Prasant Kumar Patnaik vs State Of Odisha And Another ... Opposite ...
2024 Latest Caselaw 3908 Ori

Orissa High Court

Prasant Kumar Patnaik vs State Of Odisha And Another ... Opposite ... on 1 March, 2024

Author: A.K. Mohapatra

Bench: A.K. Mohapatra

              HIGH COURT OF ORISSA: CUTTACK

                        W.P.(C) No.35746 of 2023
   In the matter of an application under Articles 226 and 227 of the
   Constitution of India.


                                   -----------

   Prasant Kumar Patnaik                           ...       Petitioner

                                    - Versus -

   State of Odisha and another                     ... Opposite parties


       For Petitioner                ...      Mr. Subir Palit,
                                            Senior Advocate

                                            M/s. Venugopal Mohapatra,
                                            S. Sahoo & A. Tripathy.
       For Opposite Parties   ...             Mr. Saswat Das
                                            Additional Government Advocate



                                  --------------

   PRESENT:

THE HONOURABLE SHRI JUSTICE A.K. MOHAPATRA Date of hearing : 19.02.2024 : Date of judgment : 01.03.2024

A.K. Mohapatra, J. The above named Petitioner, who is a

retired Government employee, has filed the present writ

petition questioning the validity and propriety of order dated // 2 //

13.10.2023 passed by the Opposite Party No.1 thereby

rejecting the representation of the Petitioner dated 18.05.2023

and 03.08.2023 filed with a prayer for sanction and

disbursement of final pension, gratuity and unutilized leave

salary along with interest @ 18% from the date of retirement

of the Petitioner. The Petitioner while praying for quashing of

order dated 13.10.2023 under Annexure-8 to the writ petition

has also prayed for issuance of a writ of mandamus thereby

directing the Opposite Party No.1 to sanction and disburse

the final pension and gratuity as is due and admissible to the

Petitioner along with interest @ 18%.

2. The present writ petition was filed on 31.10.2023.

While taking up this matter for admission and while issuing

notice vide order dated 07.11.2023, this Court, vide interim

order dated 07.11.2023 passed in I.A. No.17282 of 2023,

disposed of the said I.A. by directing the Opposite Party to

disburse the unutilized leave salary to the Petitioner along

with interest @ 18% as claimed by the Petitioner within a // 3 //

period of six weeks from the date of communication of such

order. Therefore, the prayer made in the writ petition with

regard to payment of unutilized leave salary no more

survives.

3. The factual background leading to filing of the present

writ petition by the above named Petitioner, in short, is that

the Petitioner initially joined as Assistant Town Planner

under the department of Housing and Urban Development,

Government of Odisha, in the year 1987 on being duly

selected. Thereafter, the Petitioner continued to work under

the said department and discharged his duties to the

satisfaction of the authorities. While the Petitioner was in

service, an F.I.R. bearing Cuttack Vigilance P.S. Case No.84

of 2012 was registered on 28.12.2012 for commission of

offence under Section 13(2) read with 13(1)(b) of the

Prevention of Corruption Act, 1988 and Section 420/120(B)

of I.P.C. In the vigilance case, the Petitioner has been

implicated as an accused. While the vigilance case was // 4 //

continuing, the Petitioner has retired from service w.e.f.

31.05.2013 on attaining the age of superannuation.

4. The averments made in the writ petition further reveals

that on the date of retirement of the Petitioner from service on

31.05.2013, no disciplinary proceeding, as well as any

judicial/criminal proceeding were pending against the

Petitioner. However, the authorities did not sanction and

disburse the financial benefits as well as the pensionary

benefits as is due and admissible to the Petitioner on his

retirement. Being aggrieved by such conduct of the Opposite

Parties, the Petitioner wrote an e-mail on 01.07.2020 to the

Opposite Party No.1 with a specific request to sanction his

final pension along with gratuity and other retirement

benefits.

