Gujarat High Court
Ghanshyam K Chauhan Lic ... vs Life Insurance Corporation Of ... on 16 March, 2021
Bench: Sangeeta K. Vishen
C/SCA/16057/2011 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 16057 of 2011
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS. JUSTICE SANGEETA K. VISHEN
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1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy
of the judgment ?
4 Whether this case involves a substantial question
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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GHANSHYAM K CHAUHAN LIC DEVELOPMENT OFFICE
Versus
LIFE INSURANCE CORPORATION OF INDIA & 22 other(s)
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Appearance:
MR.DISHANT K THAKKAR(7309) for the Petitioner(s) No. 1
MR UDAYAN P VYAS(1302) for the Respondent(s) No. 1,2,3
RULE SERVED(64) for the Respondent(s) No. 1,2,3
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CORAM: HONOURABLE MS. JUSTICE SANGEETA K. VISHEN
Date : 16/03/2021
ORAL JUDGMENT
1. By this petition, inter alia, under Article 226 of the
Constitution of India, the petitioner has prayed for quashing
and setting aside the order dated 22.8.2008 passed by the
Senior Divisional Manager, (Disciplinary Authority) i.e. the
respondent No.3; the order dated 31.3.2009 passed by the
Zonal Manager (Appellate Authority), i.e. the respondent No.2
and the order dated 6.4.2010 passed by the respondent No.1,
i.e. the Chairman.
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1.1 By the order dated 22.8.2008, penalty of withholding of
two increments, permanently in the pay scale of the petitioner
in terms of Regulation 39 (1)(b) of the Life Insurance
Corporation of India (Staff) Regulations, 1960 (hereinafter
referred to as 'the Regulations of 1960'), has been imposed.
2. Tersely stated are the facts :-
2.1 The petitioner is working as a development officer with
the Life Insurance Corporation of India (hereinafter referred to
as "the Corporation"), at Nadiad since the year 1990 and his
service as development officer is regulated under the
Regulations of 1960. The incident relates to the issuance of two
policies viz. No.876549500 and no. 876549517, both dated
6.7.2006 for an amount of Rs.5 lac and Rs.2.5 lac respectively
(hereinafter referred to as "the policies").
2.2 According to the petitioner, the proposal Nos.1377 and
1379, both dated 6.7.2006 on the life of Smt. Pratiksha G.
Patel, were introduced by Shri B.S. Sodha, Agent, working
under the organization. On the basis of the Agent's
Confidential Report of the agent as well as Moral Hazard Report
(hereinafter referred to as 'MHR') of the petitioner, the
proposals were accepted and resulted into policies, with effect
from 15.7.2006. According to the Corporation though the life
assured was undergoing treatment and was having 20 weeks
pregnancy as on 6.7.2006, the petitioner, without making any
independent inquiries and without revealing the truth, has
defrauded the Corporation by accepting the risk on non-
insurable life, which otherwise would not have been accepted.
2.3 Apropos the aforesaid incident, the respondent no.3,
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issued a letter dated 20.1.2007 seeking explanation from the
petitioner as to why the petitioner did not submit correct
information. The petitioner submitted his reply dated
19.2.2007, inter alia, pointing out that it is likely that the life
assured must have suppressed the material facts, namely, her
pregnancy at the time of the proposal and previous policy;
however, the pregnancy could not have been judged by a non-
medico person. Also, the Doctor who had thoroughly examined
the life assured could not detect the 20 weeks' pregnancy. In
the reply it was urged that there was no ill intention or any
inducement on the part of the petitioner, for issuance of the
policies, on the basis of the false statement.
2.4 It is the case of the petitioner that without considering
the reply, the respondent no.3 straightaway issued the charge-
sheet dated 22.10.2007. The main charge was that though the
life to be assured was having 20 weeks pregnancy as on
6.7.2006, the petitioner has given MHR under both the policies
without making independent inquiries. Another charge was to
the effect that by giving MHR, the petitioner has defrauded the
Corporation by accepting the risk on non-insurable life which
otherwise would not have been accepted. Therefore, the
petitioner has committed a breach of Regulations nos.21 and
24 read with Regulation No.39(1) of the Regulation of 1960.
Therefore, penalties specified under regulation 39(1)(a) to (g)
of the regulation of 1960 shall not be imposed.
2.5 The petitioner submitted his written reply to the charge-
sheet dated 22.10.2007 reiterating his explanation viz; that the
MHR was given after thorough independent inquiry. Further,
the Corporation's panel Lady Medical Examiner (Gynecologist)
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had not reported/recorded any pregnancy conceived by the life
assured, in the medical report. The petitioner also stated that
the physical appearance of the life assured was not indicating
any visible symptom of pregnancy and therefore, being a non-
medical person, it was not possible to have judged, from the
physical appearance, the pregnancy of the insured. Therefore,
the petitioner has not committed any breach of Regulations 21
and 24 of the Regulation of 1960.
2.6 The Corporation thereafter appointed an inquiry officer.
According to the petitioner, the inquiry proceeding commenced
on 3.1.2008 and continued till 13.3.2008. During the
proceeding, the petitioner, through his representative, had
asked for certain documents; however, the petitioner was
supplied only the photo copy of review slip of proposal
nos.1377 and 1379 containing the decision dated 11.2.2008 of
the B.O. officials and was informed that other documents as
demanded, cannot be made available as the same are not
relevant for the purpose of inquiry proceeding.
2.7 After completion of the inquiry proceeding, the presenting
officer as per the oral instructions of the inquiry officer,
submitted his written submission dated 16.3.2008, inter alia,
stating that the charge-sheeted employee has seen the
proposal form and has himself filled the answers. Filling up of
MHR clearly proves that the charge-sheeted employee has not
taken due care in submitting the proposal forms. The petitioner
was asked to submit his written response, which was done vide
reply dated 27.3.2008, denying the charges. It is thereafter
that the inquiry officer submitted his inquiry report dated
16.4.2008, inter alia, observing that on the strength of the
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proposal form and MHR submitted by charge-sheeted
employee, the Corporation accepted the risk. Had the fact
been clearly mentioned, the risk would not have been
accepted by the Corporation. The inquiry officer ultimately held
that the charges are proved.
2.8 The Manager (P&IR) vide letter dated 19.4.2008 sent the
inquiry report to the petitioner requiring him to submit his
response and the petitioner submitted his reply. Thereafter,
show cause notice dated 21.6.2008 was issued, inter alia,
observing that the petitioner has been held provisionally guilty
of all the charges. It is therefore proposed to impose a penalty
of withholding of two increments permanently in the pay scale
applicable to the petitioner. The petitioner submitted his reply
dated 14.7.2008 to the show cause notice, reiterating his stand
and more particularly, the fact that the presenting officer has
not produced any independent evidence/witnesses to prove
that the MHR was given without making any independent
inquiry.
2.9 After considering the reply of the petitioner, the
respondent no.3 issued a final order dated 22.8.2008 in
exercise of powers under regulation 39(1)(b) of the Regulation
of 1960, imposing penalty of withholding of two increments
permanently in the pay scale applicable to the petitioner. The
petitioner being aggrieved by the aforesaid order dated
22.8.2008, preferred an appeal before the respondent no.2.
who, after examining the case, did not find any merit and
rejected the appeal vide order dated 31.3.2009, observing that
petitioner has not brought out any new or cogent points
warranting modification in the penalty imposed by the
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disciplinary authority and thereby the penalty stood confirmed.
