intimated to Col P.N. Rekhi DDOS (P) on 3 Nov 71 vide his DO No. TRWL-5/Blankets/DOS that pursuant to the discussion held in Bombay on 30 Oct 71, blankets manufactures have informed the Textile Commissioner (Shri D N DIKSHIT) that can meet the additional defense requirements of 4 lakhs blankets during the month of Nov and Dec 71 subject to the following conditions and relaxations:
(a) Decision must be communicated to them within 3 days i.e. by 5 Nov. 71
(b) Specification of blankets barrack should be relaxed so as to provide wool contents up to 70% in lieu of 80%.
(C)Breaking strength should be reduced by 10%.
(d) Bulk supply would be in plain dark grey shade with normal shade variation.
35. DDG (N) Shri P NATH stated that in all other terms and conditions the specifications for Barrack Blankets will be adhered to with normal tolerance. He further stated that blankets would be manufactured entirely of shoddy and 70% wool contents will be assured. The rest will comprise of Viscose, Rayon, Nylon, synthetic fibre excluding cotton specifically.
36. The reply of the DO Shri P NATH DDG (N) addressed to Col P N REKHI DDOS (P) Army Head Quarters was sent under my signature on same day (3 Nov) to Secretary Supply (Shri K RAM). In this DO I mentioned that as per decision taken in the meeting held in the Office of Shri K RAM Secretary Supply on 29 Oct 71, Shri P NATH DDG (N) has offered procurement of 4 lakhs blankets from Mills in Bombay during Nov and Dec 71. Copy of the DO letter of Shri P NATH laying the condition and asking relaxation was also sent to Shri K RAM Along with my DO.
37. I was also aware of the meeting held in the Office of Shri K RAM on 1 Nov 71 which was attended by Brig. BHUPINDER SINGH DI (GS) and Col P N REKHI DDOS (P) where the question of procurement of blankets had been discussed and Shri P NATH DDG (N) had said that the blankets of defense. Specification could not be procured but the industry was prepared to supply admixture of wool and shoddy blankets i.e. Non Standard Blankets.
39. In this DO OS Directorate mentioned that Description and specification mentioned in the DO of Shri P NATH dated 3 Nov are broadly acceptable, we also felt that it will not be advisable to bind ourselves to these specification in advance as there are bound to be variation in wool contents and breaking strength when deliveries are actually made. It was therefore suggested that the matter be left to be constituted by the DGS&D for this purpose in which representative of DOS and DI (CS) were to serve as members. This board will seal suitable samples offered by the firm and the inspector concerned will accept the blankets against the sealed samples.
41. On 4 Nov 71 a meeting of blankets manufacturers available in Bombay was held in the Office of Textile Commissioner Bombay with Shri R C SAXENA Joint Textile Commissioner in the Chair to meet the super emergent requirements of 4 lakhs blankets. The following were present:
Official
1. Shri P Nath Dy. DGS&D New Delhi
2. Shri C B Gulati Financial Advisor, DGS&D
New Delhi
3. Shri D. N. Dikshit Director Textile
Commissioner's Office
Bombay
4. Col P N REKHI Rep DOS New Delhi
5. Lt Col THAKUR Rep DOS New Delhi
6. Lt Col Sodhi Rep IOS Bombay
7. Shri Rao Rep IOS Bombay
Industries Representatives
1. Shri SHIVA PRAKASH SETH - Chairman
Indian Shoddy Mills
Association Bombay
2. Other Mills Representatives.
42. At this meeting, it was impressed on industry that they must ensure that 4 lakhs blankets confirming to specification are supplied before 31 Dec 71. OUT OF THIS 1-1/2 lakhs blankets have to be supplied in any case before Nov 71. The representative of the Industry mentioned that barring one of them they had not been in the line of manufacture of blankets barrack, hence most of them would have to start the required production denovo and they would have to realign their equipment for such production. Therefore it was not possible for them to make required supplies by Dec end, or in any case what was required by Nov 71. They further said that during the short period of time at their disposal, it was impossible for them to arrange purchase of indigenous wool, hence there is no alternative but to supply blankets out of imported shoddy raw material which was presently available with them but the same should be replenished, so that they could fulfill their other sale obligations after the supplies to defense have been completed. They also mentioned that while importing this raw material they were not aware about the defense requirements and hence they had imported the same in various shades and colours. They mentioned that because of the above it would not be possible for them to specifically adhere to the specified colours. They also mentioned that as the imported shoddy rags contain Non-woollen fibres as well, hence it would not be possible for them to supply blankets with 80% wool contents as specified. They also mentioned that many of them do not have looms of adequate width of 60". It was therefore urged by the representative of the industry that with the existing raw material and tools available with them, they can meet the defense requirements provided the following deviations from the existing specifications are granted:
(i) That the blankets will be made with imported shoddy wool.
(ii) That the total wool contents in the finished blankets shall not be less than 70%
(iii) That the shade of the blankets will be variation of mixed colour such as mixed grey, mixed air force, mixed brown and mixed blue.
(iv) Breaking strength will be less by 10% than specified.
(v) That the size of the blanket will be 90" in length and 60" in width. Such Mills who do not have the required type of looms would be supplying the blankets in the size 90" x 54".
(vi) However in case of shorter blanket a proportionate deduction of prices in Co-relation with the weight would be allowed.
(vii) In addition to other concessions the normal deviation as allowed according to the specification will be given.
43. The Mills agreed to supply the blankets as under:
S.NO. Name of Mill Size of Supply
blanket In Nov 71 In Dec 71
==========================================================================
1. M/s Amrit sar Swedeshi 15,000 4000 16000
Woolen Mills Amritsar 90"x 60"
5,000
90" x 54"
2. M/s Fani Wooltex 90" x 54"
Corporation, Bombay - 20000
3. M/s KAY KAY Woollen 90" x 54" - 10000
Mills Thana Bombay
4. M/s MADHU Wool Spg 90" x 60" - 10000
Bombay
5. M/s Model Woollen Mills
Bombay 90" x 60" - 50000
6. M/s Shri Krishna
Woollen Mills Bombay 90" x 60" - 50000
7. M/s Simplex Woolen
Mills Bombay 90" x 60" 15000 55000
8. M/s ENDEE Woollen & 90" x 60" - 10000
Silk Mills Faridabad
9. M/s Himalaya Woollen
Mills Bombay 90" x 54" - 20000
10. M/s KUSUM Wool and
Woollen Mills Calcutta 90" x 54" - 2000
11. M/s Mehra Spg Mills 90" x 60" - 45000
Amritsar
12. M/s OSWAL Spg & Wvg
Mills Ludiana 90" x 60" 5000 10000
13. M/s Shri BHARAT Woollen 90" x 60" - 25000
Mills, Amritsar
14. M/s HIMACHAL Woollen 90" x 60" - 45000
Mills Paonta (HP)
15. M/s Arun Spg. Mills
Amritsar 90" x 54" 5000 15000
======================
29000 3,78,000
======================
16. M/s Model Woollen
Mills Amritsar 1000 Quality confirm.