5. The writ petition further reveals that the F.I.R. in

Cuttack Vigilance P.S. Case No.84 of 2012 implicating the

present Petitioner as an accused was challenged by the

Petitioner before this Court by filing an application under // 5 //

Section 482 of the Cr.P.C. which was registered as CRLMC

No.704 of 2019. After hearing the counsels appearing for the

parties, a coordinate Bench, vide a detailed judgment dated

13.04.2022 under Annexue-2, to the writ petition allowed the

CRLMC application. Accordingly, the F.I.R. in Cuttack

Vigilance P.S. Case along with consequential proceeding in

VGR P.S. Case No.84 of 2012 pending in the Court of

Special Judge, Cuttack, qua the present Petitioner was

quashed. Therefore, the judicial/criminal proceeding, which

was pending against the present Petitioner, has come to an

end by virtue of the judgment dated 13.04.2022 under

Annexure-2 to the writ petition.

6. Being aggrieved by the non-consideration of his

representation, the Petitioner approached this Court by filing

W.P.(C) No.14462 of 2023 with a prayer for a direction to

the Opposite Party No.1 to consider his representation dated

01.07.2020. This Court disposed the said writ petition with a

direction to the Opposite Party No.1 to dispose of the // 6 //

representation of the Petitioner dated 01.07.2020 by passing a

reasoned order and to pay the retirement benefits to the

Petitioner along with interest vide order dated 09.05.2023

under Annexure-4 to the writ petition. While disposing of the

said writ petition, this Court has categorically directed that in

the event the Opposite Parties come to a conclusion that the

Petitioner is entitled to the dues as has been claimed by him,

the same shall be sanctioned in favour of the Petitioner within

a period of four weeks along with interest at such rate as has

been directed by the Hon'ble Supreme Court in the case of

D.D. Tiwari (D) through LRs v. Uttar Haryana Bijli Bitaran

Nigam, reported in (2014) 8 SCC 894.

7. After disposal of the above noted writ petition, the

Petitioner had approached the Opposite Party No.1 by filing a

fresh representation dated 18.05.2023 under Annexure-5 to

the writ petition along with a copy of the order passed by this

Court on 09.05.2023. The Opposite Party No.1 pursuant to

the order passed in the previous writ petition on 09.05.2023 // 7 //

considered the case of the Petitioner and, accordingly, the

representation of the Petitioner dated 18.05.2023 has been

disposed of by a detailed and speaking order dated

13.10.2023 under Annexure-8 to the writ petition. While

disposing of the representation of the Petitioner as directed by

this Court, the Opposite Party No.1 in his order dated

13.10.2023 has stated that on the basis of the local fund audit

report, a sum of R.7,97,817/- is required to be recovered from

the Petitioner as per the observation made in the audit report.

Moreover, since the amount which has been shown

recoverable exceeds the amount due towards gratuity,

therefore, the Opposite Party No.1 has not sanctioned the

final pension and other retiral benefits as is due and

admissible to the Petitioner. Furthermore, since the matter

involves recovery of public money, the Finance Department,

in the meantime, has been requested to expedite final

decisions on the Audit paras and suggested audit recoveries

to enable the Opposite Party No.1 to sanction the final // 8 //

pension and retirement benefits in favour of the Petitioner.

With such observation, the representation of the Petitioner

was disposed of.

8. While the matter stood thus, on 18.10.2023, a surcharge

order was passed by the Examiner of Local Accounts under

Odisha Local Fund Audit Act, 1948 whereunder the

Petitioner has been asked to deposit a sum of Rs.6,54,104/-

within a period of fourteen days from the date of that order

under Annexure-12 to the writ petition.

9. Learned Senior Counsel appearing on behalf of the

Petitioner submitted that the aforesaid order dated 18.10.2023

under Annexure-12 has been assailed by the Petitioner by

filing an appeal under Section 11 of the Odisha Local Fund

Audit Act, 1948, which is still pending for final

consideration.

10. A counter affidavit has been filed on behalf of the

Opposite Party No.1 wherein it has been stated that the // 9 //

Petitioner has retired from service on attaining the age of

superannuation on 31.05.2013. Thereafter, provisional

pension has been sanctioned vide order dated 19.06.2013 in

favour of the Petitioner, which was subsequently revised vide

order dated 17.09.2019. Further, it has been stated that the

representation of the Petitioner which was directed to be

considered by this Court vide order dated 09.05.2023 in

W.P.(C) No.14462 of 2023 has been duly considered on the

basis of the documents available on record and, accordingly,

the same has been disposed of by passing a speaking and

reasoned order on 13.10.2023 under Annexure-8 to the writ

petition. The Opposite Parties have also admitted that the

Vigilance F.I.R. lodged against the Petitioner has been

quashed by this Court in CRLMC No.740 of 2019 on

13.04.2022.