The petitioner aggrieved by the said order dated 31.3.2009,
preferred the proceeding under regulation no.49 of the
Regulations of 1960. However, the respondent No.1 -
Chairman, vide order dated 6.4.2010, did not find any merit
and while confirming the penalty imposed by the Disciplinary
Authority and the Appellate Authority, observed that the
penalty imposed commensurate with the gravity of the
misconduct, for which the petitioner was found guilty.
3. Being aggrieved by the order dated 22.8.2008 passed by
the Disciplinary Authority; the order dated 3.3.2009 passed by
the Appellate Authority, and; the order dated 6.4.2010 passed
by the respondent no.1, the petitioner has preferred the
captioned writ petition with the aforementioned prayers.
4. The Corporation, while vehemently opposing the writ
petition, has filed a detailed reply. The specific case of the
Corporation is that pursuant to MHR, it undertook the risk on
the life of the proposed assured and effected the policies, one
under "Jeevan Tarang" and another under "Money Back Plan"
commencing with effect from 15.7.2006.
4.1 According to the Corporation, the petitioner, being a
development officer, was expected to have performed his
duties diligently, however, he failed in undertaking
independent inquiry before filing the MHR and owing to the
said negligence the policies came to be issued in favour of the
life assured. It is further averred that within 14 days from the
date of the commencement of the policies, a death claim was
received by the Corporation reporting that the assured has
expired on 29.7.2006 due to Septicemia at Maha Gujarat
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Hospital & Maternity Home at Nadiad. While inquiring into the
veracity of the claim, it was revealed, vide letter dated
13.11.2006 from Dr. Yogini N. Patel, Gynecologist, under whom
the life assured was taking treatment, that the life assured was
having 20 weeks pregnancy on the date on which the
insurance was effected.
4.2 It is the case of the respondents that in spite of the fact
that the present petitioner, as development officer had an
occasion to see the deceased assured, 2 to 3 times, the
petitioner had furnished false information in the MHR, showing
the deceased assured as not carrying any pregnancy and failed
to exercise the duty with due care and caution which, an officer
of ordinary prudence ought to have exercised in such
circumstances and having failed to do so, the petitioner has
defrauded the Corporation to accept the risk of non-insurable
life.
4.3 It has been further averred that merely because the
panel doctor could not detect the pregnancy, does not absolve
the petitioner from performance of his duty, of exercising due
care and caution, inasmuch as, the scope and area of making
an inquiry was much wider in case of the development officer
than the scope of medical examination undertaken by a doctor
in such cases. The petitioner has failed to perform his duty with
devotion and has acted in a manner detrimental to the interest
of the Corporation and thereby, committed a breach of
regulations nos. 21 and 24 read with regulation no.39(1) of the
Regulations of the 1960, as a result of which, the penalty has
been imposed by passing the order dated 22.8.2008.
4.4 It is further stated that while conducting the disciplinary
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proceeding against the petitioner, he has been afforded
sufficient opportunity of representing his case and it cannot be
said that the inquiry has been initiated in breach of the
principles of natural justice. Further, even after affording
adequate opportunity of producing witnesses, the petitioner
could not produce any of the witnesses as desired by him
before the inquiry officer. Moreover, the petitioner was asked
thrice, as to whether he is desirous of producing any
documents in support of his defence, but on every occasion,
the petitioner has answered the same in negative. It is
therefore stated that the petitioner has been afforded a
reasonable and fair opportunity of defending his case and
therefore, the final decision of imposing penalty was passed,
fully adhering to the principles of natural justice.
4.5 While referring to the Medical Examiner's Confidential
Report, it is stated that an explanation was also sought from Dr
Janki Amin, Gynaecologist , a panel doctor of the Corporation,
and had tendered her explanation. In the explanation, it was
pointed out by her that the life assured was specifically asked
about her last menstruation date and was accordingly recorded
as 1.7.2006. As the party was not carrying any pregnancy, on
the date of medical examination, and after having her
completely examined, that the report was submitted. It is
further the case of the Corporation that the explanation
tendered by the doctor was forwarded to the Divisional Medical
Referee for his recommendation, who in turn, opined that Dr
Janaki Amin had probably missed the pregnancy and therefore,
partly she was misguided by the party and partly she was
responsible for the medical examination. The Divisional
Medical Referee recommended that the benefit of doubt be
C/SCA/16057/2011 JUDGMENT
given to Dr Janki Amin. Accepting the recommendation, no
action was taken against her.
4.6 While referring to the policy received at Anand office, it is
stated that explanations were sought from the concerned
development officer so also the agent of the Corporation.
However, accepting the explanation dated 28.1.2007
submitted by Mr P.H. Soni, development officer, the respondent
no.3 being a competent authority, by an order dated
22.12.2008 issued strict warning to him to be more careful in
future. It is stated that the case of Mr. P.H. Soni cannot be
equated with the case of the petitioner inasmuch as Mr P.H.
Soni was the person who brought the fact of the life assured to
the notice of the Corporation.
4.7 It is stated that neither is there any irregularity, illegality,
arbitrariness or unreasonableness in the decision making
process impugned in the present petition nor the penalty
imposed is unfair and unreasonable, warranting interference
by this court in exercise of its powers under article 226 of the
Constitution of India , as the judicial review is not directed
against the decision but confined to the decision making
process. It is thus, urged that the petition deserved to be
dismissed.
5. Mr. Dishant K. Thakkar, learned advocate for the
petitioner submitted that the petitioner did not commit any
breach as envisaged under Regulations 21 and 24 of the
Regulations of 1960. It is true that MHR dated 6.7.2006 was
submitted by the petitioner, however, the same was based on
an independent inquiry made by the petitioner about the life of
the deceased assured. The physical appearance of the life
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assured was quite healthy and was not indicative of any
pregnancy. It is submitted that the Inquiry Officer so also the
other authorities, in absence of any evidentiary proof, about
the visible symptom of 20 weeks pregnancy of the life assured,
on the date of filling up of the MHR on 6.7.2006, has wrongly
concluded that the same was quite visible. It is submitted that
therefore, the said findings are not based on any evidence and
therefore the order dated 22.8.2008 passed by the respondent
No.3 is bad in law.
5.1 It is next submitted that in fact, MHR was submitted after
independent inquiry and thorough scrutiny. The aspect that life
assured was not carrying any pregnancy, was corroborated by
the Medical Examination Report of the life assured, which
recorded that there is no evidence of pregnancy. Further in the
explanation of the panel doctor i.e. Dr. Janki Amin, it has been
stated that a specific question as regards the last menstruation
was put to the life assured and in response whereof, the date
give was 1.7.2006. It is therefore, submitted that, if doctor,
after fully examining the life assured was not able to identify
about the pregnancy, the petitioner being a non-medico person
cannot be expected to have found out that the life assured was
pregnant.
5.2 It is next submitted that even otherwise the petitioner
was not the final authority for sanctioning the policies for, as
per the procedure prescribed, the ACR, i.e. Agent's Confidential
Report is prepared by the agent concerned. The said proposal
form further carries the details of the medical examination
certifying the health of the life assured and it is thereafter, that
the MHR is required to be filled in by the development officer.