44. In addition to Mills agreeing to supply the above quality blankets as per relaxed specification listed above, the mills listed below offered to supply ready blankets and in the same conference held at BOMBAY on 4 Nov 71 in the Office of the Textile Commissioner Bombay, it was decided that the defense Inspection should examine them and wherever they found them the blankets are suitable to their requirements the same could be purchased at a price to be mutually settled between the supplier and DGS&D.
LIST OF MILLS WITH READY STOCK OF SHODDY BLANKETS IN PLAIN AND CHECK WITH OR WITHOUT FRINGES IN SIZE FROM 90" X 54" TO 90" X 60"
S. No. Name of Mills No. of blankets Ready
in stock
==========================================================================
1. M/s Shri Krishna Woollen Mills
Bombay 13,000 Immediately
2. M/s. Simplex Woollen Mills Bombay 5,000 "
3. M/s Amritsar Swadeshi Woollen Mills, Amritsar 3,000 "
4. M/s Pearl Woollen Mills Ludhiana 15,000 "
5. M/s OSWAL Spg & Wvg Mills Ludhiana 5,000 "
6. M/s Mehra Spg Mills Amritsar 10,000 "
7 M/s Arun Spg Mills Amritsar 5,000 "
8. M/s ENDEE Woollen & Silk Mills Faridabad 1,700 "
9. M/s Model Wop;;em & Sild Mills Amritsar 5,000 "
10. M/s Bharat Woollen Mills Amritsar 5,000 "
11. M/s Himalaya Woollen Mills Amritsar 5,000 "
12. M/s KUSUM Wool and Woollen Mills Calcutta 2,000 "
-----------
69,700
-----------
46.Since meeting held in the office of Secretary Supply, Shri K.RAM on I Nov 71 had been attended by Brig BHUPINDER SINGH Director Inspection (General Stores) where the question of lowering the specification of blankets barrack had been raised and also the meeting of 4 Nov 71 had been attended by the representative of IGS Bombay Lt Col SODHI where decision of lowering the specification of blankets barrack had ben taken, in view of the industries inability of supply blankets as per defense specification, Brig BHUPINDER SINGH DI (GS) wrote to General Staff (DWN) on 9 Nov 71 vide Note 5 on part case to main file 2117/14/ TD-44, listing all the relaxations asked by the industry in the conference of 4 Nov 71 at Bombay Along with the comments, proposed to DWE the relaxation asked by the industry in view of extreme urgency of blankets and asked for his necessary approval. DWE accorded his approval vide Note 7 on the same file on 16 Nov 71 "in view of the condition obtaining at present, I agree as a special case, that the proposed relaxation may be granted and 4 lakhs Sub Standard Blankets may be procured. Efforts should, however continue to procure Blankets to approved specification." The file wards routed through DOS. DI(GS) and DWE had already agreed informally that relaxation will be given, it was because of that, that the proposal of Shri P NATH DDG(N) sent to DOS on 3 Nov 71 was broadly accepted and yet as a precaution formation of Board of Officers was proposed, which was later on given the duty of procuring Trade Pattern Blankets as per samples.
47. The recommendation made by DI (GS) for relaxation Along with his remarks were as under :
Relaxation asked Remarks
(i) That the blankets will be (i) Our specification cater
made with imported shoddy for manufacture of blankets
wool. with 45% shoddy wool
admixed with 45%
indigenous wool and 10%
Nylon
(ii) That the total wool contents (ii) Our specification
in the finishing blankets calls for 80% wool min.
shall not be less than 70%
(iii) That the shade of Blankets (iii) Specification
will be variation of mixed stipulates natural
colour, such as grey shade
mixed grey, mixed air force,
mixed brown and mixed blue
(iv) Breaking strength would (iv) 10% deficiency in
less 10% than specified breaking strength is
already being
permitted
(v) That the size of the blankets (v) Specified size of
will be 90" in length and 60" blankets is 90"x 60', 2"
in width. Such Mills who do tolerance in width is
not have the required type of already being
loom, would be supplying the permitted
blankets in the size 90" x 54"
in which case proportionate
deduction would be made.
49. AT No. 571 of 8 Nov 71 was placed by DGS&D for 50,000 blankets at Rs.37/- per blanket with delivery period as 31.12.71. The figure on this AT was increased by DGS&D vide Admt letter dated I Jan 72 with DP for original qty as 15.1.72 and for additional 50,000 quantity on 31.1.72.
50. The extension has been given by DGS&D with reference to the letter of the firm dt.22.12.71. There was also a Telex in late December from the firm Shri. Krishna Woollen mills addressed for attention of COL P N RAKHI DDOS (P) in which they had stated that against the AT for qty 50,000 blankets, qty 29,000 blankets had been dispatched, another 3,000 were to be dispatched next day they expected to complete 40,000 out of 50,000 by 31 Dec 71. (Actually 37,000 were supplied by 31 Dec 10,000 were under inspection). The firm was hopeful of completing the balance supply of 50,000 before 31 Dec 71, but due to shortage of water supply could not do so.
53. Since the supply of specification blankets was not possible the DGS&D placed further order not only on Shri Krishna Woollen Mills but also on the following firms. (77200 Qty was defaulted by firms and cancelled out of order already placed and 1,87,500 were required against a fresh indent for prisoners of War.)
i) Simplex
ii) Dani Wooltex
iii) Amritsar Swadeshi
iv) C Raman
v) Model Woollen
vi) Kanshi Ram Amar Nath
vii) Oswal Spg and Wvg Mills
viii) Bharat Woollen
ix) Oswal Spinning
65. As has been mentioned earlier that there were chances of War with Pakistan, the War was actually declared by Pakistan on all fronts on 3 Dec 71. India declared Emergency on 4 Dec 71. With the fall of East Pakistan on 17 Dec, the switching over of the troops from eastern Theatre of Western Theatre was ordered. A complete Corps was shifted to Western Theatre (Punjab) and Air defense Brigade and other units to some other Areas in Western Theatre.