11. The counter affidavit of Opposite Party No.1 further

reveals the Examiner of Local Accounts, Directorate of Local

Fund Audit, Odisha has intimated the Opposite Party No.1 // 10 //

for recovery of R.7,97,817/- from the Petitioner in respect of

observation made in Audit Report No.42/07/08 and

No.61/10-12 pertaining to Puri-Konark Development

Authority. Accordingly, the aforesaid issue has been referred

to the Finance Department with a request to finalize the Audit

Report expeditiously. It has also been stated in the counter

affidavit that claim of the Petitioner has not been totally

rejected, however, steps have been taken to finalize the retiral

benefit of the Petitioner at the earliest. On such ground, it has

been stated in the counter affidavit that such order under

Annexure-8 does not cause any prejudice to the Petitioner.

12. The counter affidavit further reveals that the delay in

sanction and disbursal of the retiral benefits as well as final

pension is due to the pendency of the Vigilance Case against

the Petitioner, although the same was quashed subsequently

by this Court vide order dated 13.04.2022. Moreover,

Bhubaneswar Vigilance P.S. Case No.7 dated 08.03.2009

was initiated against the Petitioner for demand of an illegal // 11 //

gratification of Rs.3,000/-. Despite several communications

being sent to the G.A. (Vigilance) Department, no reply was

received. However, the G.A. (Vigilance) Department, vide

letter dated 29.08.2023, intimated the Opposite Party No.1

that Bhubaneswar Vigilance P.S. Case No.7 of 2009 may be

treated as closed. A copy of the letter containing the aforesaid

intimation dated 29.08.2023 has also been annexed to the

counter affidavit.

13. Finally, the Joint Director, Directorate of Local Fund

Audit vide his letter dated 02.11.2023 intimated that a sum of

Rs.6,54,104/- was surcharged against the Petitioner under

Section 9(3) of OLFA Act, 1948 relating to the observation in

the Audit Report. Although they have specifically admitted

that such order has been appealed against by the Petitioner.

Since the aforesaid surcharge amount is public money,

therefore, the Opposite Party No.1 has assumed that the

money due to the development authority is Government

money as the development authorities are autonomous bodies // 12 //

created by the Government under a special statute. Finally, a

stand has been taken in the counter affidavit that the pension

amount of the Petitioner has been sanctioned and his pension

papers have been forwarded to Accountant General (A&E),

Odisha, Bhubaneswar vide letter dated 28.11.2023 and that

the unutilized leave salary of the Petitioner has already been

sanctioned by the Opposite Party No.1 vide order dated

06.12.2023 with an intimation to withhold the surcharged

amount of Rs.6,54,104/- till finalization of Audit Report.

14. Heard Mr. S. Palit, learned Senior Counsel appearing

for the Petitioner along with Mr. Venugopal Mahapatra,

learned counsel, appearing for the Petitioner; and Mr. Saswat

Das, learned Additional Government Advocate appearing for

the State-Opposite Parties. Perused the pleadings of the

respective parties and the materials on record.

15. Mr. S. Palit, learned Senior Counsel appearing for the

Petitioner, at the outset, submitted that the pertinent issue

which is required to be decided by this Court in the present // 13 //

writ petition is whether on the ground of surcharge order, the

pensionary and retirement benefits as is due to a retired

Government servant can be withheld under the provisions of

the OCS (Pension) Rules, 1992. In course of his argument,

Mr. Palit, referring to the provisions contained in Rule-7(1)

of the OCS (Pension) Rules, 1992, submitted that such rule

permits the State Government to withhold pension or gratuity

and the State Government may order recovery of any

pecuniary loss caused to the Government only after it has

been ascertained in a disciplinary or judicial proceeding that

the Petitioner is guilty of grave misconduct. In the present

case, no disciplinary proceeding having been initiated against

the Petitioner and the FIR in the Vigilance Case having

already been quashed by a coordinate Bench of this Court,

the State-Opposite Parties cannot withhold the gratitude as is

due and admissible to the Petitioner. In the aforesaid context,

learned Senior Counsel appearing for the Petitioner referred

to the judgment of the Hon'ble Supreme Court in the case of // 14 //

D.V. Kapoor v. UOI and Others, reported in (1990) 4 SCC

314. He specifically placed reliance on para-4, 8, 9 and 10 of

the said judgment.

