Central Administrative Tribunal - Delhi
Shri Prabhu Lal vs Union Of India on 24 November, 2009
CENTRAL ADMINISTRATIVE TRIBUNAL PRINCIPAL BENCH OA No.264/2009 MA No.1681/2009 New Delhi, this the 24th day of November, 2009 HONBLE MR. JUSTICE V.K.BALI, CHAIRMAN HONBLE MR. L.K.JOSHI, VICE CHAIRMAN (A) Shri Prabhu Lal, Son of Late Shri Puran Ram, R/o 4/171, Lalita Park, Laxmi Nagar, Delhi-110092 Applicant (Through Shri Sarvesh Bisaria, Advocate) Versus 1. Union of India, through The Secretary (Revenue), Ministry of Finance, North Block, New Delhi 2. The Chief Commissioner of Income Tax, C.R. Building, I.T.O., New Delhi Respondents (Through Shri V.P. Uppal, Respondent) ORDER
Mr. L.K. Joshi, Vice Chairman (A) The Applicant, Shri Prabhu Dayal, who retired on superannuation as Income Tax Officer (ITO) on 28.02.2007, is aggrieved that his dues on retirement, i.e., gratuity, commutation of pension and regular pension have been withheld owing to pendency of a criminal case against the Applicant, which is on account of some personal dispute and has nothing to do with the performance of his official duties, while in service.
2. The Applicant had earlier approached this Tribunal through OA number 2563/2008 for the same cause of action. In its order dated 26.11.2008 the Tribunal directed the Respondents to consider the case of the Applicant by treating the aforesaid OA as representation and pass a speaking and reasoned order regarding the issues raised by the Applicant. The second Respondent rejected the Applicants plea for releasing his gratuity and commuted value of pension etc. by observing thus:
In pursuance of this order of Honble Tribunal the office of CCIT, Delhi has sought clearance from the Dy. CVO, i.e. Director of Income-tax (Vig)/North Zone, Delhi who is the Competent Authority to issue vigilance clearance in respect of Group `B officers. The Director of Income-tax (Vig)/North Zone has conveyed vide his letter dated 23/12/2008 that a criminal proceedings is pending against Shri Prabhu Lal before the Honble Metropolitan Magistrate, Court No. 18, East District, Karkardooma Courts and the case is fixed for 14/04/2009. Since a judicial proceeding is pending against Shri Prabhu Lal, ITO and vigilance clearance has not been issued by the Competent Authority, retirement benefits i.e. gratuity and commutation of pension/regular pension cannot be released to him at this stage.
Keeping in view of the provision of section 69 of the CCS (Pension) Rules the retirement benefits such as Gratuity, Commutation of Pension/ regular pension shall be released on conclusion of judicial proceedings pending before the Honble Metropolitan Magistrate and receipt of vigilance clearance from the Competent Authority.
3. The learned counsel for the Applicant has raised the contention that under Rule 69 of the CCS (Pension) Rules, 1972, read with Rule 9 ibid, the pension related dues of the Applicant could be withheld only if the judicial proceedings related to matters in the discharge of his official duties. It is contended that an FIR was lodged in police station Shakarpur on 22.02.2005 by one Shri Vijender Kumar against the Applicant, his wife and his son for beating the complainant. The FIR was registered under sections 325/34 of the IPC. The Applicant had also lodged a cross FIR number 59/2008 against Shri Vijender Kumar under Section 3 of the SC/ST (Prevention of Atrocities) Act of 1989. Dispute is personal in nature and does not involve any gross misconduct or negligence. Reliance has been placed on D.V. Kapoor Vs. Union of India and others, AIR 1990 SC 1923. The learned counsel would further contend that the payment of gratuity is governed by the Payment of Gratuity Act, 1972 and gratuity can only be withheld under sub section (6) of the Section 4 of the aforesaid Act.
4. The learned counsel for the Respondents, on the other hand, would contend that under CCS (CCA) Rules, there is no distinction between conviction whether in a case of personal dispute or in the performance of official duties. Conviction in a Court is treated as a misconduct as per the decision number 23 of the Government of India below Rule 3 of the CCS (Conduct) Rules, 1964. Respondents have cited the judgement of Honourable Supreme Court in R. Veerabhadram Vs. Govt. of A.P., (1999) 9 SCC 43 in support of their proposition.