66. The units in Eastern Sector were needing only one extra blanket, but with their shifting to Western Sector 2 to 3 extra blankets were required. The shortage was further enhanced later with arrival of POW's which ultimately swelled to about 90,000. They also had to be given their essential clothing, including blankets as per Geneva Conventions. There fore ,there was further depletion of the meagre stock of blankets with DOS inspite of quickened inflow of blankets of relaxed specifications. to cope with the demand of POW, DGS&D was requested on 8 Dec 71 t o procure 75000 blankets for prisoner's of war on operational basis and adjust the quantity against the indent dated 29.10.71. The delivery of this was requested by end December . Since these were the requirement for POW, therefore, the specification originally agreed was accepted, as the Traditional Blankets suppliers were fully booked and were supplying according to their capacity, another demand with the concurrence of Finance (defense) was raised for quantity, 1,87,500 on 7.1.72 for the use of POW's to be delivered by 31.1.72. It was clarified that 75000 blankets already demanded were part of this indent, therefore, DGS&D were asked to procure 1,12,500 (187500 to 75000) blankets. This indent was placed as per standard defense Specification for blankets IND/TC/1408(g) for Type A,B and C Blankets. It was remarked that defense Specification would be followed, but if stores were not readily available, specification could be lowered. DGS&D was able to procure qty 1,69,215 to the relaxed specifications as agreed to in the meeting held in the office of Textile Commissioner on 4.11.71. The balance quantity 18285 was covered as per firm's sample approved by DI (GS) DOS Representatives.
67. Even though cease fire took place on 17 Dec.71. The troops had to stay in the forward Area. Only some formations were pulled back slightly, but were still under canvas under field conditions and were only able to move peace areas after the Simla Agreement on 3.7.1972, but that too in a phased program. The prisoners started going back on 1 Dec 72 and last batch with Ltd Gen A.K.NIAZI left India on 30.4.74. It can be well imagined as to how unpredictable was the situation in Jan 1972. It was not at all certain, as to when the troops will come to peace areas and when Prisoners of War will be repatriated. The condemnation of blankets banned in July 71 was to be restarted as the ban could not carry on indefinitely. With this background in view a DO was written the DGS&D on 14 Jan 72 ( DO No. 86800/C/KC/CS-PII) referring to earlier even No. DO of 23 Dec 71 when a letter received from Ms. Shri Krishna Woollen Mills had been forwarded in original to DGS&D. As per the records of Ordnance Directorate, this firm had supplied 13000 in Dec 71 against an AT No.691 placed in Nov 71.Against an AT No. 571 of 8 Nov 1971 for 50,000 qty 43,000 blankets had been delivered. It was stressed on DGS&D as in the past, that it is important to place demands on firms who have proved themselves reliable and have the capacity to meet defense requirements, especially during an Emergency. It was in this context and keeping in view their past performance that Shri Krishna Woollen Mills was also recommended as one such firm along with others. It was suggested to DGS&D to place order son such firms on a long terms basis. So that such firms capacity is fully booked for meeting defense requirements to the advantage of defense. DGS&D was also requested to take action to cancel orders on firms whose performance had not been satisfactory. A list of such firms was sent to DGS&D along with the DO No.86800/C/KS/OS/P-II dated 14 Jan 72. From the experience gained in past, it was mentioned to DGS&D that Jan to Mar is normally a slack period for production for civil requirements after this period most of the firms generally switch over their production to meet market demands. It was in this context that DGS&D was suggested to take immediately action to conclude contracts on firms who are willing to execute defense orders on permanent basis so as to ensure uninterrupted production throughout the year to avoid facing stalemates in supply in the next year as well.
71. Keeping in view the Telegram dated 24 Jan 72 from shoddy industry Association, a letter was written to DWE (General Staff) on 29 Jan 72 (Letter No. 86800/C/KC/OS.PII) recommending introduction of shoddy blankets with 75% wool content. This was followed up by another even No. letter on 23 Feb 72 to DWE giving an assessment of the requirement of blankets. It was estimated that to meet the requirement of troops and also to cater for reserves at the various echelons approximately 21 lakhs blankets will be required before the onset of winter. With the greatest pressure executed during 1971 the peak rate of supply from the Traditional blankets industry was around 1 to 1.25 lakhs blankets per month. At this rate the Army could hope to obtain about 10 lakhs blankets before the onset of next year. The supply may even be less as orders of approx. 10 lakhs were pending on the old suppliers and firms were likely to default as the price of wool was rising. It was therefore recommended to DWE that if shortfall in supply of blankets was to be avoided, there is no other course open except to introduce shoddy blankets of 75% wool content into the Army. At a result of study carried out by DGI in 1973, the estimate proved to be correct. In actual fact the supplies from Traditional Blankets manufacturing units during 1970, 1971 and 1972 against the annual capacity of 10,17000 type 'A' Blankets and 1,56000 Type 'B' Blankets were as under :-
Type 'A' Type 'B'
---------- ----------
1970 6,83,850 42,500
1971 9,53,059 75,000
1972 4,12,150 18,000
The year wise shortfall was therefore as under:-
Type 'A' Type 'B'
---------- -----------
1970 3,53,150 1,13,500
1971 63,941 81,000
1972 6,04,850 1,38,000
77. The DWE in his Note of 3 Mar. 72 stated that he agreed with the R&D views and stated that in case a further temporary relaxation has to be made to tide over the situation, it should not go beyond the limits specified in the R&D Note.
78. On 4 Mar.72 letter No.86800/C/KC/OS-PII was written to DGS&D by Col P.N.REKHI (DDOS(P)) in which he mentioned that the question of acceptance of shoddy blankets with 75% wool content and normal breaking strength was raised in the meeting held on 3 mar . 72 in the office of Secretary Ministry of Supply. He confirmed that blankets made of shoddy wool having 75% wool content and of normal Breaking Strength are acceptable. The copy of this letter was also sent to DI(GS) and GS/WE-9 referring to conversation DOS/DWE of Date. In other words the acceptance of shoddy blankets with 75% wool content to make up the short fall was given with the concurrence of General Staff (DWE).
79. The dues out of blankets during Nov.71 to Apr. 72 was approximately as under:-
Nov 71 - 1003400
Dec 71 - 1126300
Jan 72 - 1002500
Feb 72 - 695500
Mar 72 - 504200
Apr 72 - 591700
82. It was intimated to DGS&D that Ordnance Directorate had a large requirements totalling approximately 20 to 21 lakhs including quantities already on order. It was estimated that traditional suppliers were not in a position to meet the requirements as qty 10.7 lakhs was outstanding on them on 31 Jan 72 and the shoddy blankets industry can meet only part of requirements i.e. about 5 lakhs blankets a year of relaxed specification i.e. 75:25 after meeting normal commercial requirements. It was therefore felt that there was need to back new comers in the field specially if they can supply the blankets of laid down specifications. (As mentioned in para 67, only 4,12150 type A blankets and 18000 type B Blankets were supplied by Trade in 1972).