16. In course of his argument, learned Senior Counsel

appearing for the Petitioner also specifically referred to the

circular of the Government of Odisha dated 27.08.1991,

which has been annexed to the writ petition as Annexure-9.

For better appreciation of the issue and the decision of the

Government under the aforesaid circular, this Court deems it

proper to extract the entire circular herein below:-

"No.Pen. 44/91-31740/F., Government of Orissa, Finance Department OFFICE MEMORANDUM Recovery of dues arising out of non-settlement of audit objections. While taking up pension case in the pension Adalat for finalization it has come to the notice that in some cases D.C.R. Gratuity etc. have been held up pending settlement of audit objections. It has to be borne in mind that the findings in an audit report/para do not impose any liability on the Government servant concerned unless the same is // 15 //

established in Departmental proceedings initiated against him under the Orissa Civil Service classification, control and Appeal) Rules, 1962. Such liability does not come under the purview of Government dues. It is mandatory that Government dues are required to be cleared by the retiring Government servant before the date of his retirement. The existing provisions of Rule 157 and 158 of the O.P.R. 1977 do not define the term of Govt. dues. The expression "Government dues"

includes only arrears of rent and other charges pertaining to occupation of Govt. accommodation, balance of house building or conveyance advance, over-payment of pay and allowances or leave salary and arrears of Income Tax deductible at source under the Income Tax Act, 1961.

As such the amount arising out of Audit report/para which has not been termed as "Government dues" can not be recovered from D.C.R. Gratuity. Such dues can, however, be realized provided the responsibility is fixed by following the appropriate procedure.

Sd/-S.K. Rath, Joint Secy. to Government Memo No.31741/F., dt. 22.8.91.

Copy forwarded to all Departments of Govt./all Heads of Departments. Xxx xxx for information and necessary action.

Sd/-S.K. Rath, Section Officer"

// 16 //

17. Referring to the aforesaid circular, learned Senior

Counsel appearing for the Petitioner further emphatically

submitted that the Finance Department, Government of

Odisha, has stipulated that the findings in an audit report/para

do not impose any liability on the concerned Government

servant unless, the same is established in a departmental

proceedings initiated against the delinquent officer under the

Orissa Civil Service (CCA) Rules, 1962 and that such

liability does not come under the purview of Government

dues. He further contended that the said circular provides that

the expression "Government dues" includes only arrears of

rent and other charges pertaining to occupation of Govt.

accommodation, balance of house building or conveyance

advance, over payment of pay and allowances or leave salary

and arrears of Income Tax deductible at source under the

Income Tax Act, 1961. Therefore, the aforesaid circular

clearly provides that the liability arising out of audit

report/para cannot be considered as Government dues and, // 17 //

accordingly, the same cannot be recovered from D.C.R.,

Gratuity as Government dues. Further, such circular specifies

that such dues, nevertheless, can be realized provided the

responsibility is fixed by following the procedure. In such

view of the matter, learned Senior Counsel appearing for the

Petitioner submitted that the aforesaid dues by no stretch of

imagination can be construed as Government dues. Hence,

the gratuity of the Petitioner could not have been withheld by

the Opposite Party No.1.