C/SCA/16057/2011 JUDGMENT
The petitioner on the basis of the details available with him, so
also the Medical Examiner's Confidential Report has filled in
the details and signed it on 6.7.2006. The proposal was then
placed before the Branch Manager's Committee (hereinafter
referred to as 'the BMC") comprising four members which after
scrutinizing and examining all aspects, approved the policy.
While inviting the attention of this Court to the proposal review
slip, it is submitted that the slip carries the signature of the
underwriter, i.e. the Branch Manager, who is the head of the
Committee. Therefore, it cannot be said that the petitioner was
the sole and final authority to sanction the proposal and had
issued the policies. Had the BMC any doubt, it would have
directed the inquiry about the genuineness of the life assured;
however, the proposal was finally approved by the BMC and
therefore, it cannot be said that the petitioner has committed
any error intentionally or that he has defrauded the
Corporation.
5.3 While adverting to the case of Dr. Janki B. Amin, it is
submitted that she was a panel doctor of the Corporation and
had given her Medical Examiner's Confidential Report dated
6.7.2006 in respect of the life assured. In fact, it was the
doctor's duty and responsibility to have properly examined the
medical status of the life assured. However, in the Medical
Examiner's Confidential Report, there are no details as
regards the pregnancy of the life assured. The Medical
Examiner's Confidential Report was attached along with the
MHR of the petitioner, however, the respondent authorities
have adopted different stand. After seeking explanation from
Dr. Janki Amin and considering her case, she was
recommended of giving benefit of doubt which was accepted
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and no action has been taken against her.
5.4 While referring to the earlier policy issued by the Anand
division, it is stated that, 24 days prior to the issuance of the
policies in question, another division namely, Anand had also
issued policy in favour of the very same life assured which was
accepted by the concerned development officer Mr P.H. Soni
however, the Corporation had simply asked for his explanation
and he having offered his explanation dated 28.1.2007, it
issued a warning to him that he should be careful in future. It is
therefore submitted that the petitioner should also have been
accorded similar treatment as was accorded to Mr Soni for, the
policies were issued in favour of the life assured, under the
similar circumstances.
5.5 It is further contended that in the MHR, submitted by Mr.
P.H. Soni, there was no reference of the life assured carrying
any pregnancy and therefore, the case of the petitioner so also
the case of Mr. Soni being similar, the authorities were not
justified in initiating the disciplinary proceeding against the
petitioner and doing away with the disciplinary proceeding
against Mr. P.H. Soni, development officer by issuing a strict
warning. It is submitted that the explanation in the case of the
petitioner was not accepted and that too without any cogent
evidence. Not only that, the respondent authorities have not
considered the fact that the petitioner at the relevant point of
time had requested for lodging of FIR against the life assured,
however, till date, no permission has been granted.
5.6 It is submitted that the respondent authorities have
discriminated the petitioner inasmuch as, the development
officer of Anand Branch, i.e. Mr. P.H. Soni so also Dr. Janki Amin
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panel doctor, who were also equally responsible, with process
of issuing policies, were given strict warning and benefit of
doubt, respectively. However, the disciplinary proceeding was
initiated against the petitioner, which culminated into the order
dated 22.8.2008, imposing penalty of withholding of two
increments permanently and therefore, on this ground alone
the orders passed by the respondent authorities deserve to be
quashed and set aside.
5.7 While adverting to the inquiry proceeding, it is submitted
that the same suffers from the breach of the principles of
natural justice because, the petitioner though had specifically
asked for the documents, as indicated in the letter dated
24.1.2008, the documents were not provided to the petitioner
on the ground that they are not relevant to the disciplinary
case. It is submitted that had the documents been provided to
the petitioner, which go to the root of the matter, the
petitioner would have been in a position to satisfy the
Corporation that the petitioner has not committed any
misconduct. However, the request of the petitioner was turned
down, which had deprived the petitioner to put forth his case
effectively.
5.8 It is further submitted that during the inquiry proceeding,
on 21.2.2008, a specific contention was raised on behalf of the
petitioner that owing to the non-supply of the relevant
documents, he has been subjected to prejudice, which would
amount to denial of reasonable opportunity. Reliance is placed
on regulation no.2 (C) which deals with the aspect of
production of documents by the disciplinary authority. It is
submitted that it was incumbent upon the Inquiry officer to
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have called for the documents, which the petitioner desired;
however, the inquiry officer failed to adhere to the said
requirement
5.9 Next it submitted that petitioner had requested the
inquiry officer to examine Mr Tushar Pandya the Branch
Manager and the request was acceded to by the inquiry officer
but the witness did not remain present. The attendance of Mr
Tushar Pandya, the Branch Manager, would have been in the
right earnest because he was the chairman of the BMC, which
took the final decision. In such circumstances, it was the
obligation of the inquiry officer to have summoned the witness;
so also other members of the BMC which had taken the final
decision, approving the policies. Moreover, as per the
guidelines laid down by the Corporation, it cast a duty upon
the inquiry officer to summon the witnesses, however, the
inquiry officer failed to adhere to the said regulation. Resulting
into deprivation to the petition of a reasonable and fair
opportunity to defend his case. Therefore, it is incorrect on the
part of the Corporation to say that sufficient opportunity was
afforded to the petitioner for defending his case and that
inquiry has been conducted in a fair and reasonable manner.
5.10 It is further submitted that clause (D) of the guidelines
provides for summoning of witnesses and it was incumbent
upon the Inquiry Officer to have addressed a letter to the
witnesses proposed to be produced on behalf of the accused
employee. In fact, it is the duty cast upon the Inquiry Officer to
take all necessary steps to secure the attendance of the
witnesses on both the sides. In the present case, the petitioner
having named the witnesses to be examined and they having
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not appeared, during the inquiry proceeding, the Inquiry
Officer could have compelled the attendance of the witnesses,
however, the Inquiry Officer did not do so and failed to adhere
to the requirement of clause 2(D) of the guidelines governing
the inquiry proceedings.
5.11 It is next submitted that the action of the respondent
authorities does not inspire any confidence inasmuch as,
though the petitioner had sought for permission to lodge the
FIR, the same has not been granted. Secondly, no action has
been taken against the life assured or the husband at the
relevant point of time. Moreover, the Corporation has not
suffered any monetary loss as the death claim has been
rejected and therefore, it cannot be said that the Corporation
had suffered any monetary loss because of the improper filing
of the MHR.
5.12 It is thus, submitted that the order dated 22.8.2008
passed by the respondent No.3 followed by the order dated
3.3.2009 by the Appellate Authority and also the order dated
6.4.2010 passed by the respondent No.1, are in violation of the
principles of natural justice, discriminatory and deserves to be
quashed and set aside.