88. On 3 Apr 72, DGS&D vide Do No. 86800/C/KC/OS-PII was informed that DOS requirements of blankets in 1972-73 subject to the clearance by Ministry of Finance (defense) would be about 18 lakhs approx out of which 12 lakhs were required by Sept 72, ti was also suggested that new suppliers should be tapped as the availability from the orders already placed would be to the extent of 6 to 6-5 lakhs blankets. It was also intimated that any deficiencies which could NOT BE MET BY Specification blankets should be covered by shoddy blanket of 75% wool content and normal breaking strength. (This policy it may be mentioned was exactly on the basis as approved by DWE on 3 Mar 72).
89. On 6 Apr 72 DGS&D was informed vide Do No. 86800/C/KS/OS-P-II that Ministry of Finance (defense) had approved for the placement of an order for 6 lakhs blankets for procurement during 1972/73. ( It will thus be seen that DOS estimate of 20 to 21 lakhs blankets was correct). DGS&D had 14,49811 Nos outstanding or to be covered plus this demand of 6 lakhs made the total as 20,49811). The assessment of likely supply from DOS was given to DGS&D and he was requested for an early converge so that blankets makers do not resort to production of commercial blankets.
94. It has been clearly brought out in para 28 to 47 and summarised in para 48, that the decision for purchase of blankets with relaxed specifications (also termed as sub-standard) was taken by the committee in the Office of Textile Commissioner on 30 Oct 71 to 4 Nov 71. Army's acceptance was conveyed only after obtaining the permission of General Staff (DWE) and DGI. Shri Krishna Woollen Mills was not the only mill from whom the purchase were made by DGS&D, as will be seen from paras 43 and 44. There was no involvement whatsoever in the buying of sub standard blankets. It had to be done by DGS&D, when blankets of proper specification were not available and Chief of Army Staff (COAS) had directed that if necessary, obtaing sanction to buy from open market. It may be useful to state here that in view of the circumstances explained, the specifications were lowered, because if the specifications had been rigidly adhered to the blankets conforming to specification would not have been available and troops would have suffered untold hardships. It would therefore be not correct to assume that sub standard blankets were procured intentionally. The decision to lower specification was taken by officers competent to do so. The circumstances detailed above for going in for shoddy blankets are reiterated. I emphatically deny that there was any involvement in the supply of sub-standard material.
96. It is absolutely incorrect to say that the fighting efficiency of our troops was jeopardised by exposing them to climatic hazards and irregularities in this deal have resulted in substantial loss in Government. There was not a single complaint from any formation regarding supply of blankets or other Ordnance Stores. Campaign reports after the INDO-PAK War 1971 had no adverse comments for Ordnance Corps. At no stage the DGI or R&D, which are the authority on specification, have commented on the Thermal efficiently of these blankets. The allegation is nothing but a conjecture and surmise and is not supported by the material on record. It was known to every one that the life of shoddy blankets with relaxed specification is shorter, but the decision to buy them was approved by General Staff to tie over the acute shortage of blankets in Nov-Dec 71, because there was no alternative available. The choice lay in having the blankets of relaxed specification or do without blankets, which was not possible. At each stage the laid down procedure was strictly followed and necessary sanction obtained. The PAC has perhaps not accorded any consideration to the resources available, from where the blankets could be procured. If the blankets could be procured. If the blankets with the prescribed specifications were available for which each and every source was tapped, the question of lowering the specification would not have arisen.
103. The Allegation that in any step, what to talk of major step, taken with regard to placement of order with M/s Shri Krishna Woollen Mills, the initiative came form me in my capacity as DOS is absolutely wrong and baseless. The facts already detailed above would clearly show to the contrary and openly reveal the opposite. The order vide AT No.571 of 8 Nov 71 as amended by At No. 664 was placed by DGS&D after conference in Bombay on 4 Nov 71. At No. 691 dated 27.11.71 was placed by DGS&D after samples were approved by a Board of Officers on 18 Nov 71 presided by Dy MCO and attended by Dy DOS Maj Gen A.K.BISWAS, Dy. DWE, BI(GS),DDG(N) and others. AT No. 794 dated 21.4.72 was placed on the firm by DGS&D after a detailed discussion on 21 Apr 1972 (PAC Report Para 1.90).
105. The sole aim of the DOS was to provide blankets to troops and in this connection communications were addressed to expedite supplies from which every source available. I had no interest whatsoever in the firm or its proprietors. My one and only aim was to get blankets for the troops for which I had to progress daily and give weekly report to COAS through DCOAS's Weekly conference. Though the issue of blankets is not normally controlled from Army Headquarters, but because of serious supply situation Ordnance Directorate had to freeze stocks in all Depots and control the issue of blankets. Ban had to be placed on condemnation of blankets to conserve existing stocks and unserviceable blankets had to be utilised after washing. all these steps were taken in the interest of country, troops and economy.
107. It is not correct to say that I supported the request of the firm in 1970 to introduce for the first time type 'C' blankets as one of the acceptable qualities. Type 'C' blankets were already part of DGI specification No.IND/TC/1408(e) dated 18 July 1966. Even specification No.IND/TC/1408(g) printed in 1969 has specification for Type 'C' blankets. Obviously Type 'C' blankets specification were introduced in 1966, because of Non availability of wool for type A and B blankets. The allegation falls to ground because C type blankets were introduced much earlier than 1970.
109. It is absolutely incorrect to state that confirmation was sent to DGS&D at my instance that blankets made of shoddy wool having 75% wool contents and of normal breaking strength were acceptable and that the views of DWE and R&D were ignored.
110. It may be stated that this advise pertained to the purchase of blankets for which At No. 794 dated 21.4.72 was placed on M/s Shri Krishna Woollen Mills and another firm as has been given in para 78 this decision was communicated to DGS&D on 4.3.72 by a letter from DDOS(P) Col P.N.REKHI after my talk with DWE on same date. This was done after receipt of letter dated 3.3.72 from DWE based on the advise of DGI and R&D and DWE had allowed further temporary relaxation. Lt. Col. J.C. JOSHI (DGI REP) also confirmed the same in conference in DGS&D Office on 16.3.72. My stand that blankets with relaxed specification were not acceptable was made in the conference of DGS&D on 1.2.72. The 75% wool content relaxation was only accepted for the short fall which could not be made up by specification blankets and only to that extent and not for whole lot. It is reiterated that the condition prevailing impelled that lowering of specification after due consideration in the conference held on 1 Nov 71 and 4 Nov 71 and after the approval of General Staff DWE.