18. Learned Senior Counsel also relied upon the ratio laid

down by a coordinate Bench of this Court in Duryodhan

Nayak v. State of Odisha and Others (W.P.(C) No.2098 of

2013 disposed of vide judgment dated 01.03.2023). On a

careful reading of the aforesaid judgment in Duryodhan

Nayak's case (supra), this Court observes that a coordinate

Bench of this Court by referring to the judgment passed by

this Court in Manoranjan Khadenga v. Chairman, Orissa

Forest Development Corporation Ltd., Bhubaneswar, // 18 //

Khurda and others, reported in 2016(1) OLR-651, has come

to a finding that the withholding of retirement benefits along

with gratuity as well as leave salary as is due and admissible

to the Petitioner, without initiating any disciplinary

proceeding to determine the liability, only on the basis of

audit report after retirement of the employee is without

authority of law. For better appreciation, the relevant portion

of the judgment as contained in para-7 is quoted herein

below:-

"7. Law is well settled that the findings of the Audit Report, per se, cannot be the basis for recovery of any amount from an employee much less a retired employee. In the case of Manoranjan Khadenga v. Chairman, Orissa Forest Development Corporation Ltd., (supra), a co-ordinate bench of this Court, while dealing with a similar case held that withholding the retirement benefits admissible to the Petitioner such as gratuity as well as leave salary without initiating any disciplinary proceeding to determine the liability, only on the basis of the audit report after his retirement is without authority of law. This Court is in respectful agreement with the ratio decided as above. Further, a perusal of the Audit Report does not conclusively reveal that the amount in question // 19 //

was 'Government dues'. In the Finance Department Office Memorandum dated 22nd August, 1991 the expression, 'Government dues' has been held to include 'only arrears of rent and other charges pertaining to occupation of Government accommodation, balance of house building or conveyance advance, overpayment of pay and allowances or leave salary and arrears of Income Tax deductible at source under the Income Tax Act, 1961'. The Office memorandum further states as under;

"As such the amount arising out of Audit report/Para which has not been termed as 'Government dues' cannot be recovered from D.C.R. Gratuity. Such dues can, however, be realized provided the responsibility is fixed by following the appropriate procedure."

19. Additionally, learned Senior Counsel appearing for the

Petitioner, referring to Rule-68 submitted that the said rule

empowers the State Government for recovery of only the

Government dues from the DCRG of the retired employees.

Rule-68(3) defines Government dues, which includes dues

pertaining to government accommodation, dues with respect

to balance of house building or conveyance or any other // 20 //

advance, overpayment of pay & allowances or leave salary

and arrears of Income Tax deductible at the source. In the

aforesaid context, it was further submitted before this Court

that none of such dues are pending against the Petitioner and

in view of the provisions contained in Rule-68, as well as the

Government Circular of the Finance Department as referred

to hereinabove, the surcharge amount, if any, is not

recoverable from the gratuity of the present Petitioner as

Government dues. Moreover, the aforesaid surcharge amount

can very well be recovered from the defaulting/delinquent

Government employee under Section 10(1) of the Odisha

Local Fund Audit Act, 1948. Section 10(1) of OLFA Act,

1948 provides that any surcharge dues can be recovered from

the person concerned as "arrears of land revenue". Therefore,

the pendency of surcharge appeal will have no bearing in the

present writ petition.

20. In the context of pending disciplinary and judicial

proceeding on the date of retirement, learned Senior Counsel // 21 //

for the Petitioner submitted that it is an admitted fact that no

disciplinary proceeding was initiated against the present

Petitioner. So far judicial proceeding arising out of Vigilance

P.S. Case No.84 of 2012 is concerned, learned Senior

Counsel for the Petitioner submitted that, by the date of

Petitioner's retirement from service, no charge sheet have

been filed by the Vigilance Department and consequentially,

no cognizance was also taken by the Court in seisin over the

matter. In the said context, learned Senior Counsel for the

Petitioner, referring to the provisions contained in Rule-7(d)

of OCS (Pension) Rules, 1992, submitted that the aforesaid

provision has been elaborately analysed in a judgment by a

Division Bench of this Court in State of Odisha and others

v. Sushanta Chandra Sahoo and others (W.P.(C) No.14718

of 2015 disposed of vide order dated 06.05.2022). In the

aforesaid case, the Hon'ble Division Bench has categorically

held that a judicial proceeding can be said to be pending

against the employee where cognizance has been taken. Since // 22 //

no cognizance was taken in the present case and the F.I.R.

having been quashed subsequently by this Court, it cannot be

said that a judicial proceeding or any disciplinary proceeding

was pending against the Petitioner on the date of retirement

of the Petitioner, which would deprived the Petitioner of the

benefits which is due and admissible to the Petitioner in the

shape of gratuity or final pension on his retirement. He also

referred to Rule-82 of the OCS (Pension) Rules, 1992 with

regard to the payment of pensionary benefits and since the

Petitioner has not been paid the pensionary and retiral

benefits, he is entitled to interest w.e.f. 01.06.2013 on such

outstanding amount in terms of Notification dated 30.12.1999

issued by the G.A. & P.G. Department, Government of

Odisha.

