Gujarat High Court
Sarlaben Natubhai Gadsa (Sarlaben ... vs Ahmedabad Municipal Corporation on 14 July, 2025
NEUTRAL CITATION
C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 11289 of 2016
With
R/SPECIAL CIVIL APPLICATION NO. 11295 of 2016
With
R/SPECIAL CIVIL APPLICATION NO. 15295 of 2019
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE SANDEEP N. BHATT
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Approved for Reporting Yes No
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SARLABEN NATUBHAI GADSA (SARLABEN POONAMJIBHAI BHAGORA)
Versus
AHMEDABAD MUNICIPAL CORPORATION
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Appearance:
MR HARDIK C RAWAL(719) for the Petitioner(s) No. 1
MR HS MUNSHAW(495) for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE SANDEEP N. BHATT
Date : 14/07/2025
COMMON ORAL JUDGMENT
1. Since the prayers and facts involved in the present petitions are almost similar, and the issues involved in the present petitions are identical in nature, hence, at the request of learned advocates appearing for the respective parties, the matters are heard together and decided together and Special Civil Application No.11295 of 2016 is considered as lead matter.
2. The present petition is filed for seeking the Page 1 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined following reliefs:
"(A) be pleased to allow this petition.
(B) be pleased to issue a writ of mandamus or any other appropriate writ, order or direction by quashing and setting aside the impugned order dated 27-3-2015 bearing reference No. IREST No. 7034 (Annexure A) and further direct the respondent to pay all consequential and incidental benefits pursuance to the quashing of the impugned order at Annexure A to this petition.
(C) pending admission, hearing and final disposal of this petition, be pleased to stay the operation, implementation, execution and enforcement of the impugned order dated 27- 3-2015 bearing reference No. IREST No. 7034 (Annexure A)."
3. Brief facts as stated in the memo of the petition are as under:
3.1 It is the case of the petitioner that the petitioner herein is serving as head clerk in Tax Department of the respondent corporation. The petitioner was appointed as Junior Clerk on 28.11.1989 and was thereafter promoted to the post of senior clerk in 07.10.1995 and to the post of head clerk in 08.09.2012. The petitioner Page 2 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined worked as a valuation officer of Isanpura Ward for the year 2013-14. A show cause notice dated 25.08.2014 was issued bearing Reference No.651 by the Deputy Municipal Commissioner (Tax) as to why departmental inquiry/steps should not be initiated against the petitioner. It is pertinent to note that the above mentioned notice was issued as the tax inspector had assessed the area of parking zone (which was used for parking trucks at night) at 6722.47 sq. meters and it was signed by the petitioner as superior officer. In fact, as per the rules the petitioner has to randomly check 10% of the measurement done by the tax inspector and the present property was not in that 10% property which were checked by the petitioner.
3.2 It is further the case of the petitioner in this petition that normally, the additional checking is done in the properties where the area of the property is decreased by the inspector. An application dated 21.02.2014 was made by the owner of the property and the measurement was reduced to 2221.05 sq. meters. It is further the case of the petitioner in this petition that the petitioner submitted a detailed reply dated 08.09.2014 Page 3 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined justifying the bonafide action of the petitioner. The petitioner was directed to remain personally present on 10.03.2015. The petitioner remained present and explained the action which was just and legal on 10.03.2015. In the said personal hearing the deputy Municipal Commissioner (Tax) acted as prosecutor and judge. However without issuing any charge sheet or holding any departmental inquiry, the impugned order dated 27.03.2015 was passed imposing punishment of stoppage of two increments with future effect. 3.3 It is further the case of the petitioner in this petition that aggrieved by the same, the petitioner preferred the representation for review on 12.10.2015. It is further the case of the petitioner in this petition that The petitioner has not received any reply to the same. Hence, the present petition has been preferred.
4. Heard Mr. Hardik Raval, learned advocate for the petitioner and Mr. H.S. Munshaw, learned advocate for the respondent No.1.