6. Mr. Udayan P. Vyas, learned advocate appearing for the
Corporation, submitted that considering the recommendation
of the petitioner, pursuant to the MHR, the Corporation has
issued policies, one under "Jeevan Tarang" and another under
"Money Back Plan" of the Corporation bearing policy
nos.876549500 and 876549517 commencing from 15.7.2006
on the life of the assured. Immediately, within a span of 14
days from the date of commencement of the policies, a death
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claim was received by the Corporation reporting that the life
assured has expired on 29.7.2006 due to Septicemia. It is
further submitted that the petitioner, as development officer
had an occasion to see the deceased assured 2 to 3 times, but
has failed to exercise duty of due care and caution, which, an
officer of ordinary prudence is expected to exercise in such
circumstances. Having failed to do so, the petitioner defrauded
the Corporation to accept the risk to non-insurable life.
6.1 It is next submitted that the petitioner has placed heavy
reliance upon the Medical Examiner's Confidential Report.
Merely, because the panel doctor could not detect the
pregnancy, will not absolve the petitioner from his duty of
exercising due care and caution. As a prudent development
officer, he is not only obligated to enquire about the health and
whereabouts of the proposed assured on all counts, but is also
expected to enquire about the health and other aspects of the
proposed assured from outsiders or other agencies. The scope
and area of making inquiries is much wider in the case of
development officer than the scope of medical examination
undertaken by a doctor. However, the petitioner failed to make
an independent inquiry before submitting the MHR and
resultantly, has failed to perform his duty with devotion and
has acted in a manner detrimental to the interest of the
Corporation. The said conduct, has resulted in commission of
breach of Regulation nos. 21 and 24 of the Regulations of
1960.
6.2 While adverting to the proceeding against Dr. Janki Amin,
a Gynecologist and panel doctor, it is submitted that Dr. Janki
Amin was also asked to furnish her explanation, who vide
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letter dated 6.2.2007 has tendered explanation, inter alia,
pointing out that during the examination, the life assured was
asked all the relevant questions and the same were duly
recorded in the medical report. It is submitted that the case of
Dr. Janaki Amin was forwarded to the Divisional Medical
Referee, who in turn has recommended giving benefit of doubt
to Dr. Janki Amin, as she probably has missed the pregnancy
and therefore, partly she has been misguided by the party and
partly she is responsible. It is submitted that considering the
role played by the Dr. Janki Amin, she was given the benefit of
doubt as recommeded by the Divisional Medical Referee.
6.3 Adverting to the aspect of parity, it is submitted that the
said contention is misplaced. While referring to the case of Mr.
P.H. Soni, development officer at Anand office, it is submitted
that a death claim was also received at Anand office pursuant
to the policies effected on the life assured. However,
explanation was sought for from the concerned development
officer and pursuant to the explanation received, it was
decided to accept the same, considering the fact that Mr. P.H.
Soni, development officer had helped the office to unearth the
true facts. It was therefore, decided that a strict warning may
be given to Mr. P.H. Soni, development officer about being
more careful in future. However, so far as the petitioner is
concerned, it is submitted that one more complaint was
received from one Ramesh Patel, inter alia, alleging that
although the fact that the life assured being pregnant was
brought to the notice of the petitioner, the petitioner had
remarked that the life assured will get the insurance.
6.4 It is, therefore, submitted that the parity drawn by the
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petitioner cannot be accepted as, the case of the present
petitioner is not comparable with the cases of Mr. Soni,
development officer of Anand Division so also of Dr. Janki Amin,
the panel doctor. It is, therefore, submitted that there is no
violation of Article 14 of the Constitution of India and that the
petition has not been subjected to pick and choose policy only
with a view to victimising and harassing the petitioner.
6.5 While adverting to the inquiry proceedings initiated
against the petitioner, attention is drawn to the minutes of the
inquiry proceedings and more particularly, the queries put by
the Inquiry Officer to the petitioner and the replies by the
petitioner. It is submitted that the Inquiry Officer has
specifically required the petitioner as to whether he is desirous
of placing any documents on the record. In response whereof,
the petitioner has given his reply in negative. Similarly, the
petitioner was also offered an opportunity to present his
witness to which, a request was made on behalf of the
petitioner to examine all the members of the BMC who were
present at the time of decision of proposal nos.1377 and 1379.
However, it was the petitioner, who could not produce the
witnesses for examination. Since there was a failure on the
part of the petitioner in not producing the witnesses, the blame
is put on the Inquiry Officer and the organization.
6.6 While inviting the attention to the inquiry proceedings
dated 21.1.2008, it is submitted that the assisting employee
was again offered an opportunity as to whether he is desirous
of producing any witness and he reiterated his request of
examining two members of the BMC. Further, the Inquiry
Officer has asked the assisting employee, if he is desirous to
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produce any other evidence, the assisting employee has
expressed his willingness to examine another two persons,
namely, Mr. B.S. Sodha, the agent and another development
officer from Anand Shri P.H. Soni. However, the assisting
employee failed to produce the witnesses for examination. It is
submitted that therefore, it cannot be said that opportunity
was not accorded to the petitioner to put forth his explanation
in support of the charges levelled against him.
6.7 It is submitted that therefore, the inquiry was conducted
in a fair and transparent manner observing all the parameters
governing the inquiry proceedings; fullest opportunity of
hearing was accorded to the petitioner. The Inquiry Officer at
the end of the inquiry, has found that the petitioner was
negligent in performing his duties. Upon receipt of the report
from the Inquiry Officer, the Disciplinary Authority has issued a
show cause notice and duly replied by the petitioner and after
considering the reply, the disciplinary authority proceeded to
pass the order dated 22.8.2008 imposing penalty. Thereafter,
the petitioner has filed an appeal before the Appellate
Authority, who after duly considering the response of the
petitioner, so also the order dated 22.8.2008 did not interfere
with same. Further, proceedings under Regulation 49 of the
Regulations of 1960 was availed of by the petitioner and the
Chairman, after considering all the aspects, has passed the
order dated 6.4.2010 rejecting the memorial of the petitioner.
Therefore, when the petitioner was accorded sufficient
opportunity to defend his case, and after in-depth scrutiny, the
Inquiry Officer has submitted his report followed by passing of
the order dated 22.8.2008; further followed by passing of the
order dated 3.3.2009; and final order dated 6.4.2010, it cannot
C/SCA/16057/2011 JUDGMENT
be said that there is any infraction on the part of the
Corporation in conducting the disciplinary proceeding against
the petitioner. Therefore, in absence of any infraction pointed
out by the petitioner, this Court may not like to judicially
review the orders passed by the authorities because, the Court
would not like to sit in an appeal over the findings recorded by
the authorities below.
6.8 In support such contention, reliance is placed on the
judgment in the case of Apparel Export Promotion Council vs.
A.K. Chopra reported in (1999) 1 SCC 759. It is submitted that
the Apex Court has clearly held that judicial review, is not an
appeal from a decision, but a review of the manner in which
the decision is arrived at. The Court while exercising the power
of judicial review must remain conscious of the fact that if the
decision has been arrived at by the administrative authority
after following the principles established by law and the rules
of natural justice and the individual has received a fair
treatment to meet the case against him, the Court cannot
substitute its judgment for that of the administrative authority
on a matter which fell squarely within the sphere of jurisdiction
of that authority. It is, therefore, submitted that applying the
said principle to the facts of the present case, it cannot be said
that the principle established by law has not been followed.
Further, sufficient opportunity was afforded to the petitioner
and that there is no violation of rules of natural justice for, the
petitioner has received a fair treatment to meet his case.