113. The position in detail is explained in para 49 to 51. There was a Telex from the firm giving details of supply and shortages of water addressed for attention of Col.P.N.REKHI DDOS(P). It is quite possible that DDOS(P) may have written. It is quite normal for DGS&D to grant extension. In fact it may be observed that DGS&D not only gave the firm the extension but increased the quantity on demand from 50,000 to 10,0000. Obviously DGS&D was satisfied with the performance of the firm. The extension may have been recommended by DDOS(P) Col.P.N.REKHI keeping in view the reason for delay.
116. In my letter dated on 23 Feb 72 to DWE I had stated the requirements was approx. 21 lakhs blankets including reserves: later same day on 23 Feb 72 I had written to DGS&D that requirements during 1972 were approx. 20 to 21 lakhs including quantities on order. Estimate was given as 18 lakhs in my letter to DGS&D on 3 Apr 72 including demands pending on DGS&D. DGS&D in reply on 6 mar 72 confirmed that demands pending on him ere 14,49800 approx. This requirements was worked out on the basis of procedure in force and policy in vogue.
we asked for sanction of Ministry of Finance (defense) for further 8.91 lakhs. The Ministry of Finance (defense) cleared for the placement of an order for additional quantity of 6 lakhs during 1972/73. It was also hoped that NCC requirements for 2-05 lakhs may also be cleared by the Associated Finance of NCC. This information was passed to DGS&D on 6 Apr 72. A fresh estimate of approx. 18 lakhs including pending demands was given on 3 Apr 72. It may also be made clear that any blankets required for issue in winter of 72 had to be procured before AUG/SEP 73 and it was ideal if these could be procured in early part of 73 when industry is not committed in complying with civil demands.
117. In a conference held on 16.3.72 in the Office of DGS&D with Shri P.NATH DDG(N) in chair Col. P.N.REKHI DDOS(P) gave the break up of requirements as under:-
i) Existing deficiency 60,000 nos
ii) Replacement 4,50,000 "
iii) Mis Airforce etc 2,25,000 "
iv) POW requirements if
they stay 1,50,000 "
v) For new recruits 70,000 "
Total : 14,19,000 Nos.
--------------------
Col. P.N. REKHI further indicated that a demand for 900,00 nos blankets for delivery by Sep 73 will be sent, out of this only 600,000 blankets were approved by Ministry of Finance (defense).When DGS&D informed Ordnance Directorate on 26 Jun 72 that excess coverage has been done. the reply was sent by Maj Gen A.K.BISWAS Offg DOS that there was no objection of that provided deliveries against the indent placed do not exceed 12 lakhs by 31 Mar 73. Therefore, it will be seen that at no stage any attempt was made to misrepresent facts to DGS&D. It is absolutely wrong to conclude that out demands was exaggerated. Even with these efforts the outstanding supplies from DGS&D were 6.57 lakhs as will be seen from Off DOS Maj Gen A.K.BISWAS letter No. 86800/S/KC/RK/CS-PII dated 30 Jun 73 addressed to MGO. There was still no War reserve available and Director Weapon and Equipment (DWE) and Director Military Operation (DMO) were informed by Offg DOS vide his even No. letter dated 7 Jul 73.
121. As per assessment, 12 lakhs blankets were required by Sep 72, our assessment was that availability against demands already placed by DGS&D would be to the extent of 6 to 6.5 lakhs blankets and therefore we wanted further coverage of normal specification blankets. It was decided to procure only that qty with 75% wool content what could not be covered / procured under normal specification. Even DGS&D estimated shortage of 2 to 2.5 lakhs blankets for delivery by Sep 72. It may be of interest to mention that even at this time the dues out of blankets to units were as under :-
Apr 72 - 591700
May 72 - 584900
June 72 - 421880
Jul 72 - 405000
Aug 72 - 366600
124. It was my duty of ensure supplies of blankets and to wipe out dues out to units as listed under para 20.79 and para 121. Even though the offer of M/s Shri Krishna Woollen Mills to supply blankets of normal specification has been sent to DGS&D it was visualised that there will be a short fall in the supply of blankets of normal specifications. DGS&D's estimate given to PAC in para 1.46 of 137th report confirm this and order had to be placed for 4,46,000 blankets on two firms with 75% wool content minimum. Therefore it was perfectly in order to send the offer received fro normal specification from M/s. Shri Krishna Woollen Mills, and also to take up case with DWE for relaxation of specifications as without the concurrence of DWE, we cold not confirm the relaxation to DGS&D. The demand for relaxation i.e. 75% wool content had been raised by shoddy industry on 11.2.72. in the meeting held at Bombay in the Office of Textile Commissioner when shoddy industry agreed to supply blankets with 75% wool contents in lieu of 80% as required under specifications. At this stage we did not have the sanction of General Staff (DWE). DOS representative was to take up the question for acceptance by General and then advise within a week or so, whether they accepted the suggestion made by the shoddy industry. (Para 1.46 of 137th PAC Report refers.) It was for this reason that case was taken up with DWE on 23 Feb 72 and after obtaining the confirmation of General Staff of 3 Mar 72 to the extent of short fall only, approval was conveyed by DDOS(P) Col. P.N.REKHI on 4 Mar 72 to DGS&D that blankets with 75% wool content will be acceptable.
129. In the light of facts given under various paras from the very beginning, it will be seen that this allegation is based on absolutely wrong premises, conjectures and surmises. My concern was not to place large orders on any particular firm, but the object was to meet the requirement of troops, and how badly off we were for the blankets, has been amply highlighted in the proceeding para. All my actions were to protect the defense Personnel against exposure to climate and I have no hesitation in saying that we succeeded in it. There was absolutely no question of placing large orders on any firm. Orders for required quantities were placed on DGS&D to the requirements and that too with the concurrence of Ministry of Finance (defense). I was only concerned that orders be placed on those firms, who have proceed themselves to be reliable and have capacity to meet defense requirements. This I had to do, on more than one occasion, in unambiguous terms."
The order passed in the name of the president and issued under the signature of an Under Secretary reducing the pension of the respondent, which is dated 28.9.1977, is reproduced below:-
"No. 4(2)/76/D (Pension/Services Government of India/Bharat Sarkar Ministry of defense/ Raksha Mantralaya New Delhi, the 28th September 1977.