5.1 Mr. Hardik Raval, learned advocate for the Page 4 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined petitioner mainly contended by drawing the attention of this Court towards the impugned order passed by the authority concerned and the show cause notice which is issued by asking the petitioner why further departmental action should not be taken against the petitioner as there is serious error committed in measurement of the land of Tax Assessee and thereafter, the impugned order is passed without holding any departmental inquiry and, therefore, he has submitted that impugned order is bad in the eyes of law on the ground that the show cause notice is only for the purpose of inquiry and by impugned order, straightaway order is passed for imposing punishment withholding two increments with future effect that is not permissible in the eyes of law. He has further submitted that the Authority cannot act beyond the scope of show cause notice and, therefore also, impugned order is bad in the eyes of law. He has submitted that though the petitioner has asked for documents, no documents were provided to the petitioner and straightaway by considering the reply to the notice, the impugned order is passed by the authority, that is bad in the eyes of law as in absence of document, the petitioner could not defend his case in appropriate Page 5 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined manner and even in the departmental proceeding. He has submitted that even looking to the impugned order the order, it transpires that the same is unreasoned order, that means, non-speaking order without assigning proper reasons or without giving any proper findings and, therefore, the said order is bad in the eyes of law. He has further submitted that stoppage of two increments with future effect is required to be considered as harsh punishment and major penalty and for imposition of major penalty, the full-fledged departmental inquiry is must and, therefore, he has submitted that impugned action of the respondent Authority is bad in the eyes of law.
5.2 In support of his submissions, Mr. Hardik Raval, learned advocate for the petitioner has relied on the judgment of the Hon'ble Apex Court in the cases of (i) Kulwant Singh Gill vs. State of Punjab and Haryana reported in 1991 (Supp 1) SCC 504, more particularly, he has relied paragraph 4, (ii) Punjab State Electricity Board Now Punjab State Power Corporation Limited vs. Raj Kumar Goel reported in 2014 (15) SCC 748, more particularly, paragraphs 11 to 16 are relevant. He has Page 6 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined also relied on the judgment of this Court in the case of Dashrathlal Ishwarlal Patel vs. State of Punjab reported in 2013 (2) GLR 1257, more particularly, paragraphs 15 to 19, 31 and 34 are relevant and has submitted that in view of these decisions, the present petitions are required to be allowed.
6.1 Per contra, Mr. H.S. Munshaw, learned advocate for the respondent no.1 has, by referring to the affidavit-in- reply and other documents and annexed thereto, contended that the present petition of the petitioner is misconceived and considering the fact that petitioner is indulged in serious misconduct as Tax Assessing Officer, appropriate proceeding is initiated after giving opportunity of hearing by issuing show cause notice and after considering the show cause notice and reply of show cause notice, punishment is imposed upon the petitioner. He has submitted that the necessary statement is also recorded pursuant to the show cause notice and by referring to the manual of the Ahmedabad Municipal Corporation, more particularly, Chapter 5 of the manual and has submitted that procedure to be adopted for the action, which is required to be taken Page 7 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined against the delinquent, is provided in the said manual. 6.2 He has also relied on Section 56) of the said Bombay Provincial Municipal Corporation Act and has submitted that corporation is empowered to pass appropriate order after giving opportunity of hearing to its employees and after considering the gross misconduct of the petitioner, the penalty, which is by way of the stoppage of two increments with future effect, cannot be considered as disproportionate. He has further submitted that in the present case, an objection to the assessment of the tax is received from the owner of the particular premises and on verification, it is found that the petitioner, with a view to harass the assessee, has recorded incorrect measurement, which runs into multiple times than the actual measurement and, therefore, such conduct cannot be permitted and an appropriate punishment is required to be imposed on the petitioner. 6.3 In support of his contentions, Mr. H.S. Munshaw, learned advocate for the respondent no.1 has relied on the judgment of the Hon'ble Apex Court in the case of Rajesh Pravinchandra Rajyaguru vs. Gujarat Water Page 8 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined Supply And Sewerage Board and Others rendered in Civil Appeal No.7578 of 2021 and Civil Appeal No.7579 of 2021. He has relied on the judgment of Co-ordinate Bench of this Court rendered in Special Civil Application No.6626 of 2017 28.09.2017, more particularly, paragraphs 3, 4.1 and 4.2 are relevant as well as the judgment of Division Bench of this Court rendered in Letters Patent Appeal No.82 of 2020 in Special Civil Application No.16470 of 2018, more particularly, paragraphs 18 and 21 are relevant and has contended that present petitions are required to be dismissed as this Court has limited scope in interfering with the departmental punishment imposed by way of the departmental proceeding and, therefore, the present petition is required to be dismissed.
7. In rejoinder to the arguments made by Mr. H.S. Munshaw, learned advocate for the respondent No.1, Mr. Hardik Raval, learned advocate for the petitioner has lastly submitted, by referring to the affidavit-in-rejoinder, that respondent corporation is not practising what it is preaching. He has submitted that in the said incident, it is the duty of the Board Inspector against whom no Page 9 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined action has been taken and discriminatory treatment was given to the present petitioner and, therefore, he has submitted that one of the petitioners has already retired in one of the captioned petitions and, therefore, considering the same, appropriate order may be passed in the present petition.