Therefore, once all parameters of a fair and transparent inquiry
proceeding have been observed by the respondents, this Court
in exercise of its power under Article 226 of the Constitution of
India, may not like to interfere with.
C/SCA/16057/2011 JUDGMENT
6.9 While adverting to the quantum of punishment, it is
submitted that considering the misconduct committed by the
petitioner and the same having been sufficiently proved in the
inquiry proceeding, the penalty imposed is reasonable and in
proportion to the guilt of the petitioner. It is submitted that in
absence of there being any irregularity, illegality having been
pointed out by the petitioner, the decision under challenge as
well as penalty imposed, do not warrant interference.
6.10 Reliance is placed on the judgment in the case of
Praveen Bhatia vs Union of India & Ors. reported in (2009) 4
SCC 225. While referring to paragraph 13 of the judgment, it is
submitted that the Apex Court, has categorically held that the
power of the court to interfere with the quantum of
punishment is extremely restricted and only when the relevant
factors have not been considered that the Court can direct re-
consideration or in an appropriate case to certain litigation,
indicate the punishment to be awarded; and that can only be
in very rare cases. It is, therefore, submitted that the present
case, would not fall within the "rare cases" inasmuch as,
considering the scope and inquiry to be undertaken by the
development officer and he having failed in adhering to such
inquiry and the guilt having been established, the penalty of
withholding two increments permanently, is just and fair.
6.11 It is therefore, submitted that for the purpose of initiating
disciplinary proceeding against the petitioner and agent in
respect of the early death claim, the Corporation was obliged
to see the degree of discharge of duties with integrity and
devotion by the development officer and agent. It was
depending upon the aforesaid aspects that quantum of penalty
C/SCA/16057/2011 JUDGMENT
was decided by the Corporation to be imposed on the
development officer. The petitioner consistently having found,
by all the authorities, failing to maintain absolute integrity and
devotion of duty, acted in a manner detrimental to the interest
of the Corporation, was imposed penalty.
6.12 Under the circumstances, neither any error has been
committed by the authorities nor the orders passed by them
can be said to be illegal or arbitrary. Therefore, in view of the
settled proposition of law, this Court may not interfere with the
orders dated 22.8.2008, 3.3.2009 and 6.4.2010 passed by the
respective authorities, imposing penalty of withholding of two
increments with permanent effect. It is urged that the petition
is bereft of any merits and deserves to be rejected.
7. Heard the learned advocates for the respective parties
and perused the material available on record.
8. The issue revolves around the policies, one under "Jeevan
Tarang" and another under "Money Back Plan" of the
Corporation, bearing policy numbers 876549500 and
876549517 commencing from 15.7.2006 . The petitioner was
working as development officer of the Corporation and had
canvassed two proposals bearing nos. 1377 and 1379, both
dated 6.7.2006 for the sum of Rs.5 lakhs and Rs.2.5 lakhs,
respectively, on the life of one Smt. Pratiksha G Patel and after
personally visiting the life assured, the petitioner submitted
MHR describing the proposed assured eligible for insurance.
Considering the recommendation of the petitioner, finally
approved by the BMC, the Corporation undertook the risk on
the life of the proposed assured and effected the policies.
C/SCA/16057/2011 JUDGMENT
Within 14 days from the date of the commencement, a death
claim was received by the Corporation reporting that the
assured has expired on 29.7.2006 due to septicaemia at Maha
Gujarat Hospital, Nadiad.
9. The Corporation was of the view that the petitioner being
development officer, had an occasion to see the deceased
assured 2 to 3 times; however, the petitioner furnished false
information in MHR showing the deceased not having any
pregnancy. The aforesaid event led to the issuance of charge-
sheet dated 22.10.2007, which is reproduced here under for
ready reference:
"YOU, Shri G.K. Chauhan, development officer, S.R. No.436145,
Nadiad B.O.-1/846 under Nadiad Divisional Office are hereby
charged as under :
THAT, the proposal No.1377 and 1379 dated 06.07.2006 for
Rs.5,00,000/- and Rs. 2,50,000/- respectively on the life of Smt.
Pratikshaben Ghanshyambhai Patel was introduced by Shri B.S.
Sodha, Agent, Code No. 3850846 working under your
organization. Based on the ACR submitted by Shri B.S. Sodha,
Agent and MHR submitted by you, the proposals were accepted
and resulted into Policy bearing Nos.876549500 and 876549517
with Date of Commencement 15.07.2006.
THAT, the policyholder Smt. P.G. Patel expired on 29.07.2006 at
Maha Gujarat Hospital, Nadiad due to Septicemia within 14 days
from the date of commencement of the policies.
THAT, the deceased life assured was undergoing treatment from
Dr. Yogini N. Patel and the said doctor in her statement had
stated that Life Assured was 8 weeks pregnant as on
08.04.2006, which confirms that Life Assured was pregnant for
20 weeks as on the date of proposal.
THAT, though the life to be assured was having 20 weeks
pregnancy as on 06.07.2006, you have given your MHR under
both the policies without making independent inquiries and
without revealing the truth which could be quite visible.
THAT, by giving this MHR you have defrauded the Corporation by
accepting the risk on non-insurable life, which otherwise would
not have been accepted.
C/SCA/16057/2011 JUDGMENT
By your aforesaid acts, you failed to maintain absolute integrity
and devotion to duty, failed to serve the Corporation honestly
and faithfully, acted in a manner detrimental to the interest of
the Corporation and prejudicial to good conduct and thereby
committed breach of Regulations 21 and 24 read with
Regulations 39(1) of the Life Insurance Corporation of India
(Staff) Regulations, 1960, for which any one or more of the
penalties specified under Regulation 39 (1) (a) to (g) of the
aforesaid (Staff) Regulations, 1960 can be imposed on you.
HOWEVER, before I proceed further in the matter, you are
hereby directed to state in writing, within a period of ten days
from the date of receipt of this Charge Sheet as to whether or
not you plead guilty to the charges mentioned above. If you
admit the charges, a statement of admission and if not, a
statement of denial should be submitted to the undersigned
within ten days from the date of receipt of this Charge-sheet
together with a list of document/s by which as also a list of
witness/es through whom you would like to defend yourself.
Please note that if your written statement along with a list of
witnesses and documents as mentioned above is not received by
the undersigned within the period stipulated, or if your
statement of denial is not found to be satisfactory, further
proceedings in the matter shall ensue according to the Life
Insurance Corporation of India (Staff) Regulations, 1960 and
other standing instructions.
A provisional list of documents and witnesses by which charges
are sought to be sustained are annexed (vide Annexure 'A') to
the Charge Sheet."
10. Clearly, barring two recitals, rest of the recitals are
descriptions of the events. Actual charge is framed vide second
last recital, which states that though the life to be assured was
in the 20th. week of her pregnancy as on 6.7.2006, the
petitioner has given MHR under both the policies without
making independent inquiries and without revealing the truth,
which was quite visible. The last recital says that by giving
MHR, the petitioner has defrauded the Corporation by
accepting the risk on non-insurable life, which otherwise would
not have been accepted. Central to the charges levelled
against the petitioner is filling up MHR by the petitioner.
