Mohd. Kareem vs The State Of Telangana And Another
2024 Latest Caselaw 3487 Tel

Telangana High Court

Mohd. Kareem vs The State Of Telangana And Another on 30 August, 2024

     THE HONOURABLE SMT. JUSTICE T. MADHAVI DEVI


           I.A.NO.1 OF 2021 IN W.P.NO.16993 OF 2020

                                   AND

                WRIT PETITION NO.16993 OF 2020


                          COMMON ORDER

In this writ petition, the petitioner is seeking a Writ of Mandamus

declaring the proceedings No.TSSDC/ADMN/Disc.Case/2020-21/254

dt.18.08.2020 wherein an amount of Rs.5,68,000/- of earned leave of the

petitioner is withheld as well as recovery of an amount of Rs.3,98,408/-,

as illegal, arbitrary and unconstitutional and consequently to set aside

the same and to direct the respondents to remit the sum of Rs.5,68,000/-

recovered from encashment of the earned leave of the petitioner with

interest at 18% per annum and to pass such other order or orders.

2. Brief facts leading to the filing of the present writ petition are that

the petitioner was appointed as a Store Keeper in the year 1994 in the

2nd respondent Corporation and has been discharging his duties

accordingly. While the petitioner was working as Store Keeper at

Nidamanoor Unit, it was alleged that there was some shortage of paddy

and a Committee was constituted to enquire into the same. It is stated

that Sri T.Venkataswamy, Seed Officer and Processing In-charge was

responsible for the said shortages and the stocks have not been handed

over to the petitioner, but unfortunately, the Committee, without looking

into the statement of the petitioner, observed that the Processing

Incharge has not handed over the seeds stock to the Store Keeper., the

petitioner, and since the petitioner has not taken over seeds stock, both

are responsible for shortage of paddy stock. On the basis of the said

report of the Committee, the petitioner was placed under suspension

vide orders dt.11.10.2012. Thereafter, a charge memo was issued to the

petitioner on 05.11.2012 with the following two charges:

"I. He failed to account for the stocks and responsible for shortage of 644.60 qtls of Paddy BPT-5204 seed valuing Rs.13,66,035/- thereby committed misconduct of misappropriation and dishonesty in connection with the Company's business under Rule 4(x) of Disciplinary & Appeal Rules for the employees of the Corporation."

"II. He neglected his duties and failed to verify stocks physically and entering the IDP quantities into the stock ledgers and thereby committed misconduct of neglect of duties under Rule 4(ii) of Disciplinary & Appeal Rules for the employees of the Corporation."

The petitioner submitted his reply denying the said charges. Thereafter,

amended charge memo dt.08.01.2014 was given, wherein charge No.1

in charge memo dt.05.11.2012 was amended alleging that the petitioner

was responsible for shortages of 28,575 kgs., foundation seeds, 12,858

kgs., of certified seeds and 95,897.50 kgs., of non-seeds and different

crop varieties, valued at Rs.46,34,678.14 during the year 2012-13. A

statement of imputation, purportedly based on the report of the Internal

Audit conducted on 16.05.2013 to 18.05.2013 behind petitioner's back,

was supplied to the petitioner. The petitioner submitted his explanation.

However, the disciplinary authority was not convinced with the

explanation of the petitioner and appointed an enquiry officer. The

enquiry officer did not deal with any of the contentions of the petitioner

nor did he discuss any evidence and none of the witnesses mentioned in

the charge memo have been examined by the enquiry officer. However,

he submitted his enquiry report holding charges against the petitioner as

partly proved. According to the petitioner, the enquiry was concluded

within a period of half an hour by taking only the statement of the

petitioner and therefore, it was not conducted in accordance with rules.

The enquiry report was communicated to the petitioner and the

petitioner's explanation was called for vide memo dt.23.04.2018. In the

meantime, the petitioner had retired from service on attaining the age of

superannuation on 31.07.2017. But the impugned order of punishment

and recovery was passed on 18.08.2020. In the order, recovery of

Rs.10,66,407/- was ordered and a sum of Rs.5,68,000/- of earned leave

encashment of the petitioner was withheld and balance amount of

Rs.3,98,408/- was ordered to be recovered. Challenging the same, the

present Writ Petition has been filed.

3. This Court, vide orders dt.30.09.2020 has granted interim stay of

recovery pursuant to the proceedings dt.18.08.2020.

4. The 2nd respondent has filed counter affidavit along with vacate

petition in I.A.No.1 of 2021.