5. Rule 69 of the CCS (Pension) Rules reads thus:
69. Provisional pension where departmental or judicial proceedings may be pending (1)(a) In respect of a Government servant referred to in sub-rule (4) of Rule 9, the Accounts Officer shall authorize the provisional pension equal to the maximum pension which would have been admissible on the basis of qualifying service up to the date of retirement of the Government servant, or if he was under suspension on the date of retirement up to the date immediately preceding the date on which he was placed under suspension.
(b) The provisional pension shall be authorized by the Accounts Officer during the period commencing from the date of retirement up to and including the date on which, after the conclusion of departmental or judicial proceedings, final orders are passed by the Competent Authority.
(c) No gratuity shall be paid to the Government servant until the conclusion of the departmental or judicial proceedings and issue of final orders thereon:
Provided that where departmental proceedings have been instituted under Rule 16 of the Central Civil Services (Classification, Control and Appeal) Rules, 1965, for imposing any of the penalties specified in Clauses (i), (ii) and (iv) of Rule 11 of the said rules, the payment of gratuity shall be authorized to be paid to the Government servant.
(2) Payment of provisional pension made under sub-rule (1) shall be adjusted against final retirement benefits sanctioned to such Government servant upon conclusion of such proceedings but no recovery shall be made where the pension finally sanctioned is less than the provisional pension or the pension is reduced or withheld either permanently or for a specified period. Decision 23 of the Government of India under Rule 3 of the CCS (Conduct) Rules, 1964 gives a list of `acts and conducts which amount to misconduct. This has been reproduced in Swamys Compilation of Conduct Rules, Thirty Seventh Edition, 2007, Pages 33 to 34. It is, inter alia, states thus:
The following acts and omission amount to misconduct .. .. .. ..
(9) conviction by a criminal Court. Rule 8 of the CCS (Pension) Rules, 1972 provides that pension is subject to future good conduct. Rule 8, ibid, is extracted below:
8. Pension subject to future good conduct (1)( (a) Future good conduct shall be an implied condition of every grant of pension and its continuance under these rules.
(b) The Appointing Authority may, by order in writing, withhold or withdraw a pension or a part thereof, whether permanently or for a specified period, if the pensioner is convicted of a serious crime or is found guilty of grave misconduct:
Provided that, where a part of pension is withheld or withdrawn, the amount of such pension shall not be reduced below the amount of rupees three hundred and seventy-five (Rupees One thousand nine hundred and thirteen from 1-4-2004 see GID below Rule 49) per mensem.
(2) Where a pensioner is convicted of a serious crime by a Court of Law, action under sub-rule (1) shall be taken in the light of the judgment of the Court relating to such conviction.
(3) In a case not falling under sub-rule (2), if the authority referred to in sub-rule (1) considers that the pensioner is prima facie guilty of grave misconduct, it shall before passing an order under sub-rule (1),
(a) serve upon the pensioner a notice specifying the action proposed to be taken against him and the ground on which it is proposed to be taken and calling upon him to submit, within fifteen days of the receipt of the notice or such further time not exceeding fifteen days as may be allowed by the Appointing Authority such representation as he may wish to make against the proposal; and
(b) take into consideration the representation, if any, submitted by the pensioner under Clause (a).
(4) Where the authority competent to pass an order under sub-rule (1) is the President, the Union Public Service Commission shall be consulted before the order is passed.
(5) An appeal against an order under sub-rule (1), passed by any authority other than the President, shall lie to the President and the President shall, in consultation with the Union Public Service Commission, pass such orders on the appeal as he deems fit, EXPLANATION In this rule, -
(a) the expression `serious crime includes a crime involving an offence under the Official Secrets Act, 1923 (19 of 1923);
(b) the expression `grave misconduct includes the communication or disclosure of any secret official code or password or any sketch, plan, model, article, note, document or information, such as is mentioned in Section 5 of the Official Secrets Act, 1923 (19 of 1923), (which was obtained while holding office under the Government) so as to prejudicially affect the interests of the general public or the security of the State. The decisions 1 and 3 of the Government of India under Rule 8 have been reproduced below:
(1) Stoppage or reduction of pension for reasons other than misconduct not permissible Pensions are not in the nature of reward but there is a binding obligation on Government which can be claimed as a right. Their forfeiture is only on resignation, removal or dismissal from service. After a pension is sanctioned, its continuance depends on future good conduct vide Article 351, CSR [Rule 8, CCS (Pension) Rules, 1972] but it cannot be stopped or reduced for other reasons.