11. This court with a view to verifying the process of
C/SCA/16057/2011 JUDGMENT
submitting proposal form, requested the learned advocate for
the Corporation to provide the details and he was kind enough
to clarify the process. What emerges is that the process for
taking insurance starts with filling up a proposal form by the
agent, that is Agent's Confidential Report, which is signed by
the party, the agent concerned and the Panel doctor. The
report is also accompanied by a Medical Examiner's
Confidential Report to be filled in by the medical examiner,
who is the panel doctor of the Corporation and thereafter, the
role of the development officer comes. The development
officer, after verifying the credentials of the life assured, offers
his recommendation/opinion, that is, MHR. The proposal then is
inwarded to the New Business Department/branch through the
administrative officer. The same is thereafter placed before the
BMC, consisting of four members, namely, the branch manager
and other three members, for its final approval. Hence, the
issue involved in the present petition is to be decided keeping
in the forefront the aforesaid procedure.
12. Clearly , what emerges from the aforesaid process, is that
the petitioner is not the sole and final authority to sanction the
policies. Notably, proposal form, in vernacular and placed on
the record, contains several columns. Column no.13(A)
pertains to the details, as to whether the life assured is
pregnant or not. The details recorded in all the other columns
are "no" and in the last column, there is a remark about the
last menstruation date, as 1.7.2006. The proposal, at the end,
carries the signature of the medical examiner, which reads
thus:
"I certify that the Life Assured has signed/put his/her thumb
impression in my presence after (illegible) that all the answers to
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Questions No. 10 to 13 (both inclusive) of the proposal form have
been correctly recorded".
Further, the said proposal is accompanied by a Medical
Examiner's Confidential Report, which, in detail, records the
medical history of the life assured. Column no.14, pertains to
"for female only" with three queries to be answered, namely,
(a) is there any disease of breasts, (b) do you suspect any
disease of uterus, cervix or ovaries and (c) is there any
evidence of pregnancy, if so, give duration. The remark put
forth by the doctor against the said Column is "no". At the end
of the certificate, there is an endorsement, which reads thus:
"I hereby certify that I have, this day, examined the above life to
be assured personally, in private, and recorded in my own hand
(i) the true and correct findings (ii) the answers to Question No. 5
as ascertained from the person examined."
13. The said proposal form is also signed by the Dr Janki
Amin, Gynaecologist. Therefore, Dr Amin, who was the panel
doctor of the Corporation had examined the life assured and
ultimately, given her report that the life assured is not having
any pregnancy as on 6.7.2006. Moreover, Dr Janki Amin, during
the inquiry in connection with the policies was also asked to
furnish her explanation, which she did vide communication
dated 6.2.2007 specifically stating that the party was not
carrying any pregnancy on the date of the medical
examination. The extracts of the letter dated 6.2.2007, are
reproduced herein below for ready reference:
"In respect of with ref. to your letter dated 12/1/07, I inform you
that the party had come to me for medical examination. I had
asked on 6.7.06. During examination I had asked all the relevant
questions to the party and the same were recorded in the
medical report. I had specifically asked the medical report. I had
specifically asked the party her last menstrual date which was
recorded on 01-07-06. Also the party was introduced to me by
the above agent and his signature is taken in my diary and
C/SCA/16057/2011 JUDGMENT
medical form. I hereby specifically wish to mention that the party
was not having pregnancy on the date of medical examination
after having her completely examined."
14. Therefore, the panel doctor of the Corporation having
thoroughly examined the proposed life to be assured, had
opined that the life assured was not pregnant and once the
doctor had certified in her report, there was no reason
available to the petitioner to have gone for further
independent inquiry. At the most, the obligation of the
petitioner was to refer the party to the panel doctor, which he
did. Therefore, once the gynaecologist had opined about the
life assured not caring pregnancy, the petitioner or for that
matter any prudent man would not doubt the opinion of the
doctor so also the status of the pregnancy. The said proposal
forms were thereafter placed before the BMC through the
administrative officer, the BMC, comprising four members, also
accepted the recommendations and approved the policies
without raising any objection or queries or referring the matter
back to the petitioner for further inquiry.
15. Adverting to the nature and scope of inquiry by the
petitioner, pertinently, there is nothing on record, placed
before the authorities or before this court to substantiate that
it was the bounden duty of the petitioner to have examined the
life assured or for that matter given his report on the basis of
physical appearance of the life assured about her pregnancy.
Under the circumstances, it is difficult to fathom as to how it
was the obligation of the petitioner to have verified the truth of
pregnancy through physical appearance of the life assured.
Therefore, in absence of any evidence, it is difficult to
understand as to and on what basis the inquiry officer had
come to the conclusion that the petitioner had given MHR
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without making independent inquiries and without revealing
the truth, which would have been quite visible. Notably, the
inquiry officer had not even taken note of the Medical
Examiner's Confidential Report which was accompanied with
the proposal forms indicating about the health status of the life
assured and placed before the BMC and on the basis of which ,
the BMC had approved the insurance in favour of the life
assured.
16. Quite apart, Dr Janki Amin was also asked to furnish an
explanation and which she did vide letter dated 6.4.2007, the
same was forwarded to the Divisional Medical Referee for his
recommendation; however, he recommended that during
personal examination, Dr Janki Amin has probably missed the
pregnancy and therefore, she has been misguided by the party
and partly she is responsible for medical examination. The
Divisional Medical Referee suggested to give her benefit of
doubt, however, he left the final decision to be taken by the
Corporation. Though the final decision was left to the
Corporation, it accepted the recommendation of the Divisional
Medical Referee, and took a decision of giving benefit of doubt
to Dr Amin.
17. Further, before issuing policies by the Nadia division,
policy was issued by Anand division as well in similar set of
facts and in the name of very same life assured. In the said
policy also, the proposal form was filled in and the life assured
was examined by the concerned medical examiner, who had
also not given any indication about the pregnancy of the life
assured. Further, the development officer Mr. P.H.Soni of Anand
division was also asked to explain as to why the policy has
C/SCA/16057/2011 JUDGMENT
been issued without properly verifying the credentials of the
life assured. Mr. P.H.Soni vide explanation dated 28.1.2007,
indicated that as per doctors opinion, there was no symptoms
of pregnancy and it might have happened that the husband of
the life assured must have got another lady examined. Though
the Corporation did not find the explanation satisfactory,
considering the gravity of the lapse, strict warning to be
careful in future, came to be issued to Mr P.H.Soni. Therefore,
so far as Mr. Soni is concerned, the Corporation was satisfied
by giving strict warning to him to be more careful in future.
18. Therefore, so far as Dr Janaki Amin, who was a panel
doctor and has given medical report as well as Mr P.H. Soni,
development officer working with the Anand division, are
concerned, were not subjected to any inquiry proceedings, and
were given benefit of doubt and strict warning, respectively.
Therefore, the learned advocate for the petitioner is right in
contending that the petitioner was subject to discrimination
and the action of the Corporation was in violation of article 14
of the Constitution of India inasmuch as, for the very same
lapse and with equal participation of the officers, they have
been given either benefit of doubt or strict warning, whereas,
the petitioner was the only officer who has been charge-
sheeted on the ground that he has filled in MHR without proper
and independent inquiry. Therefore, the action on the part of
the Corporation in initiating proceeding against the petitioner,
being clearly discriminatory, warrants interference by this
court.