21. Per contra, learned Additional Government Advocate

appearing for the State-Opposite Parties, by referring to the

counter affidavit submitted that the Opposite Parties have not

committed any illegality while disposing of the representation // 23 //

of the Petitioner pursuant to the order passed by this Court in

the earlier writ petition. He further contended that it would be

wrong to assume that the authority has rejected the

representation of the Petitioner. Further, referring to the order

under Annexure-8 to the writ petition passed by the Opposite

Party No.1 pursuant to the direction of this Court, learned

Additional Government Advocate submitted that the

Opposite Party No.1 has narrated in detail the entire factual

background of the present case. In the aforesaid factual

background, the Opposite Party No.1 while disposing of the

representation vide order under Annexure-8 has finally stated

that expeditious steps have been taken to finalize the retiral

benefits of the Petitioner at the earliest.

22. In course of his argument, learned Additional

Government Advocate further referring to the order passed in

the surcharge proceeding, submitted that on the basis of the

audit report a surcharge proceeding was initiated against the

Petitioner by the Examiner of Local Accounts, Directorate of // 24 //

Local Fund Audit, Odisha. In his order, the Examiner of

Local Accounts, while dropping some of the audit

objections/paras to the tune of Rs.1,96,357/-, has

categorically held that an amount of Rs.7,97,817/- is still to

be recovered from the Petitioner on the basis of the

observations made in the Audit Report. He further contended

that since the amount which is recoverable exceeds the retiral

and pensionary benefits as is due and admissible to the

Petitioner, the Opposite Party No.1, awaiting the final

decision of the Finance Department, has not taken any final

decision in the matter. He further contended that the amount

which is recoverable in view of the surcharge proceeding is

Government due and, as such, the Opposite Party No.1 has

rightly withheld the gratuity and pension of the Petitioner as

per the provisions contained in the relevant statute.

Therefore, no fault can be found with the Opposite Party

No.1 while disposing of the representation of the Petitioner

under Annexure-8 to the writ petition vide order dated // 25 //

13.10.2023. In such view of the matter, learned Additional

Government Advocate submitted that the writ petition filed

by the Petitioner is devoid of merit and, accordingly, the

same should be dismissed.

23. Having due regard to the pleadings of the respective

parties and on a careful analysis of the submissions made by

the learned counsels appearing for the parties, as well as on a

careful examination of the record, this Court is of the view

that the relevant question which falls for determination in the

present writ petition is with regard to the conduct of the

Opposite Party No.1, i.e, whether the Opposite Party No.1 is

within his authority to withhold the retirement as well as

pensionary benefit and gratuity of the Petitioner under the

O.C.S. (Pension) Rules by treating the same to be the

Government dues? Now, therefore, this Court is required to

consider two questions. (1) Whether any disciplinary

proceeding/judicial/criminal proceeding was pending against

the Petitioner on the date of retirement? And (2) whether the // 26 //

dues, as have been fixed in the surcharge proceeding on the

basis of the audit report, can be treated as Government dues

in view of the settled position of law as well as the circular of

the Finance Department dated 27th August, 1991 under

Annexure-9 to the writ petition?