.. .. ..
(3) Intimation of cases of convicted pensioners Under Article 351, CSR [Rule 8, CCS (Pension) Rules, 1972], future good conduct is an implied condition of the grant of every pension and Government has the right to withhold or withdraw a pension or any part of it if the pensioner is convicted of a serious crime or found guilty of grave misconduct. It is, therefore, necessary to ensure that cases where pensioners are convicted by a Court of any crime are also brought to the notice of Government. The Government of India, Ministry of Home Affairs, therefore, request that if the State Government have no objection, instructions may kindly be issued to prosecuting officers under the control of the State Government to ensure the prompt intimation of such cases to the administrative authorities concerned in future. [Source: Swamys compilation of CCS (Pension) Rules, 18th Edition, 2007, Page 8] Rule 9 of the CCS (Pension) Rules is extracted below:
9. Right of President to withhold or withdraw pension [(1) The President reserves to himself the right of withholding a pension or gratuity, or both, either in full or in part, or withdrawing a pension in full or in part, whether permanently or for a specified period, and of ordering recovery from a pension or gratuity of the whole or part of any pecuniary loss caused to the Government, if, in any departmental or judicial proceedings, the pensioner is found guilty of grave misconduct or negligence during the period of service, including service rendered upon re-employment after retirement:
Provided that the Union Public Service Commission shall be consulted before any final orders are passed:
Provided further that where a part of pension is withheld or withdrawn, the amount of such pensions shall not be reduced below the amount of rupees three hundred and seventy-five.
6. The scope of Rule 9 has been inquired into by the Honourable Supreme Court in D.V. Kapoor (supra). D.V. Kapoor was Assistant grade IV of the Indian Foreign Service in Indian High Commission in London. On the expiry of his tenure in London, he could not return to India immediately due to the illness of his wife. Disciplinary proceedings were initiated against D.V. Kapoor for unauthorized absence. The inquiry officer held that D.V. Kapoors absence was not wilful. During the course of the inquiry, the Charged Officer had retired from service. The President, in consultation with the Union Public Service Commission, decided to withhold the entire pension and gratuity permanently. The Honourable Supreme Court observed thus:
4. At page 190-D (of SCR) : (at p. 140, para 36 of AIR) it is stated that pension as a retirement benefit is in consonance with and furtherance of the goals of the Constitution. The goals for which pension is paid themselves give a fillip and push to the policy of setting up a welfare State because by pension the socialist goal of security from cradle to grave is assured at least when it is mostly needed and least available, namely in the fall of life. Therefore, when a Government employee is sought to be deprived of his pensionary right when he had earned while rendering services under the State, such a deprivation must be in accordance with law. Rule 9(l) of the rules provides thus:-
"The President reserves to himself the right of withholding or withdrawing a pension or part thereof, whether permanently or for a specified period, and of ordering recovery from a pension of the whole or part of any pecuniary loss caused to the Government, if, in any departmental or judicial Proceedings, the pensioner is found guilty of grave misconduct or negligence during the period of his service including service rendered upon reemployment after retirement.
Provided that the Union Public Service Commission shall be consulted before any final orders are passed.
Provided further that where a part of pension is withheld or withdrawn, the amount of such pension shall not be reduced below the amount of rupees sixty per mensem. Therefore, it is clear that the President reserves to himself the right to withhold or withdraw the whole pension or a part thereof whether permanently or for specified period. The President also is empowered to order recovery from a pensioner of the whole or part of any pecuniary loss caused to the Government, if in any, proceeding in the departmental enquiry or judicial proceedings, the pensioner is found guilty of grave misconduct or negligence during the period of his service including service rendered upon reemployment after retirement.