8. In response to the submission made by Mr. Hardik Raval, learned advocate for the petitioner, Mr. H.S. Munshaw, learned advocate for the respondent No.1 has submitted that negative equity cannot be claimed by the person, who is seeking equitable relief from any Court and, therefore, he has submitted that present petition is required to be dismissed.
9.1 I have considered the rival submissions made at the bar. I have also considered the pleadings of the parties like memo of the petition and documents annexed thereto, affidavit-in-reply and documents annexed thereof and rejoinder and documents annexed thereof. It clearly transpires that the proceeding is initiated against the present petitioner, who was working as Valuation Officer at the relevant point of time and for the assessment of Page 10 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined the property of one Mr. Ilesh R. Bhadda on 21.02.2014, the application is given to the Assessment Office at South Zone of the Ahmedabad Municipal Corporation and accordingly, measurement of the said premises has been done and was found to be 2221.05 sq. m., whereby the extent of assessment which was carried out by the petitioner of the said premises is to the extent 6722.47 sq.m. and, therefore, the corporation has to reduce the amount of tax as the petitioner has carried out exorbitant assessment of the said premises by mentioning almost three times more than the actual measurement of the said premises.
9.2 In this background, it transpires that on 25.08.2014, show cause notice was issued for initiating the departmental proceeding and for giving the explanation, why the departmental action should not be taken against the petitioner. Thereafter, on 27.03.2015, the impugned order is passed by imposing penalty of stoppage of two increments with future effect by the Deputy Municipal Commissioner. On perusal of the said order, it transpires that explanation in show cause notice is also considered as well as the petitioner was heard personally by the Page 11 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined inquiry officer.
9.3 At this stage, it is fruitful to refer Section 56 of the Bombay Provincial Municipal Corporation Act, which reads as under:
"56. Imposition of penalties on municipal officers and servants. -
(1) A competent authority may subject to the provisions of this Act impose any of the penalties specified in sub-section (2) on a municipal officer or servant if such authority is satisfied that such officer or servant is guilty of a breach of departmental rules or discipline or of carelessness, neglect of duty or other misconduct or is incompetent:
Provided that-
(a) no municipal officer or servant whose monthly salary, exclusive of allowances, [exceeds such amount as may be fixed in this behalf, by a general or special order, by the State Government in the case of each Corporation] shall be dismissed by the Commissioner without the previous approval of the Standing Committee;
(b) any officer appointed by the Corporation excepting the Transport Manager may be suspended by the Standing Committee pending an order of the Corporation, such suspension and the reason therefore being forthwith reported to the Corporation;
(c) the Commissioner may impose any of the penalties Page 12 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined specified in clause (a), (b), [c] (d), and (e) of sub-section (2) on any officer appointed by the Corporation other than the Transport Manager or any officer appointed under section 45;
(d) the Municipal Chief Auditor and the Municipal Secretary may impose any of the penalties specified in clauses (a), (b),
(c), (d) and (c) of sub-section (2) on any officer or servant immediately subordinate to them and drawing a monthly salary [not exceeding such amount as may be fixed by the State Government, by a general or special order, from time to time in case of each Corporation] subject to a right of appeal to the Standing Committee and the Standing Committee may impose any other penalty on any such officer or servant and may also impose any penalty on any other officer or servant immediately subordinate to the Municipal Chief Auditor or the Municipal Secretary;
(2) The penalties which may be imposed under this section are the following, namely:-
(a) censure;
(b) withholding of increments or promotion, including stoppage at an efficiency bar;
(c) reduction to a lower post or time-scale, or to a lower stage in a time-scale;
(d) fine;
(e) recovery from salary of the whole or part of any pecuniary loss caused to the Corporation;
(f) suspension;
(g) removal from municipal service which does not disqualify Page 13 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined from future employment;
(h) dismissal from municipal service which ordinarily disqualifies from future employment.
(3) No officer or servant shall be reduced to a lower post or removed or dismissed from service under this section unless he has been given a reasonable opportunity of showing cause against such reduction, removal or dismissal:
Provided that, this sub-section shall not apply-
(a) where a person is reduced, removed or dismissed on the ground of conduct which has led to his conviction on a criminal charge; or
(b) where the competent authority is satisfied that, for reasons to be recorded in writing by such authority, it is not reasonably practicable to give that person an opportunity of showing cause.