5. Learned counsel for the petitioner reiterated the submissions

made in the writ affidavit and submitted that the respondent Corporation

is a wholly owned State Government Corporation and after bifurcation

of the erstwhile State of Andhra Pradesh, the Telangana State Seeds

Development Corporation was bifurcated and incorporated as a Public

Limited Company on 05.02.2015 and that it has its own service rules. It

is submitted that in the relevant service rules, there was no power vested

in the respondents to continue the enquiry after the petitioner has retired

from service and there was no power under the rules to impose such

penalty of recovery of amounts from the pensionary benefits of the

petitioner. He referred to the Discipline and Appeal Rules of the Andhra

Pradesh State Seeds Development Corporation Limited and submitted

that Rule 3 thereof deals with nature of penalties and sub-rule (ii)

thereof refers to major penalties and Clause (d) thereunder refers to

recovery of loss/damage in full or part, which has been deleted vide

179th Board Meeting held on 12.08.2014. Therefore, according to him,

the order of recovery of loss could not have been imposed under the

amended rules. He referred to the decision of the Hon'ble Supreme

Court in the case of Bhagirathi Jena Vs. Board of Directors, O.S.F.C.

and others 1 for the proposition that in the absence of any provision for

recovery from retirement benefits and for continuation of departmental

enquiry after superannuation, the same cannot be resorted to by the

Corporation. For the proposition that disciplinary proceedings cannot be

continued after retirement in the absence of specific provision for the

same, he placed reliance upon the decision of the Hon'ble Supreme

Court in the case of Dev Prakash Tewari Vs. Uttar Pradesh

Cooperative Institutional Service Board, Lucknow and others 2. For

the proposition that there can be no recovery from the pension or

gratuity in the absence of a provision allowing the same, he placed

AIR 1999 SC 1841

(2014) 7 SCC 260

reliance upon the decision of the Hon'ble Supreme Court in the case of

State of Jharkhand and others Vs. Jitendra Kumar Srivastava and

another3. He placed reliance upon the decision of the High Court of

Judicature at Hyderabad for the State of Telangana and the State of

Andhra Pradesh in the case of Ch. Pandu Ranga Rao Vs. the State of

Andhra Pradesh rep. by its Principal Secretary, Agriculture and

Cooperation Department and another4 for grant of interest on delayed

payment of gratuity and leave encashment amount which have been

withheld without any authority of law. Thus, he prayed for setting aside

of the impugned order and a direction to the respondents to refund the

amount, which has been withheld, with interest at 18% per annum as

prayed for in the Writ Petition.

6. In the counter affidavit filed by the 2nd respondent, it is stated that

the petitioner was appointed as a Store Keeper at Nidamanoor Branch in

the year 1994 and during the year 2011-2012, the 2nd respondent

received a complaint from the District Manager regarding shortage of

stock in the Nidamanoor Unit and on the basis of such complaint, a

Committee was deputed for physical verification of the stock of the Unit

(2013) 12 SCC 210

W.P.No.26371 of 2016 dt.12.07.2017

and it is submitted that a shortage of seed stock at Nidamanoor Unit

valuing at Rs.13,66,035/- was found and therefore, a charge memo has

been issued to the petitioner. It is submitted that after the enquiry report

was submitted on 01.07.2013, the petitioner has paid a sum of

Rs.1,00,000/- and also furnished a letter on 10.10.2013 along with an

undertaking requesting the 2nd respondent to revoke his suspension and

that he will pay the amount subject to the result and outcome of the

enquiry proceedings against the charge memo dt.20.11.2012 and

therefore, the suspension of the petitioner has been revoked and the

petitioner has been reinstated into service. It is submitted that after the

Internal Audit Committee physically verified the stock and found

shortage in stock valuing at Rs.46,34,678.14 for the year 2012-2013,

charge No.1 in the charge memo dt.05.11.2012 was amended and it was

found that the petitioner totally failed to account for the shortage of seed

stock. It is submitted that along with the petitioner, one Sri

T.Venkataswamy, Seed Officer was also charged and that he had filed

an appeal before the appellate authority and the same was pending. It is

submitted that departmental enquiry has been instituted against the

petitioner while he was in service and the enquiry was conducted in

accordance with rules prior to the retirement of the petitioner. He relied

upon the decision of the Hon'ble Supreme Court in the case of V.

Padmanabham Vs. Government of Andhra Pradesh and others5 for

the proposition that where there is a huge loss caused to the Corporation,

there is no legal impediment in imposing any punishment such as

withholding whole or part of the pension so as to enable the State to

recover the amount which is suffered owing to the acts of omission or

commission on the part of the employee. The 2nd respondent also relied

upon the judgment of the Hon'ble Supreme Court in the case of U.P.