Rule 8(5), explanation (b) defines 'grave misconduct' thus :-
"The expression 'grave misconduct' includes the communication or disclosure of any secret official code or password or any sketch, plan, model, article, note, document or information, such as is mentioned in Section 5 of the Official Secrets Act, 1923 (19 of 1923) (which was obtained while holding office under the Government) so as to prejudicially affect the interests of the general public or the security of the State."
In one of the decisions of the Government as compiled by Swamy's Pension Compilation, 1987 Edition, it is stated that:-
"Pensions are not in the nature of reward but there is a binding obligation on Government which can be claimed as a right. Their forfeiture is only on resignation, removal or dismissal from service. After a pension is sanctioned its continuance depends on future good conduct, but it cannot be stopped or reduced for other reasons."
5. It is seen that the President has reserved to himself the right to withhold pension in whole or in part thereof whether permanently or for a specified period or he can recover from pension of the whole or part of any pecuniary loss caused by the Government employee to the Government subject to the minimum. The condition precedent is that in any departmental enquiry or the judicial proceedings, the pensioner is found guilty of grave misconduct or negligence during the period of his service of the original or on re-employment. The condition precedent thereto is that there should be a finding that the delinquent is guilty of grave misconduct or negligence in the discharge of public duty in office, as defined in Rule 8(5), explanation (b) which is an inclusive definition, i.e. the scope is wide of mark dependent on the facts or circumstances in a given case. Myriad situation may arise depending on the ingenuity with which misconduct or irregularity was committed. It is not necessary to further probe into the scope and meaning of the words 'grave misconduct or negligence' and under what circumstances the findings in this regard are held proved. It is suffice that charges in the case are that the appellant was guilty of wilful misconduct in not reporting to duty after his transfer from Indian High Commission at London to the Office of External Affairs Ministry, Government of India, New Delhi. The Inquiry Officer found that though the appellant derelicted his duty to report to duty, it is not wilful for the reasons that he could not move due to his wife's illness and he recommended to sympathetically consider the case of the appellant and the President accepted this finding, but decided to withhold gratuity and payment of pension in consultation with the Union public Service Commission.
6. As seen the exercise of power by the President is hedged with a condition precedent that a finding should be recorded either in departmental enquiry or judicial proceedings that the pensioner committed grave misconduct or negligence in the discharge of his duty while in office, subject of the charge. In the absence of such a finding the President is without authority of law to impose penalty of withholding pension as a measure of punishment either in whole or in part permanently or for a specified period, or to order recovery of the pecuniary loss in whole or in part from the pension of the employee, subject to minimum of Rs.60.
7. Rule 9 of the rules empowers the President only to withhold or withdraw pension permanently or for a specified period in whole or in part or to order recovery of pecuniary loss caused to the State in whole or in part subject to minimum. The employee's right to pension is a statutory right. The measure of deprivation therefore, must he correlative to or commensurate with the gravity of the grave misconduct or irregularity as it offends the right to assistance at the evening of his life as assured under Art. 41 of the Constitution. The impugned order discloses that the President withheld on permanent basis the payment of gratuity in addition to pension. The right to gratuity is also a statutory right. The appellant was not charged with nor was given an opportunity that his gratuity would be withheld as a measure of punishment. No provision of law has been brought to our notice under which, the President is empowered to withhold gratuity as well, after his retirement as a measure of punishment. Therefore, the order to withhold the gratuity as a measure of penalty is obviously illegal and is devoid of jurisdiction.
8. In view of the above facts and law that there is no finding that appellant did commit grave misconduct as charged for, the exercise of the power is clearly illegal and in excess of jurisdiction as the condition precedent, grave misconduct was not proved. Accordingly the appeal is allowed and the impugned order dated November 24, 1981 is quashed but in the circumstances parties are directed to bear their own costs. The ratio in the judgement is that grave misconduct should be in the discharge of public duty in office. The criminal case against the Applicant herein would not come within the ambit of grave misconduct in the discharge of public duty in office.