(4) Subject to the provisions of clause (d) of the proviso to sub-section (1), any municipal officer or servant who is reduced, removed or dismissed by any authority other than the Corporation may, within one month of the communication to him of the order of reduction, removal or dismissal, appeal to the authority immediately superior to the authority which imposed the penalty and the appellate authority may, after obtaining the remarks of the authority which imposed the penalty, either confirm the order passed or substitute for it such orders as it considers just, including an order for the imposition of some lesser penalty, Page 14 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined and effect shall forth be given to any order passed by the appellate authority which shall be conclusive:
Provided that, for the purposes of this sub-section, the Standing Committee shall be deemed to be the authority immediately superior to the Commissioner and the Corporation shall be deemed to be the authority immediately superior to the Standing Committee.
(5) With reference to officers and servants appointed under Chapter XX the provisions of this section shall apply as if for the word "Commissioner" the words "Transport Manager"
and for the words "Standing Committee" the words "Transport Committee" had been substituted. Explanation. - (1) For the purposes of this section a competent authority is the authority which under the provisions of this Act is competent to make the appointment to the post held by the particular municipal officer or servant.
(2) The monthly salary which would ordinarily be admissible to a municipal officer or servant on the date immediately preceding the date of the order imposing a penalty shall be deemed to be his salary for the purposes of the provision to sub-section (1).
Leave of Absence, Acting Appointments, Etc." 9.4 It is also relevant to note that corporation has also provided some procedure in its manual for the imposition Page 15 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined of such penalties upon the delinquents. 9.5 In this factual backgrounds, it is fruitful to refer the legal submissions made by learned advocates for the respective parties.
9.5.1 It is fruitful to refer the judgment cited at the bar by Mr. Hardik Raval, learned advocate for the petitioner in the case of Kulwant Singh Gill (supra), more particularly, paragraph 4 is relevant, as under:
"4. Withholding of increments of pay simpliciter undoubtedly is a minor penalty within the meaning of Rule 5(iv). But sub-rule (v) postulates reduction to a lower stage in the time-scale of pay for a specified period with further directions as to whether or not the Government employee shall earn increments of pay during the period of such reductions and whether on the expiry of such period the reduction will or will not have the effect of postponing the future increments of his pay. It is an inde- pendent head of penalty and it could be imposed as punish- ment in an appropriate case.
It is one of the major penalties. The impugned order of stoppage of two increments with cumulative effect whether would fall within the meaning of Rule 5(v)? If it so fails Rules 8 and 9 of the Rules require conducting of regular Page 16 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined enquiry. The contention of Shri Nayar, learned counsel for the State is that withholding two increments with cumulative effect is only a minor penalty as it does not amount to reduction to a lower stage in the time-scale of pay. We find it extremely difficult to countenance the contention. With- holding of increments of pay simpliciter without any hedge over it certainly comes within the meaning of Rule 5(iv) of the Rules. But when penalty was imposed withholding two increments i.e. for two years with cumulative effect, it would indisputably mean that the two increments earned by the employee was cut off as a measure of penalty for ever in his upward march of earning higher scale of pay. In other words the clock is put back to a lower stage in the time- scale of pay and on expiry of two years the clock starts working from that stage afresh. The insidious effect of the impugned order, by necessary implication, is that the appel- lant employee is reduced in his time-scale by two places and it is in perpetuity during the rest of the tenure of his service with a direction that two years' increments would not be counted in his time- scale of pay as a measure of penalty. The words are the skin to the language which if pealed off its true colour or its resultant effects would become apparent. When we broach the problem from this per- spective the effect is as envisaged under Rule 5(v) of the Rules. It is undoubted that the Division Bench in Sarwan Singh v. State of Punjab & Ors., I.L.R. 1985 2 P & H. 193, P.C. Jain, A.C.J. speaking for the division bench, while considering similar question, in paragraph 8 held that the stoppage of increments with cumulative effect, by no stretch of Page 17 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined imagination falls within clause (v) of Rule 5 or in rule 4.12 of Punjab Civil Services Rules. It was further held that under clause (v) of Rule 5 there has to be a reduction to a lower stage in the time-scale of pay by the competent authority as a measure of penalty and the period for which such a reduction is to be effective has to be stated and on restoration it has further to be specified whether the reduction shall operate to postpone the future increments of his pay. In such cases withholding of the increments without cumulative effect does not at all arise. In case where the increments are withhold with or without cumulative effect the Government employee is never reduced to a lower stage of time scale of pay. Accordingly it was held that clause (iv) of Rule 5 is applicable to the facts of that case. With respect we are unable to agree with the High Court. If the literal interpretation is adopted the learned Judges may be right to arrive at that conclusion. But if the effect is kept at the back of the mind, it would always be so, the result will be the conclusion as we have arrived at. If the reasoning of the High Court is given acceptance, it would empower the disciplinary authority to impose, under the garb of stoppage of increments, of earning future incre- ments in the time scale of pay even permanently with ex- pressly stating so. This preposterous consequences cannot be permitted to be permeated. Rule 5(IV) does not empower the disciplinary authority to impose penalty of withholding increments of pay with cumulative effect except after hold- ing inquiry and following the prescribed procedure. Then the order would be without jurisdiction or authority of law, and it would be per se Page 18 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined void. considering from this angle we have no hesitation to hold that the impugned order would come within the meaning of Rule 5(v) of the Rules; it is a major penalty and imposition of the impugned penalty without enquiry is per se illegal."