24. The first question that falls for consideration of this

Court is with regard to the pendency of the disciplinary or

judicial/criminal proceeding against the Petitioner on the date

of Petitioner's retirement on 31.05.2013, admittedly, no

disciplinary proceeding whatsoever was initiated against the

present Petitioner. So far judicial/criminal proceeding is

concerned, the assertion in the writ petition is that no charge

sheet was filed and, as such, no cognizance was taken by the

Court in seisin over the matter as on 31.05.2013, i.e. the date

of retirement of the Petitioner. In such view of the matter, this

court is required to decide as to whether the Cuttack

Vigilance P.S. Case No.84 of 2012 lodged on 28.12.2013 can

be construed by this Court as a criminal proceeding pending // 27 //

against the Petitioner on the date of his retirement. This

question has been elaborately discussed, analyzed and

answered in a judgment by a Division Bench of this Court in

Sushanta Chandra Sahoo's case (supra). A copy of the

judgment delivered by the Division Bench on 06.05.2022 has

been annexed as Annexure-13 to the writ petition. On perusal

of the Annexure-13, this Court observes that the Division

Bench of this Court has categorically held that in view of

explanation (b) to Rule-7(2)(1) of Odisha Pension Rules, a

criminal proceeding or judicial proceeding can be said to be

pending against the Government employee when the

Magistrate takes cognizance. In such view of the matter and,

keeping in view of such detailed analysis in the judgment

under Annexure-13, this Court deems it proper not to discuss

the issue any further by wasting valuable judicial time even

otherwise also the judgment of the Division Bench under

Annexure-13 to the writ petition is binding on this Court. In

view of the ratio laid down in the judgment under // 28 //

Annexure-13, i.e. Sushanta Chandra Sahoo's case (supra),

this Court categorically holds that no disciplinary or judicial

proceeding was pending against the Petitioner on the date of

his retirement from service w.e.f. 31.05.2013.

25. With regard to the payment of pensionary and

retirement benefits including the gratuity, this Court by

following a series of judgments of the Hon'ble Supreme

Court is of the considered view that grant of pensionary

benefit and gratuity are no longer matter of bounty to be

distributed by the Government, rather those are in the form of

valuable rights acquired by the retired employees and, as

such, property in their hands and any delay in settlement and

disbursement thereof should viewed seriously and dealt with

severely by imposing penalty in form of payment of interest.

In the OCS (Pension) Rules, a penalty to the tune of 7% has

also been provided. In the aforesaid context, this Court

would like to refer to the judgments in Gorakhpur University

& Ors. V. Dr. Shitla Prasad Nagendra & Ors., reported in // 29 //

AIR 2001 SC 2433; R. Kapur v. Director of Inspection

(Painting and Pulication) Income Tax, reported in (1994) 6

SCC 589; State of Kerela v. M. Padmanavan Nair, reported

in AIR 1985 SC 356; and Som Prakash v. Union of India,

reported in AIR 1981 SC 212.

26. Additionally, this Court would also like to refer to the

judgment by the coordinate Bench in Duryodhan Nayak's

case (supra) wherein it has been categorically held by the

coordinate Bench that the finding in the audit report, per se,

cannot be the basis for recovery of any amount from an

employee, much less a retired employee and the only way to

recover such amount is to first fix the liability by following a

due process of law, i.e., by initiating a disciplinary

proceeding. This Court would also like to refer to the

judgment of Hon'ble Supreme Court in Deokinandan Prasad

v. State of Bihar, reported in (1971) 2 SCC 330 wherein the

Hon'ble Supreme Court has held that the right to grant

pension to a Government servant flows from the rules and the // 30 //

same cannot be withheld by virtue of an executive order.

With regard to the initiation of the disciplinary proceeding,

this Court on a perusal of Rule-7 of the O.C.S. (Pension)

Rules, is of the considered view that the same cannot be

initiated in support of an incident/occurrence which had taken

place more than 4 years prior to the date of institution. A

disciplinary proceeding having not been initiated against the

Petitioner cannot also be initiated now. The aforesaid finding

of this Court gets support from a judgment of this Court in

State of Orissa and Ors. V. Prabodh Kumar Pal, reported in

(2013) II OLR 513.