7. Relevant portion of Sub-section 1 of Section 4 of the Payment of Gratuity Act, 1972 (hereafter the Act) reads thus:
4. Payment of gratuity (1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years on his superannuation, or on his retirement or resignation, or on his death or disablement due to accident or disease. The Sub-Section 6 is the non obstante section:
(6) Notwithstanding anything contained in sub-section (1), -
the gratuity of an employee, whose services have been terminated for any act, wilful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be forfeited to the extent of the damage or loss so caused;
the gratuity payable to an employee [may be wholly or partially forfeited]-
if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment. The judicial proceedings against the Applicant would not be governed by the Section 4 (6) of the Act. The facts in R. Veerabhadram (supra) relied on by the Respondents are distinguishable from the facts of the instant case. R. Veerabhadram was Deputy Secretary in the Government of Andhra Pradesh. The Anti Corruption Bureau of the State Government registered a case against the appellant before the Honourable Supreme Court. He was placed under suspension and retired on attaining the age of superannuation. The Applicant approached State Administrative Tribunal. The State Tribunal held that the said R. Veerabhadram would be paid provisional pension but death-cum-retirement gratuity shall not be paid to him till the judicial proceedings are completed. Rule 52 (1) (c) of the A.P. Revised Pension Rules, 1980 specifically provided that no gratuity shall be payable to a government employee until the conclusion of departmental or judicial proceedings. The Honourable Supreme Court held the order of withholding of gratuity to be valid in view of the express provision in the A.P. Revised Pension Rules. In this case the judicial proceedings were under the Prevention of Corruption Act, 1947. Under this Act the cognizance of corruption in the discharge of official duties is taken. The case is filed by an agency of the Government and not by an individual. There is an express provision in the aforementioned Act for withholding of gratuity. In a similar case Rajendra Kumar Nangia Vs. Rashtriya Chemicals and Fertilizers Limited, 2002-I-LLJ-94, the Honourable High Court of Bombay held thus:
4. It would be seen that sub-section (1) of Section 4 of the Payment of Gratuity Act, 1972 provides that gratuity shall be payable to an employee on termination of his employment after he has rendered continuous service for not less than five years. The termination of the employment may be on superannuation or on retirement or resignation or death or disablement due to accident or disease of the employee. Thus, an employee becomes entitled to payment of gratuity under the statute. Sub-section 6 is an exception to sub-section (1) and makes a provision of forfeiture of the gratuity wholly or partially in the circumstances mentioned therein. According to sub-section (6), gratuity of an employee may be forfeited to the extent of damage or loss caused to the employer if service of that employee has been terminated for any act, wilful omission or negligence on that ground. The gratuity payable to an employee may also be forfeited wholly or partially if the service of such employee has been terminated for his riotous or disorderly conduct or any other act of violence on his part or service of such employee has been terminated for any act constituting an offence involving moral turpitude. Though a criminal case was registered against the Petitioner by CBI in the year 1993, the fact is petitioners services have been terminated simpliciter on his superannuation and not for any of the grounds mentioned under sub-section (6) of Section 4 of the Payment Gratuity Act, 1972. As a matter of fact, admittedly till Petitioners superannuation and even till date no departmental proceedings of misconduct have been initiated against the Petitioner. In this backdrop of facts, it was not open to the Respondents to refuse to release the gratuity amount to the Petitioner.