9.5.2 It is also fruitful to refer the judgment cited at the bar by learned advocate for the petitioner in the case of Punjab State Electricity Board Now Punjab State Power Corporation Limited (supra), more particularly, paragraphs 11 to 16 are relevant, as under:
"11. At the very outset, we may clearly state there is no discord or dispute over the exposition of facts. The controversy has arisen with regard to implementation of the order of punishment imposed by the authority on the delinquent employee. The courts below have opined that though it is mentioned in the order of punishment that there is stoppage of five increments without cumulative effect which is a minor punishment yet the manner of implementation converts it to a major punishment. There can be no cavil over the proposition that when a punishment of stoppage of an increment with cumulative effect is imposed, it is a major punishment. In this regard, we may refer with profit to the decision in Kulwant Singh Gill v. State of Punjab[1] wherein it has been held that withholding of increments of pay simpliciter without any hedge over it certainly would be a minor punishment but Page 19 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined withholding of increments with cumulative effect, the consequences being quite hazardous to the employee, it would come in the compartment of major punishment. Proceeding further the two Judge Bench stated thus:
"But when penalty was imposed withholding two increments i.e. for two years with cumulative effect, it would indisputably mean that the two increments earned by the employee was cut off as a measure of penalty for ever in his upward march of earning higher scale of pay. In other words the clock is put back to a lower stage in the time scale of pay and on expiry of two years the clock starts working from that stage afresh. The insidious effect of the impugned order, by necessary implication, is that the appellant employee is reduced in his [pic]time scale by two places and it is in perpetuity during the rest of the tenure of his service with a direction that two years' increments would not be counted in his time scale of pay as a measure of penalty. The words are the skin to the language which if peeled off its true colour or its resultant effects would become apparent."
12. After so observing, the Court treated the said punishment to be a major penalty. In said case while interpreting clause (V) of Rule 5 of the same regulations, the Court did not accept the reasoning of the judgment rendered by the Division Bench of the Punjab and Haryana High Court in Sarwan Singh v. State of Punjab and Ors. Page 20 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025
NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined
3. At this juncture, reference to Punjab State & Others v. Ram Lubhaya would be apposite. The High Court has correctly opined as follows:
"Before proceeding further, it will have to be understood as to what is the effect of withholding of increments simpilciter, i.e. without cumulative effect, and with cumulative effect. For example, if an employee is getting Rs.100/- at the time of imposition of penalty of withholding of increments, and the penalty is without cumulative effect for a period of two years and the annual increments were to be of Rs.5, then in that case for two years he will continue to get Rs.100 per month but after the expiry of two years, he will get at the time of next increment, Rs.115, including the increment for the past two years during which period they remained withheld..."
14. In Rangnath Rai v. State of Bihar, the Court while interpreting the withholding of increments with cumulative effect opined that the increments earned by an incumbent were cut off as a measure of penalty forever in his upward march for earning higher scale of pay. The clock is put back to a lower stage in the time scale of pay and on expiry of the punishment period the clock would start working from that stage afresh and, therefore, the effect of stoppage of increment with cumulative effect is that the employee is reduced in his time scale of pay for the period Page 21 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined in question and it is in perpetuity during the rest of the tenure of his service. As the increments that would have earned for those years would not be counted in the time scale of pay as a measure of penalty.
15. The High Court of Delhi in Uttam Kumar v. Delhi Jal Board[5] has laid down the same principle and opined that there is a distinction between the withholding of increment without cumulative effect and withholding of increment with cumulative effect. The former is in the realm of minor penalty and the later is in the compartment of major penalty. In the later one, there is permanent postponement of the increment, whereas in the former one it is for a specified period to be released after expiration of the said period.