27. Furthermore, In the context of withholding of pension

or gratuity by the Opposite Parties, this Court is of the

considered view that the law is no more res integra. Such an

issue engaged the attention of the Hon'ble Supreme Court in

the case of Dr. Hira Lal v. State of Bihar and Ors. The

Hon'ble Supreme Court vide judgment dated 18.02.2020 in

Civil Appeal No.1677-1678 of 2020 has categorically held // 31 //

that in the absence of any statutory rules permitting

withholding of pension or gratuity, the State authorities could

not do so by way of executive instructions. This Court, at this

juncture, is also reminded of the settled proposition of law

that an executive instruction which does not have any

statutory sanction cannot be termed as law within the

meaning of Article 300A of the Constitution of India as has

been held by the Hon'ble Supreme Court in Bishamber

Dayal Chandra Mohan v. State of UP, reported in AIR 1982

SC 33 and Hindustan Times v. State of UP, reported in AIR

2003 SC 250.

28. In reply to the second question formulated by this Court

to decide the issue involved in the present writ petition, i.e. as

to whether the dues as has been held to be payable by the

Examiner of Accounts under the OLFA Act, 1948 could be

treated as Government dues? The aforesaid question need not

be discussed elaborately and no further analysis is required in

view of the Circular dated 27th August, 1991 of the Finance // 32 //

Department, Government of Odisha which has been quoted in

the preceding paragraph. Moreover, the aforesaid circular has

been elaborately discussed and analyzed by a coordinate

Bench of this Court in its judgment in Duryodhan Nayak's

case (supra). This Court is required to apply the aforesaid

well-settled principle to the facts of the present case. In the

instant case, the dues that have been claimed by Opposite

Party No.1 as recoverable from the Petitioner arise out of a

surcharge proceeding. Such surcharge proceeding was

initiated on the basis of an audit report by the Local Fund

Auditor. The order of Examiner of Accounts has been

assailed by filing an appeal before the Appellate Authority as

provided under the OLFA Act, 1948. Moreover, taking into

consideration the definition of Government dues as has been

provided in the Finance Department Circular under

Annexure-9, this Court has no hesitation in coming to a

conclusion that the surcharge dues under the OLFA Act,

1948 cannot be construed as Government dues.

// 33 //

29. Moreover, in the event such dues are recoverable, then

a procedure is available under the OLFA Act, 1948 to recover

the same from the retired employee by following the

procedure and by treating such dues as arrear land revenue.

Furthermore, the words "Government dues" having been

defined in the rules as well as circular under Annexure-9 and

the surcharge dues having not been covered under such

definition cannot be construed to be Government dues.

Moreover, by applying the ratio laid down by a coordinate

Bench of this Court in Duryodhan Nayak's case (supra), this

Court is persuaded to hold that the dues in the present case

cannot be construed to be Government dues and, as such, the

same cannot stand as a bar in disbursing the final pension and

gratuity to the Petitioner. Since the amount as is due and

admissible to the Petitioner on account of final pension and

gratuity has been withheld by the Opposite Parties without

any sanction of law, therefore, the Opposite Parties are liable // 34 //

to pay penal interest to the Petitioner as has been provided

under the relevant rules.

30. With regard to payment of penal interest, this Court

would like to refer to the judgment of the Hon'ble Supreme

Court in D.D. Tiwari's case (supra), which has been followed

by this Court in Gobardhan Nayak v. State of Orissa and

others, reported in (2021) (III) ILR-CUT-60 and,

accordingly, an employee has been granted interest @ 18%.

Moreover, this Court on a reading of the judgment of the

Hon'ble Supreme Court in Gangahanume Gowda v.

Karnataka Agro Industries Corporation Ltd., reported in

(2003) 3 SCC 40 as well as in S.K. Dua v. State of Haryana

and others, reported in (2008) 3 SCC 44, wherein it has been

held that interest on delayed payment of gratuity as well as

pensionary benefits is mandatory, is of the considered view

that the employee concerned needs to be compensated for

such delayed payment of dues.

// 35 //

31. In view of the aforesaid analysis of factual background

of the present case as well as the point of law involved in the

present writ petition and, also in view of the various

judgments referred to hereinabove laying down the

proposition of law, this Court is inclined to hold that the

Petitioner in the absence of any judicial/criminal or

disciplinary proceeding is entitled to the pensionary and other

retiral benefits including the gratuity upon his retirement

from service w.e.f. 31.05.2013. Since the same has not been

paid to the Petitioner as of now, the reply of Opposite Party

No.1 under Annexure-8 is hereby quashed. Accordingly, the

Opposite Party No.1 is directed to pay the retirement benefits

including gratuity, unutilized leave salary and other financial

and pensionary benefits, as is due and admissible to the

Petitioner, as per law within a period of two months from the

date of communication of this judgment along with interest

@ 18%.

// 36 //

32. With the aforesaid observation and direction, the writ

petition is allowed. However, there shall be no order as to

costs.

(A.K. Mohapatra) Judge

Orissa High Court, Cuttack The 1st March, 2024/Debasis Aech, Secretary