19. So far as inquiry proceeding initiated by the Corporation
is concerned, this court is mindful of the jurisdiction conferred
C/SCA/16057/2011 JUDGMENT
upon it under Articles 226 and 227 of the Constitution of India;
however, when it is pointed out that the case is of no evidence
or that illegality has been committed by the employer, the
court would certainly step in. The learned counsel for the
Corporation has placed heavy reliance on the judgement in the
case of Apparel Export Promotion Council (supra) to contend
that the Court while exercising the power of judicial review
must remain conscious of the fact that if the decision has been
arrived at by the administrative authority after following the
principles established by law and the rules of natural justice
and individual has received a fair treatment to meet the case
against him, the court cannot substitute its judgement for that
of the administrative authority on a matter which fell squarely
within the sphere of jurisdiction of that authority. There is no
quibble over the proposition; however, it is equally well settled
that if the court finds that the recorded findings are based,
either on no evidence or that the findings were wholly perverse
and/or legally untenable, it will be very much available to the
court to exercise its powers under article 226 of the
Constitution of India.
20. The inquiry proceeding so also the orders passed by the
authorities concerned, are perverse and illegal, for the facts
and reasons discussed hereinabove as well as for the
discussion stated hereinafter.
21. The enquiry proceeding initiated by the inquiry officer,
started on 3.1.2008 and concluded on 13.3.2008. During the
inquiry proceeding, the petitioner/assisting employee
addressed a communication dated 24.1.2008 requesting for
following documents: -
C/SCA/16057/2011 JUDGMENT
"(1) From the docket of policy number 876549500 and
876549517
(a) Extract of policy No.877150903
(b) Photocopy of review slip of proposal Nos.1377 and
1379 (both page) having decision notes.
(2) From the docket of policy No.877150903 (BO 1/845,
Anand).
(a) Photocopy of proposal forms
(b) Photocopy of FMR
(c) Photocopy of ACR-MHR by D.O.
(3) All photocopies of action taken report in respect of policy
No.877150903 (B.O. 1/845/Anand)
(4) Photocopy of BMC register (B.O. 1/846 NAD)
Page regarding decision of the proposal Nos.1377 to
1379 including names and signature of the members of
BMC."
22. Vide letter dated 11.2.2008, an assisting employee was
provided only the photocopy of the review slips of proposal
nos. 1377 and 1379, having decision notes of the branch
officials. So far as the other documents were concerned, which
were relatable and connected to the policies, namely, the
photocopy of the proposal forms, photocopy of FMR,
photocopies of Agent's Confidential Report, MHR by
development officer and the action taken report in respect of
the policy no. 877150903 of Anand division were not provided,
informing the assisting employee that the Corporation is of the
opinion that the request of the petitioner cannot be acceded to
as the documents are not relevant to the disciplinary case.
Except saying that the documents are not relevant, it has not
been stated as to why the documents demanded by the
petitioner were not relevant. Therefore, the assisting employee
while placing reliance on the regulation no.2(C) urged that the
documents submitted are not sufficient to submit the final
arguments and non-supply of the required documents, would
C/SCA/16057/2011 JUDGMENT
be in violation of principles of natural justice. The inquiry
officer without dealing with the said aspect proceeded to
conclude the hearing on 13.3.2008. Therefore, such conduct on
the part of the inquiry officer, was not in confirmity with the
principles of natural justice.
23. While adverting to the aspect of non-production of the
witnesses, the petitioner placed reliance on clause 2(D) of
chapter IX titled "Summoning of witnesses" which reads as
under: -
"D. Summoning of witnesses :
An Enquiry Officer appointed to hold the enquiry should
write to the witnesses proposed to be produced on behalf of the
management and on behalf of the accused employee to present
themselves before him on the specified date. While he has no
power to compel attendance of witnesses, it is his duty to take
all necessary steps to secure attendance of the witnesses on
both sides. In case a witness being the employee of the
Corporation, is in the control of the disciplinary authority, the
Enquiry Officer should write to the disciplinary authority
requesting that the witnesses should be asked to present himself
before the Enquiry Officer on the date fixed for the purpose. It is,
however, within the discretion of the Enquiry Officer for reasons
to be recorded by him in writing, to refuse to call witnesses
whom the person charged has asked to be summoned.
Ordinarily, the request may not be refused unless it is vexatious
or made with a view to prolonging the proceedings or delaying
the enquiry unnecessarily, e.g. when the request is to call an
employee who has no knowledge of the facts relating to any of
the charges and the request is made merely to trouble or cause
inconvenience to that employee. The Enquiry Officer in a case
must take upon himself the role of a witness in addition to his
own role as an Enquiry Officer."
24. The said clause confers a duty upon an enquiry officer to
take necessary steps to secure the attendance of the
witnesses on both sides. It also provides that in case witnesses
being the employee of the Corporation and is in control of the
disciplinary authority, the inquiry officer should write to the
said authority requesting the witnesses to be asked to present
C/SCA/16057/2011 JUDGMENT
before the inquiry officer. It also provides that it would be the
discretion of the inquiry officer, for the reasons to be recorded
in writing, to refuse to call witnesses whom the person charged
has asked to be summoned and ordinarily, the request may not
be refused unless it is vexatious or made with a view to
prolonging the proceedings or delaying the inquiry
unnecessarily. Clearly, and not disputed though there was a
request by the assisting employee for production of the
witnesses, the witnesses did not remain present. In such
eventuality, it was expected of the inquiry officer to have taken
all the necessary steps to secure the attendance of the
witnesses; however, there is not a semblance of any effort put
by the inquiry officer, in conformity with clause 2(D) of chapter
IX of the guidelines. Therefore, such action on the part of the
inquiry officer was in violation of principles of natural justice.
25. Moreover, at the end of the inquiry proceeding, remarks
of the presenting officer were called for and which were
received by the inquiry officer on 16.3.2008 and were provided
to the petitioner who offered his remarks vide communication
dated 27.3.2008. The inquiry officer even at that stage did not
deem it proper to deal with the said aspect of non-production
of documents as well as non-summoning of the witnesses. The
report of the inquiry officer, after recording brief facts has held
that on the strength of the proposal form and MHR submitted
by the petitioner, the corporation accepted the risk which
would not have been accepted otherwise by the Corporation.
Therefore, the petitioner has committed misconduct by not
giving proper information in the MHR and more particularly the
status of the life assured being in her 20 th week of pregnancy
as on 6.7.2006. The inquiry officer has further held that the
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misconduct of the petitioner is proved and that the petitioner
has defrauded the Corporation by accepting the risk of a non-
insurable life, which otherwise would not have been accepted.
26. The inquiry report dated 16.4.2008 by the Inquiry Officer,
is reproduced hereunder for ready reference:-
With reference to the above, chargesheet dated 22-10-2007 was
given to Shri G K Chuahan Dev Officer SR No 436145 Nadiad BO-
l. Subsequently disciplinary proceedings were initiated against
him and vide officer dated 17-11-2007 I was appointed as
enquiry officer and Shri K P Chauhan was appointed as PO on
belalf of the management.
Shri AG Shaikh Dev Officer was permitted permitted to act as
assisting employee.