16. In our considered opinion the view expressed in the aforesaid decisions is in consonance with the sound legal principle and we approve them."
9.5.3 It is also fruitful to refer the judgment cited at the bar by learned advocate for the petitioner in the case of Dashrathlal Ishwarlal Patel (supra), more particularly, paragraphs 15 to 19, 31 and 34 are relevant, as under:
"15. It is a well-settled position of law that an authority cannot consider the grounds that have not been stated in Page 22 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined the show cause notice and no order can be passed, beyond the scope of the show cause notice.
16. In Janardan Jaishankar Jokharkar v. State of Gujarat reported in 2008(2) GLH 717, this Court has held as below:
"15. On perusal of the record, it is noticed that in the notice dated 12.12.1988, pursuant to which the impugned order has been passed, no allegation about the construction touching the State Highway and/or insufficient margin was mentioned. In absence of any such reference in the notice, the impugned order passed by the Secretary (Appeals) turns into an order beyond the scope of the notice. The authority passing an order of adjudication cannot take into account the grounds or circumstances which are not alleged in the notice and/or in respect of which the petitioner is not put to notice. Otherwise, the very purpose of issuing notice and inviting explanation is frustrated, and going beyond the purview of the Show Cause Notice or taking into account aspects not enumerated in the Show Cause Notice and making them basis for the order also amount to violation of principles of natural justice. When an authority passes an order which is based on grounds or facts not alleged and stated in the notice, then such order results into denial of opportunity of hearing and becomes violative of audi alteram partem rule. In present case, it is obvious that the grounds of insufficient margin and/or the Page 23 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined building touching the State Highway are not mentioned in the Show Cause Notice. Not only this, but even the order of the original and competent authority also does not contain any such finding of fact at his stage in the order dated 11.2.1989. In this view of the matter, it was not permissible for the Secretary (Appeals) to take into consideration aspects which did not form part of the Show Cause Notice and/or which were not reflected in the original order impugned before that authority. The impugned order, on this ground, alone deserves to be set aside."
(emphasis supplied)
17. In Kesarbhai Bhagwanbhai v. State of Gujarat, reported in 1997 (3) GLR 2142, a similar view has been taken by this Court.
18. In Anand D. Lodariya Salt & Storage Pvt. Ltd. & Anr. v. State of Gujarat Through Special Secretary & Ors. (supra), after considering the above judgments, this Court has held as below:
"19. The principles of law enunciated in the above- quoted judgments would squarely apply to the facts of the present case. By passing the impugned order that is undoubtedly beyond the scope of the Show Cause Notice and directing the vesting of the land for breach of conditions, other than condition No.6, for which the Show Cause Notice was issued, there is a flagrant violation of the principles of natural justice. Page 24 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025
NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined The rule of Audi Alteram Partem that enjoins an adequate opportunity of hearing, has been violated by the respondents as the petitioners have not been granted an opportunity of hearing for the alleged breach of the other conditions, not mentioned in the Show Cause Notice.
The findings of respondents Nos.2 and 1 are, therefore, unsustainable in law.
(emphasis supplied)
19. In the present case as well, this Court finds that the order passed by respondent No.2 is beyond the scope of the show cause notice, as it affixes sole responsibility for proper implementation of the NREGA Scheme upon the petitioner, which is not an allegation levelled against him at all, therefore, the petitioner has not been granted an opportunity of hearing to rebut this specific charge. The order passed by respondent No.2, insofar as it fixes sole responsibility for implementation of the NREGA Scheme upon the petitioner, is clearly beyond the scope of the show cause notice.
31. As noted earlier, a finding has been rendered in the impugned order dated 16.05.2012 passed by respondent No.2 that it was the responsibility of the petitioner to ensure that NREGA Scheme is implemented properly and as per the guidelines, and in not doing so the petitioner has failed in his duties as a Sarpanch. This finding is clearly beyond the scope of the show cause notice.