To The chief of the Army Staff.
Subject : Grant of Retiring Pension :
Lt. Gen. M.S. Sandhu (IC-813) (RETD)
Sir,
I am directed to refer to the letter dated the 24th August 1976, from Ex. Lt. Gen. M.S. Sandhu in reply to the show-cause notice dated 11th June 1976 and to say that the President, after full consideration of the facts, has been pleased to declare the services of Lt. Gen. M.S.Sandhu as unsatisfactory. He has further been pleased to impose a cut of Rs.550/- per month in his pension (i.e. 50% of his normal retiring pension of Rs.1100/- (per month) with effect from 1st June 1975, the date of his retirement. The overpayment already made to him will be adjusted against the balance of death cum retirement gratuity and the residual pension payable to him in future."
A reading of the extracts of the reports of the PAC, the CVC and the contents of the show-cause notice prima facie make out a very grav and serious case of commission of irregularities in the procurement of blankets for armed forces by the DOS during the year 1972 when the respondent was its Director. It the allegations are proved, there evidently appears to be a case of serious misconduct on the part of the respondent. But the grievance of the respondent is that these conclusions have been reached by the PAC and the CVC without giving him a reasonable opportunity of explaining his defense and on the basis of some facts which were not correct and were seriously disputed by him in his reply to the show cause notice. He read over his reply and pointed out the serious dispute of facts raised therein and explaining others. At his instance the appellant filed an extract of the Regulations regarding allocation of business to the Directorate of Supply. It showed that the orle of DOS, among other things was to lay down general policy, estimation, provision, procurement, receipt, accounting, storage, care and preservation and issue of all ordnance stores ammunition and vehicles etc. It was further stated, which fact has not been disputed by the appellant, that DOS was not the final authority to decide about the quantity of stores to be purchased and that all its proposals were processed by hierarchy of senior army officers and it was submitted to the Financial Deptt. of Ministry of defense which examined it and finally approved it before the indent was placed with the DGS&D (Director General of Supply and Disposal) of purchase. It has further been submitted by the respondent, which fact have against been not disputed, that DOS was not the deciding authority about the quality/specification of blankets which were to be procured and that the quality/specification was decided by DWE and that the relaxation in the quality/specification of the blankets, which are said to be sub-standard was also granted by that department after due consideration of the overall position of the stores and the critical need for present and future requirement etc. Again it has been submitted that placing of the order for purchase of the blankets from the market or the blanket manufacture was the job of the DGS&D. The respondent contended that if he was allowed to produce documents and evidence in support of his allegations made in the reply to the show-cause notice, he could not be held responsible for the lapses, if any, committed in the procurement of the blankets. It is stated that he had showed devotion of duty and his work in the DOS was exemplary and the procurement made during his tenure was appreciated by the Government and for that very reason he was awarded Vishisht Sena Medal by the appellant in January, 1975. It was contended that his reply was rejected and the impugned order of cut on his pension was passed summarily. The appeal was also considered and decided without due application of mind by the same officer which had passed the earlier order, so personal hearing provided at that stage was a mere eye-wash and was farce.
Question is what is pension? The pension is a compensation for loyal service rendered in the past. It is in a social welfare measure rendering socio-economic justice by providing economic security in the fall of life when physical and mental prowess is ebbing corresponding to ageing process, and, therefore, one fall backs on savings. It can be said to be a deferred portion of compensation for service rendered (see D.S. Nakara & others Vs. U.O.I. and D.V.Kapoor Vs. Union of India & Others, ). Right of the Government servant to receive pension is property and denial of pension in an infringement of his fundamental rights [see Deoki Nandan Prasad Vs. The State of Bihar and others . Pension is not a bounty but a property. (State of Punjab Vs. K.R. Erry and Sohag Rai Mehta (1973) 1 SCC & Shri D.V. Kapoor Vs. U.O.I. & ors. (supra)].
Pension is, as such, no more a bounty payable on the sweet will and pleasure of the Government but it is a fundamental right of the Government servant to receive it as a property. If it is so, the right of an army personal to the grant of pension after rendering long service cannot be taken away and deprived of otherwise than as provided for in the Pension Regulations.
In our considered view it should not make a difference if the order of cut of the pension was passed under Rule 3 or Rule 5 after a person has retired from service and disciplinary proceedings against him have become barred by rules and judicial proceedings were not initiated. The principles underlying in both the events remains unchanged.
The impugned orders of reduction of the pension have undoubtedly affected valuable property right of the respondent, therefore, a reasonable opportunity of hearing of the defense of the respondent was necessary. The question is whether reasonable opportunity necessarily required holding of a disciplinary, administrative or judicial enquiry or a mere service of show-cause notice and consideration of its reply from the pensioner was sufficient.
It is well settled that if any vested right is created in fiacre of a person the same could not be deprived of or denied without affording to him an opportunity of hearing on the principles of violation of audi alteram partem rule i.e. a person should not be condemned without being heard in hid defense. No decision shall be given against a party without providing him a reasonable hearing. The learned counsel for the appellant has fairly admitted that if action for the grave misconduct committed by the respondent during his tenure of his service as DOS was taken before he attained the age of his superannuation or before the 6 months period expired after his retirement, it could have been taken only resorting to the disciplinary proceedings under the service rules. But he says that after his retirement disciplinary proceedings could not be started against the respondent and the remedy would be by giving him a hearing in response to a show-cause notice. No elaborate recording of evidence or conduct of enquiry would be necessary he urged.
This leads us to the consideration of the Rule of audi alteram partem in some detail. The rules requires affording of a reasonable opportunity of hearing in defense to a person against him an adverse order has been or proposed to be passed. What is the reasonable opportunity, the question then arises. The Supreme Court in Mrs. Maneka Gandhi Vs. VOI & another had made the following observations.:-
"that is why Tucker, L.J. emphasised in Russel V. Duke of Norfolk (1949) 1 ALL ER 109 that 'whatever standard of natural justice is adopted, one essential is that the person concerned should have a reasonable opportunity of presenting his case'. What opportunity may be regarded as reasonable would necessarily depends on the practical necessities of the situation. It may be a sophisticated, full-fledged hearing or it may be a hearing which is very brief and minimal; it may be a hearing prior to the decision or it may be a post decisional remedial hearing."