State Sugar Corporation Ltd. and others Vs. Kamal Swaroop

Tondon6 for the proposition that where proceedings were initiated after

retirement in which it was held that in the case of retirement master and

servant relationship continues for grant of retirement benefits and

proceedings for recovery of financial loss from the employee is

permissible even after his retirement where the departmental enquiry

was instituted prior to the retirement of the employee. Therefore, the

impugned order was justified in the counter affidavit and prayed for

vacation of the interim order and dismissal of the Writ Petition.

(2009) 15 SCC 537

(2008) 2 SCC 41

7. Having regard to the rival contentions and the material on record,

this Court finds that the departmental proceedings were initiated when

the petitioner was still in service by issuance of the charge memo and

the amended charge memo. The petitioner has retired from service in the

year 2017, whereas the enquiry officer has submitted his report on

19.04.2018 and the same was communicated to the petitioner vide letter

dt.23.04.2018. From the enquiry report, it is noticed that there was

excess quantity of paddy MTU-1010 F/s and paddy BPT-5204 as per

physical verification stocks handed over by the petitioner on 20.10.2012

and there was shortage of non-seed paddy of 95,895 kgs. The enquiry

officer has observed that sale of non-seed of paddy BPT-5204 is more

than two years old and was heavily infested and that it was carried

forward as stocks and hence, there was high shortage of quantity

reported due to weighing loss and that most of the seed procured was of

bad quality, hence there were lot of rejections as compared to book

balance. Thus observing, the enquiry officer had requested the

disciplinary authority to take a decision thereon and the enquiry officer

has also observed that excess quantities have been observed which

cannot be the case practically but as per records the same is reflected. In

view of these, the charge as per the amended charge memo

dt.05.11.2012 was held as partly proved. The amended charge memo

was only with respect to charge No.1. With regard to chargeNo.2, there

is no finding by the enquiry officer. Therefore, it has to be presumed

that the charge against the petitioner in respect of charge No.2 is not

proved. Further, it is noticed that one Sri T.Venkataswamy, Seed Officer

was also charged along with the petitioner for the very same charges. In

such circumstances, there should have been a joint enquiry in respect of

both the persons, but the enquiry officer does not mention any

discrepancy found in respect of T.Venkataswamy. The petitioner had

raised preliminary objections before the disciplinary authority, but the

same have not been taken into consideration by the disciplinary

authority. Further, as rightly pointed out by the learned counsel for the

petitioner, the Discipline and Appeal Rules do not provide for

imposition of penalty of recovery of loss/damage in full or part. The said

punishment was deleted in the 179th Board Meeting held on 12.08.2014.

In the absence of the provision of law for such recovery, the penalty of

recovery of loss cannot be imposed. The judgments relied upon by the

learned counsel for the petitioner support this view.

8. In the case of Bhagirathi Jena Vs. Board of Directors, O.S.F.C.

and others (1 supra), the Hon'ble Supreme Court has observed as

under:

"5. It will be noticed from the abovesaid regulations that no specific provision was made for deducting any amount from the provident fund consequent to any misconduct determined in the departmental enquiry nor was any provision made for continuance of the departmental enquiry after superannuation.

6. In view of the absence of such a provision in the abovesaid regulations, it must be held that the Corporation had no legal authority to make any reduction in the retiral benefits of the appellant. There is also no provision for conducting a disciplinary enquiry after retirement of the appellant and nor any provision stating that in case misconduct is established, a deduction could be made from retiral benefits. Once the appellant had retired from service on 30-6-1995, there was no authority vested in the Corporation for continuing the departmental enquiry even for the purpose of imposing any reduction in the retiral benefits payable to the appellant. In the absence of such an authority, it must be held that the enquiry had lapsed and the appellant was entitled to full retiral benefits on retirement.

7. Learned Senior Counsel for the respondent placed reliance on the judgment of this Court in Takhatray Shivadattray Mankad v. State of Gujarat [1989 Supp (2) SCC 110 : 1991 SCC (L&S) 927 : (1990) 12 ATC 692] . It is true that that was a case of imposing a reduction in the pension and gratuity on account of unsatisfactory service of the employee as determined in an enquiry which was extended beyond the date of superannuation. But the above decision cannot help the

respondent inasmuch as in that case there was a specific rule namely Rule 241-A of the Junagadh State Pension and Parwashi Allowance Rules, 1932 which enabled the imposition of a reduction in the pension or gratuity of a person after retirement. Further, there were rules in that case which enabled the continuance of the departmental enquiry even after superannuation for the purpose of finding out whether any misconduct was established which could be taken into account for the purpose of Rule 241-A. In the absence of a similar provision with the regulations of the respondent-Corporation, the above judgment of Mankad case [1989 Supp (2) SCC 110 : 1991 SCC (L&S) 927 : (1990) 12 ATC 692] cannot help the respondent."