5. The learned counsel for respondents heavily relied on the judgment of the Apex Court in Jarnail Singh v. Secretary, Ministry of Home Affairs & Ors., AIR 1994 SC 1484 : 1993 (1) SCC 47 : 1993-I-LLJ-962 in support of his contention that gratuity can be withheld by the employer-Respondents if any judicial proceedings are pending against the Petitioner relating to his misconduct or negligence during the period of his service. We are afraid the judgment of the Apex Court in Jarnail Singh (supra) has no application in the facts and circumstances of the case before us. The Apex Court in the case of Jarnail Singh (supra) was concerned with the provisions of Central Civi1 Services (Pension) Rules, 1972 and in the light of the specific Rules 3, 6, 69 (1) (c), 71 and 73 held that there was nothing wrong in the order of the President in withholding the gratuity of the employee. In the present case, none of the Rules under consideration before the Apex Court or the similar Rules are applicable but the Petitioner is governed by the provisions of the Payment of Gratuity Act, 1972 and as per Section 4 (1) Petitioner has a statutory right to receive gratuity from his employer save and except in the circumstances provided under sub-section (6) of Section 4. We have already indicated that none of the circumstances provided in sub-section (6) is applicable in the present case and, therefore, we do not find any justifiable cause on the part of the Respondents in withholding the gratuity. Mere pendency of a criminal case lodged by CBI shall not disentitle the petitioner from receiving gratuity nor shall entitle the Respondents to not to release the gratuity to the Petitioner as Petitioners services came to an end on his attaining superannuation simpliciter. We may note here that Rule 45 of the RCF Employees (Conduct, Discipline & Appeal) Rules, 1993 does provide for departmental action against retired employees. Clause (iii) of Rule 45 provides that in case of an officer who has already retired on superannuation before instituting any departmental proceedings and who has received all retrial benefits, as far as possible only criminal prosecution can be recommended against him. Even under Clause (ii) of Rule 45, it appears that now no departmental action can be initiated against the present Petitioner as it provides that if departmental proceedings had not been instituted while the officer was in service, proceedings under Rule 38 for imposition of major penalties can be initiated only by or sanction of the Board of Directors and in respect of a cause of action which arose or in respect of an offence which took place not earlier than four years before the institution of the proceedings. The Petitioner was superannuated in the year 1994; the criminal case was registered against him in the year 1995 before his superannuation but till date i.e. more than seven years of his superannuation, no departmental action has been initiated and, therefore, such action has become beyond time provided in Clause (ii) of Rule 45 of the RCF Employees (Conduct, Discipline & Appeal) Rules, 1993.
6. For all these reasons, we are satisfied that the decisions taken by Respondents to not to release payment of gratuity to the Petitioner cannot be sustained.
8. From the above, it would emerge thus:
(i) Action cannot be taken against the Applicant under Rule 9 of the CCS (Pension) Rules in view of the ratio laid down by the Honourable Supreme Court that the misconduct has to be in the discharge of public duty in office. In this matter, the criminal case against the Applicant has not been filed in the discharge of his duty in the office.
(ii) In view of decision 23 under Rule 3 of the CCS (Conduct) Rules, 1964, conviction by a criminal Court would amount to misconduct. If the Applicant is convicted in the criminal case, which is pending against him, it would amount to misconduct.
(iii) The Applicant would be covered under Rule 8 of CCS (Pension) Rules, which has been quoted in full in the preceding paragraph. Under this rule, the appointing authority has been given the authority to withhold or withdraw pension or a part thereof, if the pensioner is convicted of a serious crime or is found guilty of grave misconduct. Sub-rule (2) of Rule 8 further elucidates that action will be taken against the pensioner in the light of the judgement of the Court relating to such conviction.
(iv) Gratuity cannot be withheld under Rule 8 of CCS (Pension) Rules, 1972 unlike the provision in Rule 9 ibid. Otherwise also as per the provision in Section 4 of the Payment of Gratuity Act, 1972, gratuity cannot be withheld.
It is clear, therefore, that pension can be withheld or withdrawn only after conviction in a serious crime and that too on the basis of the judgement of the Court relating to such conviction.
9. In the case of the Applicant, there is a criminal case pending against him in the Court of Law. However, so far there has been no decision in the case pending against the Applicant. In the light of the above, it would be amply clear that only on the basis of the case pending against the Applicant, pension cannot be withheld under Rule 8 of CCS (Pension) Rules, 1972. It has to abide by the final decision in the criminal case against the Applicant. Gratuity cannot, in any case, be withheld or withdrawn under the provisions of Rule 8 ibid.
10. In the light of the analysis as above, the OA succeeds. The Respondents are directed to release the regular pension, commuted amount of pension and gratuity to the Applicant with 8 per cent simple interest per annum from the date the payment was due, within eight weeks from the receipt of a copy of this order. The Respondents, however, would be free to take action against the Applicant subject to the provisions of Rule 8 of CCS (Pension) Rules, 1972, as discussed above. No costs.
( L.K. Joshi ) ( V.K. Bali ) Vice Chairman (A) Chairman /dkm/