The Apex Court in State of Punjab Vs. K.R. Erry and Sobhag Rai Mehta (supra) referred to with approval the observations made by it in the State of Orissa Vs. Dr. (Ms) Binapani DEi which are as under :
"An order by the State to the prejudice of a person in derogation of his vested rights may be made only in accordance with the basic rules of justice and fair play. The deciding authority, it is true, is not in the position of a Judge called upon to decide an action between contesting parties, and strict compliance with the forms of judicial procedure may but be insisted upon. He is however under a duty to give the person against whom an enquiry is held an opportunity to set up his version or defense and an opportunity to correct or to controvert any evidence in the possession of the authority which is sought to be relied upon to his prejudice. For that purpose the person against whom an enquiry is held must be informed of the case he is called upon to meet and the evidence in support thereof. the rule that a party to whose prejudice an order is intended to be passed is entitled to a hearing applies alike to judicial tribunals and bodies of persons invested with authority to adjudicate upon matters involving civil consequences. It is one of the fundamental rules of our constitutional set up that every citizen is protected against exercise of arbitrary authority by the State or its officers. Duty to act judicially would therefore arise from the very nature of the function intended to be performed. It need not be shown to be super-added. It there is power to decide and determine to the prejudice of a person, duty to act judicially is implicit in the exercise of such power. If the essentials of justice be ignored and an order to the prejudice of a person is made, the order is a nullity. That is a basic concept of the rule of law and important thereof transcends the significance of a decision in any particular case."
These observations were made with reference to an authority which could be described as characteristically administrative. At page 630 it was observed:
"It is true that the order is administrative in character, but even an administrative order which involve civil consequences as already stated, must be made consistently with the rules of natural justice after informing the first respondent of the case of the State, the evidence in support thereof and after giving an opportunity to the first respondent of being heard and meeting or explaining the evidence."
In a case of a government servant the disciplinary proceedings could not be taken as he had retired from service. The state Government took action against him under the Civil Service Rules which vested power to take action for imposing reduction in the pension. The Supreme Court in state of U.P. Versus Brahm Dutt & Another observed:
"If disciplinary proceedings against an employee of the government are initiated in respect of misconduct committed by him and if he retires from service on attaining the age of superannuation, before the completion of the proceedings it is open to the State Government to direct deduction in his pension on the proof of the allegations made against him. If the charges are not established during the disciplinary proceedings or if the disciplinary proceedings are quashed it is not permissible to the State Government to direct reduction in the pension on the same allegations, but if the disciplinary proceedings could not be completed and if the charges of serious allegations are
established, which may have bearing on the question of rendering efficient and satisfactory service, it would be open to the government to take proceedings against the government servant in accordance with rules for the deduction of pension and gratuity." (emphasis supplied)
Analysing the law as enunciated in the above cited judgments, it is evident that the opportunity of hearing which is contemplated has to be an effective bearing and not perfunctory. The nature of enquiry to be conducted may depend upon the peculiar facts and circumstances and may differ from case to case. Where the facts have already been established by an administrative/ judicial enquiry or in a disciplinary proceeding or where the facts are not in dispute for instance, when the action is based on the adverse annual confidential reports and service record against the delinquent official who had availed of opportunity of representation against the adverse remarks and order no full-fledged enquiry may be necessary. Similar may be an instance where action is proposed against an army officer under Rule 16(a) of the Pension Regulations. The punishment of dismissal/removal from service and cashiering had been awarded in a court martial proceeding. The President for using its discretion may serve a show-cause notice, receive a reply and then may decide whether the delinquent official is entitled to full retiral benefit or not. If at the time of deciding whether a person would get full pension or not because of some disciplinary action taken against him or his conviction in a criminal case by a court of law or where the necessary facts constituting the misconduct are admitted no detailed enquiry or recording of evidence is necessary. But in case the facts are intricate, are extensively controverter and their establishment is necessary for constituting a misconduct or defense a brief enquiry will not serve the purpose. It would not provide an effective and reasonable hearing to the delinquent who will be immensely prejudiced in his defense if not allowed to prove it by documentary or oral evidence. This will be all the more necessary in case the pension has already been granted to him.
The learned counsel for the appellant has stated that clause (ii) of the memorandum of the Government dated 4.7.1975 which laid down the special circumstances for exercise of powers under Regulation 5 provided that the powers given by Regulation 5 could be used for withholding the pension etc. in case the delinquent is guilty of grave misconduct, and that the respondent is guilty of a grave misconduct no doubt. The Government Memorandum dated 4.7.1975 has already been reproduced in the paragraphs above. A reading of the clause to which our attention has been drawn there is indeed force n this submission. The conduct of the respondent, if proved, would amount to a grave misconduct and lack of devotion to duty. But the clause takes into ambit serious crimes under IPC Official Secrete Act or any other special law as well. A person cannot be said to have been guilty of an offence in a criminal case unless he is convicted of that offence by a competent court. He will not be guilty of that offence merely on the registration of a case against him. It has been fairly conceded by the learned counsel for the appellant that the appellant did not propose to reduce or withhold the pension of the respondent for recovering the whole or the part of the pecuniary loss suffered by it because of the misconduct of the respondent and other officers. He only relied upon clause (ii) referred to above. A delinquent official, who committed acts of indiscipline or misconduct before he retired from service, cannot be deprived of a hearing in a proper inquiry into the matter. The misconduct on his part has to be proved/established by evidence. His rights to have effective hearing would not be lost on his ceasing in the employment and service and the employer's remedy of disciplinary proceedings having become barred by time. The principles of law laid down by the Supreme Court in the above cited cases clearly spell out the scope of enquiry which is to be conducted in case the facts of a particular case so warranted.
It is, thus, noteworthy that the nature of the hearing which is to be provided by the authority which proposed to pass an order which affects the civil rights of a person, may vary from case to case. If the facts of a case so warranted, a full-fledged enquiry which allows the person concerned to produce evidence in his defense may be necessary for complying with the rule of audi alteram partem. In other cases there may be a minimal or brief hearing. The hearing so provided may be at the stage prior t the decision or may be even a post decision hearing. There cannot be any hard and fast rule but the hearing has to serve the purpose for which it is ordained otherwise, it would be in violation of the rule of natural justice. As shown by his reply to the show cause notice extracted in detail above, the respondent had disputed important facts alleged in show cause notice and had pleaded certain facts in defense and before a decision was taken, they were required to be properly proved and established by evidence. This has not been done. Therefore, the process of decision making in this case is improper, defective, suffers from arbitrariness and does not seems to be fair.