I had conducted the enquiry proceedings on 09-01-2008, 17-01-
2008, 21-01-2008, 24-01-2008, . 13-02-2008, 21-02-2008 and
13-3-2008. During the proceedings Shri A.G Shaikh was Assisting
employee of Shri G.K.Chauhan. CSE and Shri K P Chauhan was
P.O. on behalf of the management.
During the course of enquiry proceeding Shri G.K.Chauhan, Dev
officer, the CSE admitted that he met the deceased policyholder
2 to 3 times during the process of canvassing the proposal on
the life of deceased policyholder Smt Pratikshaben
Ghanshyambhai Patel. The CSE also admitted that proposal on
the proposal form was signed by the deceased life assured. Shri
G.K.Chauhan had also signed MHR of the proposal form which
was based on the agent's report.
The policyholder smt Pratikshaben Patel expired on 29-07-2006
at Maha Gujarat Hospital Nadiad due to septicemia i.e. within I4
days from the commencement of the risk.
It was revealed that the deceased life assured was taking
treatment from Dr. Yogini N patel, whose statement reveals that
the life assured was having pregnancy of 8 weeks as on 08-04-
2008, which confirms that the life assured was pregnant for 20
weeks as on the date of proposal.
It is the duty of a development officer to submit is MHR after
making independent inquiries. During the inqiury proceedings,
Shri Chauhan admitted that he studied the proposal form and
after meeting 2 to 3 times he submitted his MHR.
Though the life assured was having pregnancy of 20 weeks, CSE
shri G.K.Chauhan failed to give such information in his MHR.
C/SCA/16057/2011 JUDGMENT
Pregnancy of 20 weeks can be easily visible, which he has not
mentioned in his report.
On the strength of the proposal form and MHR submitted by CSE,
corporation accepted the risk. If the said facts were clearly
mentioned, the risk would not have been accepted by the
corporation.
In what has been stated above it is proved that
(1) Though the life assured was having 20 weeks pregnancy
as on 06-07-06, CSE had given MHR without
making independent inquiries and without revealing the
truth which could he quite visible.
(2) By giving this MHR CSE has defrauded the corporation by
accepting the risk on non insurable life, which otherwise
would not have been accepted."
27. Clearly, the inquiry officer has recorded the aspect of the
statement of Dr Yogini Patel revealing the fact that the life
assured was having a pregnancy of 20 weeks. Perceptibly, the
presenting officer as well as inquiry officer have placed heavy
reliance on the statement of Dr Yogini Patel, who was treating
the life assured; however, they have not touch the Medical
Examiner's Confidential Report prepared by the panel doctor,
who in no uncertain terms, had declared that the life assured
had no evidence of any pregnancy. Therefore, consideration of
relevant material was missed and irrelevant aspect weighed
with the inquiry officer for holding the petitioner guilty of the
misconduct. Therefore, the aforesaid findings recorded by the
inquiry officer, which can hardly be said to be the findings, are
erroneous, without any basis and tainted with illegality.
28. Upon receipt of the enquiry report, the petitioner vide
letter dated 24.4.2008 addressed to the respondent no.3,
raised the grievance about non-supply of the documents so
also non-examination of the witnesses during the inquiry
proceeding. Instead of dealing with the said aspect, the
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respondent no.3 had issued a notice dated 21.6.2008
intimating the petitioner that he has been provisionally held
guilty of all the charges and as to why the penalty of
withholding of two increments permanently in the pay scale
applicable to him shall not be imposed. The respondent no.3
while dealing with the grounds, held that the same are not
correct inasmuch as, the photocopies of the documents related
to the case under the policy numbers 876549500 and
876549517 have been provided with the letter dated
11.2.2008. The respondent no.3 went wrong for, such
observations were erroneous because the assisting employee
on behalf of the petitioner had asked for various documents
and not only the documents namely photocopies of policies as
referred to by the respondents no.3. Similarly, the aspect of
non-examination of the witnesses has also not been properly
considered and the respondent no.3 was satisfied by observing
that ample opportunity was given to the petitioner to defend
his case but the petitioner could not produce any witnesses;
however, what has been lost sight of by the respondent no. 3 ,
was the duty cast upon the inquiry officer to act in conformity
with sub- clause (D) of Clause 2 of chapter IX of the guidelines,
which he failed to observe. Therefore, the error committed by
the inquiry officer continued by the respondent no.3, that is,
the disciplinary authority, as well.
29. The petitioner, submitted his reply dated 14.7.2008
reiterating all the contentions. However, the respondent No.3
proceeded to pass the order dated 22.8.2008 imposing penalty
of withholding of two increments permanently in the pay scale
applicable to him in terms of Regulation 39(1)(b) of the
Regulations of 1960.
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30. The petitioner, being aggrieved, preferred an appeal
before the respondent No.2, who also in a brief order, rejected
all the contentions raised by the petitioner without
appreciating the material available on record. The contentions
and the grounds raised by the petitioner have been dealt with
in a very broad manner, without recording any reasons for not
accepting the said contentions. The observations by the
Appellate Authority, though it was open to him to have
appreciated the evidence, he chose not to do so and in an
abrupt manner, rejected the appeal of the petitioner vide order
dated 31.3.2009. Similarly, the respondent No.1 - Chairman,
has rejected the memorial filed by the petitioner in a slipshod
manner, without properly dealing with the contentions raised
by the petitioner.
31. In this behalf the judgment of the Apex Court is worth
referring to. The Apex Court, in the case of Kranti Associates
Private Limited and Another vs. Masood Ahmed Khan and
Others reported in (2010) 9 SCC 496, has emphasised the
aspect of necessity of giving reasons by a body or authority in
support of its decision. It is well settled proposition of law that
recording of reasons also operates as a valid restraint on any
possible arbitrary exercise of judicial and quasi-judicial or even
administrative power. Reasons reassure that the discretion has
been exercised by the decision-maker on relevant grounds and
by disregarding extraneous considerations. The reasons have
virtually become as indispensable a component of a decision-
making process, observing principles of natural justice by
judicial, quasi-judicial and even by administrative bodies. The
reasons facilitate the process of judicial review by superior
C/SCA/16057/2011 JUDGMENT
Courts. The Apex Court has further observed that since the
requirement to record reasons emanates from the broad
doctrine of fairness in decision making, the said requirement is
now virtually a component of human rights.
32. While concluding and at the cost of repetition, it is
required to be noted that sanctioning of the policies was not
within the exclusive domain of the petitioner and was a
process of collective decision. The material available on record
clearly suggests that there was no case against the petitioner
and the inquiry officer wrongly held charges to be proved.
Under the circumstances and as discussed in the preceding
paragraphs, the inquiry was conducted in a slipshod manner,
against the principles of natural justice and all canons of fair
play were grievously violated. Relevant considerations have
been discarded and irrelevant considerations weighed with all
the authorities of the Corporation. Therefore, on all the counts,
the orders dated 22.8.2008, 31.3.2009 and 6.4.2010, deserve
to be quashed and set aside and are hereby quashed and set
aside.
33. Accordingly, the petition is allowed. The respondents are
directed to extend all the consequential benefits to the
petitioner within a period of eight weeks, from the date of the
receipt of this judgment.
34. Rule is made absolute. No order as to costs.
(SANGEETA K. VISHEN,J)
BINOY B PILLAI