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34. In the present case, not only does the record fail to reveal how the entire responsibility for implementation of the NREGA Scheme lies solely with the petitioner, but it also shows that the technical aspects of the matter such as measurement of the road, use of machinery, etc. were undertaken by the Executive Engineer, Technical Assistant and the Programme Officer who have appended their signatures to the Measurement Book. The order dated 01.06.2009 of the Programme Officer (NREGA) states that it shall be the responsibility of the Talati-cum-Mantri to ensure that the Scheme is properly implemented. The Talati-cum-Mantri has been conveniently saved from further action upon his explanation and the petitioner has been singled out for removal, for reasons best known to the concerned authorities. At the best, the petitioner could have had a general supervisory role in the laying of the road. Even if it is assumed that he failed to supervise the work properly, or to ensure that labourers should be engaged instead of the use of machinery, it would only amount to an irregularity. By no stretch of imagination can it be termed as misconduct or abuse of powers, within the meaning of Section 57(1) of the Act. A single aberration or failure on the part of the petitioner would not invite the exercise of the drastic power contained in Section 57(1) of the Act. Further, there is no whisper of any financial irregularity or pecuniary loss to the Gram Panchayat." 9.5.4 It is also fruitful to refer the judgment cited at the bar by Mr. H.S. Munshaw, learned advocate for Page 26 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined the respondent No.1 in the case of Rajesh Pravinchandra Rajyaguru (supra), more particularly, paragraphs 13.3 to 13.6 are relevant, as under:
"13.3 Even being the daily rated employees working with the Respondent - Board they cannot claim the parity with the employees of the State Government. The Respondent - Board is an autonomous and statutory body created under the Act. It is ultimately for the Respondent - Board to take a conscious decision which can be termed as a policy decision on the pay scales to be adopted and/or certain benefits which would have financial implications. Everything depends upon its economic viability or the financial capacity. As per the settled proposition of law the economic viability or the financial capacity of the employer is an important factor while fixing the wage structure, otherwise the unit itself may not be able to function and may have to close down inevitably and have disastrous consequences for the employees themselves. As per the settled proposition of law the employees cannot legitimately claim that their pay-scales should necessarily be revised and/or they must be granted certain additional benefits/benefits.
13.4 As per the settled proposition of law equation of posts and salary is a complex matter which should be left to the expert body and undertakings and the court cannot interfere lightly. Granting of pay parity by the court may result in a cascading effect having adverse consequences. There are Page 27 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined limitations or qualifications to the applicability of the doctrine of 'equal pay for equal work'.
13.5 Being daily rated employees of the Respondent - Board, they cannot claim as of right similar treatment as Government employees. The Respondent - Board is an independent entity and it might have its own financial capacity and therefore its employees cannot claim parity with the employees of the State Government.
13.6 The State Government and the autonomous Board/bodies cannot be put at par. The Board has to depend upon their own financial resources. In the recent decision in the case of Punjab State Cooperative Milk Producers Federation Limited and Another (Supra) it is observed in paragraph 32 as under:
"32. The Central or State Government is empowered to levy taxes to meet out the expenses of the State. It is always a conscious decision of the Government as to how much taxes have to be levied so as to not cause excessive burden on the citizens. But the Boards and Corporations have to depend on either their own resources or seek grant from the Central/ State Government, as the case may be, for their expenditures. Therefore, the grant of benefits of higher pay scale to the Central/State Government employees stand on different footing than grant of pay scale by an instrumentality of the State."
Therefore, the daily rated employees of the Board Page 28 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined cannot as a matter of right claim the parity of pay scales with the Government employees." 9.5.5 It is also fruitful to refer the judgment cited at the bar by Mr. H.S. Munshaw, learned advocate for the respondent No.1 of Co-ordinate Bench of this Court rendered in Special Civil Application No.6626 of 2017 28.09.2017, more particularly, paragraphs 3, 4.1 and 4.2 are relevant, as under:
"3. Mr. Naidu, learned advocate for the petitioner - employer has submitted that, since there was misconduct on the part of the respondent, show-cause notice was issued to him on 12.05.2012, which is on record at Annexure - B. It is submitted that reply was given by the respondent to it on 30.05.2012, which is on record at Annexure - C. It is submitted that on the basis of the narration in the show- cause and the reply of the workman, the Deputy Municipal Commissioner passed an order on 10.07.2012, holding that the misconduct was committed by the respondent - workman, however this was not the case where any major punishment 4.1 The subject matter before the Tribunal was the punishment order of withholding of one increment with future effect. The Reference was made before the Tribunal under section 10 (1) of the Industrial Disputes Act. This was not the case of removal or dismissal and therefore the Page 29 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined Tribunal was not exercising the power under section 11A of the Industrial Disputes Act. It is not even the reason recorded by the Tribunal.