Post decision oral hearing provided in appeal to the respondent by a Joint Secretary of the appellant is inconsequential firstly because it cannot be said to be a reasonable opportunity on the facts and circumstances of this case and secondly because the hearing was given by an officer holding the rank of Joint Secretary against an order which was passed by him or another Joint Secretary. We need not reproduce the contents of appeal and the decision taken thereon for these reasons.
We do not find it necessary to reappraise the material which was before the competent authority when the decisions which were under challenge, were taken. As a matter of fact in exercise of the jurisdiction conferred by Article 226 of the Constitution of India this court can review an administrative order only to find out if the decision was illegal or suffered from procedural impropriety or it was based on a material which is not relevant or some relevant material evidence has been excluded (see UOI and another Vs. G. Ganayutham ). The Appex court in this judgment has laid down the parameter of judicial review of an administrative order. It has already been observed that the procedure adopted for decision making in the instant case was not proper as it has deprived the respondent of an effective and reasonable opportunity of hearing in defense of his case.
The learned counsel for the appellant has referred to some case law in support of his argument that detailed and full-fledged enquiry was not necessary before passing the impugned orders. He referred to UOI & others Vs. V. Dev . In this case the respondent was posted in High Commission of India in London on deputation basis. After the expiry of the deputation period he was transferred back to his parent department in Delhi. The respondent made representation for prolonging his stay in London on various excuses for not handing over the charge. he was relieved from duty and was directed to report at Delhi immediately. He did not do so. Disciplinary action taken again him for misconduct for disobeying the order which amounted to lack of devotion to duty and his conduct being unbecoming of a Government servant. The enquiry report was submitted. In the meantime the date of his superannuation reached. It was decided that he should not be granted full pensionary benefit for which a show-cause notice was served on him. The respondent sent a representation. The Union Public Service Commission (UPSC) advised that his full pensionary benefit could be withheld. The President then ordered withholding full pensionary benefit of the respondent. The facts of this case would show that a full-fledge enquiry on the charge was conducted but recourse to the withholding of pensionary benefit was taken since in the meantime he reached the age of retirement. In another case State of Punjab Vs. K.R. Erry and Sobhag Rai Mehta's case (supra) though the respondent was not joined in the administrative and judicial enquiry conducted by the court, the enquiries were held into the imputations of charge against the official and one of which was conducted by a Judge of the High Court. The facts are, therefore, distinguishable since his guilt was established in an administrative inquiry conducted by a Judge. In the case of A.R.R. Deshpande Vs. UOI & another (1971)(2) SLR 776 it was held that in view of the Article 470 of Civil Services Regulation for pension was admissible to a Government servant only if the services of the civil servant had been thoroughly satisfactory but it was further observed that the procedure in departmental proceeding need not be governed by law but it should be regulated by rules of natural justice. In the cited case a full departmental enquiry was conducted in which it was held that the concerned official had made illegal gains while in service amassed money much beyond the know sources of his income. In another case State of Uttar Pradesh Vs. Braham Dutt and another (supra) it was held that the Govt. can reduce, forfeit, withhold or recover pension after affording hearing to the affected person on the ground of unsatisfactory service based on proof of finding of serious misconduct or causing pecuniary loss to the Government. In this case also it was held by the Apex court that action can be taken after serious allegations have been established. here in the instant case there were serious disputes about several important imputations which have not been established/proved. Case of Takhatray Shivadattray Mankand Vs. State of Gujarat was also relied upon. It was found that instead of giving a proper reply to the show cause notice against the proposed reduction of pension on account of unsatisfactory service the appellant had entered into long correspondence spread over six years with the State Government which was constrained to pass the impugned order. Therefore, this case is based on its own peculiar facts. This case was based on Rule 139 of Bihar Pension Rules which empowered the Government as a revisional authority to reduce the pension of a servant whose service was not thoroughly satisfactory or there was a misconduct. It was held "so far as the second type of cases is concerned the number of grave misconduct on the part of the concerned Government servant during his service tenure will have to be culled out by the revisional authority from the departmental proceedings or judicial proceedings which might have taken place during his service tenure or from departmental proceedings which may be initiated even after his retirement in such type cases." The case of State of Madhya Pradesh Vs. Col. R.P. Singh was also on its own peculiar facts. It was observed that pension was normally always a matter of course when there was no law governing it and implicit in the grant of pension was that it could be satisfactorily reviewed and the succeeding Government was competent to review it. It was a case where Ruler of the State of Rewa before the merger of the State had granted pension to an employee and the succeeding Government had reduced the pension after the merger. In anther case cited as M. Narasimhachar Vs. State of Mysore (1960) SC 247 the contention raised before the Apex court was against reduction in the pension amount. It was argued that in view of Article 311 of the Constitution the person concerned was entitled to a show-cause notice. This argument was repelled and it was observed that "it has nothing to do with reduction of pension, which is specifically provided for in Article 302 of the Regulations. That Article says that if the service has not been thoroughly satisfactory, the authority sanctioning the pension should make such reduction in the amount as it thinks appropriate. There is a note under this Article, which says that full pension admissible under the Regulations is not to be given as a matter of course but rather to be treated as a matter of distinction. It was under this Article that the Government act when it reduced the pension to two third reduction in pension being a matter of discretion with the Government. It cannot, therefore, be said that it committed any breach of the Regulation in reducing the pension of the appellant." In D.V. Kapoor Vs. UOI & another JT (supra) the officer had not reported on duty after his transfer from Indian Commission at London. he was to report at New Delhi and the enquiry officer found that though the appellant derelicted his duty to report to duty it was not willful for the reason that he could not move due to his wife's illness and he recommended to sympathetically consider the case of the appellant and the President accepted these findings but decided withholding the payment of pension in consultation with UPSC. However, the Civil Services Pension Rule 9 empowered the President to withhold pension if in a departmental or judicial proceeding the pensioner was found guilty of grave misconduct or negligence during the period of his service. The judgment, therefore, does not advance the case of the appellant.
As a consequence in the peculiar facts and circumstances of the case, we are in respectful agreement with the view of the learned Single Judge that the imputations of the charge of grave misconduct and irregularities committed by the respondent while working as DOS is the matter of the purchase of blankets has to be established and proved by an administrative/disciplinary/judicial enquiry before the competent authority exercise its power under Regulation 3 or 5 of the Pension Regulations and order reduction in the pension which had already been granted to the respondent in this case.
We do not find any merit in the appeal. We dismiss it. But it will not debar the appellant from passing appropriate order under Pension Regulations against the respondent after giving him reasonable opportunity of hearing mandated by audi alteram partem rule as explained in the judgment. In the circumstances, the parties shall bear all their costs.