9. In the case of Dev Prakash Tewari Vs. Uttar Pradesh

Cooperative Institutional Service Board, Lucknow and others (2

supra), the Hon'ble Supreme Court followed its earlier decision in the

case of Bhagirathi Jena Vs. Board of Directors, O.S.F.C. and others

(1 supra) to hold that after the employee has retired from service, there

was no authority vested with the respondents for continuing the

disciplinary proceedings for the purpose of imposing any reduction in

the retiral benefits payable to the employee, the enquiry had lapsed and

the petitioner was entitled to get full retiral benefits. For the purpose of

ready reference, the relevant para i.e., para 8 is reproduced as under:

"8. Once the appellant had retired from service on 31-3-2009, there was no authority vested with the respondents for continuing the disciplinary proceeding even for the purpose of imposing any reduction in the retiral benefits payable to the appellant. In the

absence of such an authority it must be held that the enquiry had lapsed and the appellant was entitled to get full retiral benefits."

10. In the case of State of Jharkhand and others Vs. Jitendra

Kumar Srivastava and another (3 supra), it was held as under:

"16. The fact remains that there is an imprimatur to the legal principle that the right to receive pension is recognised as a right in "property". Article 300-A of the Constitution of India reads as under:

"300-A.Persons not to be deprived of property save by authority of law.--No person shall be deprived of his property save by authority of law."

Once we proceed on that premise, the answer to the question posed by us in the beginning of this judgment becomes too obvious. A person cannot be deprived of this pension without the authority of law, which is the constitutional mandate enshrined in Article 300-A of the Constitution. It follows that attempt of the appellant to take away a part of pension or gratuity or even leave encashment without any statutory provision and under the umbrage of administrative instruction cannot be countenanced.

17. It hardly needs to be emphasised that the executive instructions are not having statutory character and, therefore, cannot be termed as "law" within the meaning of the aforesaid Article 300-A. On the basis of such a circular, which is not having force of law, the appellant cannot withhold even a part of pension or gratuity. As we noticed above, so far as statutory Rules are concerned, there is no provision for withholding pension or gratuity in the given situation. Had there been any such provision in these Rules, the position would have been different."

11. Therefore, it is clear that unless and until, the Discipline and

Appeal Rules authorise the respondents to continue the disciplinary

proceedings after the retirement of the employee and the Discipline and

Appeal Rules also authorise the respondent authorities to recover the

loss from the retirement benefits of the employee, the same cannot be

done.

12. The judgments relied upon by the respondents in their counter are

distinguishable on facts. In the case of V. Padmanabham Vs.

Government of Andhra Pradesh and others (5 supra), the Hon'ble

Supreme Court was considering the case of the petitioner therein against

whom departmental proceedings were proceeded with under Rule 9(2)

of Andhra Pradesh Pension Code and as a large sum of money had to be

recovered from the appellant therein, it was held that delay alone in the

case should not be held to be fatal in the matter of continuing the

departmental proceedings. In the case of U.P. State Sugar Corporation

Ltd. and others Vs. Kamal Swaroop Tondon (6 supra) which is relied

upon by the 2nd respondent in its counter affidavit, the show-cause

notice for removal from service was issued before the date of retirement

and therefore, it was held that in the case of retirement, master and

servant relationship continues for grant of retiral benefits. In the case

before this Court, the enquiry report was submitted after the retirement

of the petitioner and punishment order has been also passed after his

retirement. Further, as seen from the enquiry report, no witnesses have

been examined and no documents, except for the internal audit report,

have been referred to. The internal audit seems to have been conducted

behind the back of the petitioner. Therefore, the impugned order is in

violation of principles of natural justice as it is not in accordance with

the Discipline and Appeal Rules of the Andhra Pradesh State Seeds

Development Corporation Limited. The impugned order also does not

mention the basis for arriving at the financial loss of Rs.10,66,407/-.

13. In view of the same, this Court is inclined to set aside the

impugned order dt.18.08.2020 and directs the respondents to refund the

withheld amount of Rs.5,68,000/- to the petitioner expeditiously, i.e.,

within a period of three months from the date of receipt of a copy of this

order, failing which the petitioner shall be eligible interest at the rate of

6% per annum from such expiry of the period till the date of payment.

14. In the result,--

(1) W.P.No.16993 of 2020 is accordingly allowed.

(2) I.A.No.1 of 2021 is dismissed.

(3) There shall be no order as to costs.

15. Pending miscellaneous petitions, if any, in this Writ Petition shall

stand closed.

___________________________ JUSTICE T. MADHAVI DEVI

Date: 30.08.2024

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