4.2 The Tribunal has set aside the punishment order on the ground that there was breach of principles of natural justice. The petitioner is a Municipal Corporation. It has its own regulations. It inter-alia stipulates that, in the case of punishment of withholding of increment etc., full fledged departmental inquiry by appointing inquiry officer is not required and it would be sufficient, if written show-cause notice is given to the concerned workman. In the present case, it is not in dispute that, show-cause notice in writing was given to the respondent on 12.05.2012. He had responded also to the same on 30.05.2012. The ultimate punishment is withholding of increment. In the facts of this case, this Court finds that, this could not be termed to be in breach of principles of natural justice. The Tribunal fell in error in coming to the conclusion, in the facts of this case, that the impugned punishment order was in breach of principles of natural justice. The finding recorded by the Tribunal is thus unsustainable, in these facts, and the same needs to be quashed and set aside"
9.5.6 It is also fruitful to refer the judgment cited at the bar by Mr. H.S. Munshaw, learned advocate for the respondent No.1 of the Division Bench of this Court rendered in Letters Patent Appeal No.82 of 2020 in Page 30 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined Special Civil Application No.16470 of 2018, more particularly, paragraphs 18 and 21 are relevant, as under:
"[18] From the overall circumstances, which are visible from the record, we see that there is a discretion left with the Board either to apply the pay scale or not depending upon its own policy and the said view has been confirmed in the earlier proceedings as stated above and we see that the learned Single Judge has committed an error in just observing that when parent policy in the form of Government resolution dated 17.10.1988 is adopted, the other attendant resolutions are to be applied automatically which reason sounds an irregularity. Additionally, while going through the decision delivered by the learned Single Judge much emphasis appears to have been given on the stand of original petitioner that other similarly situated nine employees have been extended such benefits. But we have seen from the record that by way of corrective measure, the Board has initiated proceedings of withdrawal of such pay scale and steps have been effectively taken and as such, we see no reason to allow the original petitioner to claim the said benefit by way of negative equality as has been pointed out earlier even now the Government has also in clear terms taken a decision not to extend such benefit and if extended take corrective measure, we see no reason to allow the conclusion arrived at by the learned Single Judge to stand in the eye of law. The attending circumstance, reflecting from the record, is giving an impression in clear terms that there shall be no Page 31 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined automatic application of the other subsequent resolutions issued for various departments in the government unless specifically applied by mandate and by the Board, being a statutory body, is free to take its own decision in respect of this particular pay scale.
[21] In view of aforesaid circumstances, we are of the clear opinion that concept of negative equality is not recognized in the law, but at the same time, once mistake is committed, the same cannot be allowed to be perpetuated and the said view is well recognized by the decision cited before us by the learned advocate for the appellant - Board and since we are not in conflict with the observations, we deem it proper not to incorporate the observation of the said decisions just to avoid unnecessary burden of the present order and as such in close conformity with the said proposition of law laid down by the decision delivered by the Apex Court, we see that this is a fit case in which the appeal of the appellant - Board is allowed and the original petitioner's stand is not possible to be accepted unless and until there is a specific challenge to the decision of the Board. We also do not recognize this omnibus prayer which is made in the petition. Resultantly, the order passed by the learned Single Judge is hereby quashed and set aside. The appeal stands allowed."
9.6 Considering the above-mentioned position of law, whereby the strict rule like the BCSR cannot be Page 32 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined applicable to the corporation and boards like the present Municipal Corporation. The Co-ordinate Bench of this Court has already considered this aspect in Special Civil Application No.6626 of 2017 that once show cause notice in writing was given to the concerned workman and he has also responded to the same, and ultimate punishment was found withholding the increments, the Court has found that this could not be termed as breach of principles of natural justice.
9.7 It cannot be said that there is any quarrel regarding the ratio of the judgments cited at the bar by the respective parties, more particularly, by the petitioner but in the facts and circumstances of the present case, the issue is broadly covered by the judgment of Co- ordinate Bench of this Court rendered in Special Civil Application No.6626 of 2017 28.09.2017 as indicated above, and otherwise also, the scope of judicial review in such matter where procedure is broadly followed by the Authority as per the such provisions of Rules of the respective organization, the scope of interference of the Court is very narrow. In the present case, I found that there is no illegality or arbitrariness in the action of the Page 33 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025 NEUTRAL CITATION C/SCA/11289/2016 JUDGMENT DATED: 14/07/2025 undefined respondent Authority in imposing such penalty and, therefore, I found no merit in the present petitions and, hence, the present petitions are required to be dismissed.
10. In view of the above observations, the present petitions are dismissed with no order as to costs. Rule stands discharged. Interim relief, if any, granted earlier stands vacated.
(SANDEEP N. BHATT,J) DIWAKAR SHUKLA Page 34 of 34 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Jul 17 2025 Downloaded on : Thu Jul 17 21:51:36 IST 2025