Roop Singh vs Central Excise &Amp; Customs on 8 May, 2018

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Central Administrative Tribunal - Chandigarh

Roop Singh vs Central Excise &Amp; Customs on 8 May, 2018

1. As identical questions of law and facts are involved, so we propose to dispose of all the above captioned Original Applications (OAs), by means of this common decision, in order to avoid the repetition of facts and as also so acknowledged by the learned counsel for the parties.

2. The challenge in the instant petitions, is to the impugned orders dated 14.03.2017 (Annexure A-1 colly), by virtue of which the benefit of 3rd financial upgradation granted to the applicants, has been withdrawn, and consequential impugned recovery has been ordered by the Competent Authority.

3. The epitome of the facts and material, which needs a necessary mention, for the limited purpose of deciding the core controversy, involved in the present OAs, and emanating from the record, is that the applicants in 1st case were initially appointed between 1982 to 1984 as Inspector in Central Excise and Service Tax. They were promoted, firstly, on the post of Superintendent, between 1997 to 2002, and further promoted on the post of Assistant Commissioner on 22.10.2014, by the Competent

-5- O.A. No. 060/00335/2017 & connected matters Authority. The applicants in remaining connected cases were also promoted in the same fashion.

4. The case set up by the applicants, in brief, insofar as relevant, is that during the course of their service, the benefits of Assured Career Progression (ACP) Scheme were granted to them, on completion of 24 years of service, in the pre-revised scale. In the wake of recommendations of 6th Pay Commission, in respect of Group B Officers, the Department of Expenditure passed a resolution dated 29.08.2008 to the effect that Group B officers of Department of Posts and Revenue will be granted grade pay of Rs.5400/- in the pay band-II w.e.f. 01.01.2006 on non-functional basis, after 4 years of regular service in the grade pay of Rs.4800/- in Pay band-2.

5. As such, all the applicants were granted Non-Functional Grade (NFG), after completion of four years of regular service on 01.01.2006, on the recommendations of 6th Pay Commission. Subsequently, the ACP Scheme was modified, and a new scheme called Modified Assured Career Progression (for brevity MACP) Scheme was made effective from 01.09.2008, by virtue of which the number of financial upgradations to be granted were increased to three and that, too, after every 10 years of service. It was alleged that on completion of requisite 30 years of service, they were granted 3rd financial upgradation, in the grade pay of Rs.6600/- under MACP Scheme, in pursuance of O.M. dated 19.05.2009 (Annexure A-2). Thereafter, all the applicants were enjoying the benefit of 3rd financial upgradation to the grade pay of Rs.6600/-, in the pay band of Rs.15600-39100 (PB-3), under the MACP Scheme.

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6. According to the applicants, that now all of a sudden, the Competent Authority, without issuing any Show Cause Notice (for brevity, SCN), or providing an opportunity of being heard, and without assigning any cogent reasons, has withdrawn the benefit of 3rd financial upgradation, granted to them, vide impugned order dated 14.03.2017 (Annexure A-1 colly).

7. Aggrieved thereby, the applicants in 1st case have challenged the validity of the impugned order, on the following grounds:-

"a) That the impugned order dated 14.03.2017 is per se, illegal, arbitrary and unjustified, in view of the judgment delivered by the Hon‟ble High Court of Madras in Writ Petition No. 19024 of 2014 (R. Chandrasekaran V/S CAT & Ors).

b) That the impugned order dated 14.03.2017 is also not legally sustainable as in the present case the grant of next financial upgradation under MACP cannot be simply offset against the benefit of non functional grade of Rs.5400 granted prior to 01.09.2008 under ACP scheme. This self contradictory stand of the respondents had been objected to by the Hon‟ble High Court of Madras in WP No. 19024/2014 and held contrary by the Hon‟ble High Court, cannot now be a hindrance in allowing the benefit of R. Chandrasekaran case to all similar placed persons in the Department of Revenue. "

c) That the impugned order dated 14.03.2017 is not legally sustainable in the eyes of law in as much as the denial of the benefit of the R. Chandrasekaran‟s case to all the similarly placed persons, amounts to violation of Article 14 of the Constitution of India.

d) That the impugned order dated 14.03.2017 is not legally sustainable in the eyes of law in as much as in another O.A. No. 1751/2014 and O.A. No. 210/2016 (Mr. S. Purushothaman & Ors V/S Union of India through CBDT 7 Ors) Chennai Bench of the Hon‟ble Tribunal has reaffirmed and followed the decision of R. Chandrasekaran‟s case and accordingly directed the respondents to extend the benefits of the judgment.

e) That the impugned order dated 14.03.2017 is not legally sustainable in the eyes of law in as much as in the case of UOI & Ors V/S S. Balakrishnan & Ors (WP No. 11535/2014 decided by the Madras High Court) the Hon‟ble High Court quoting Supreme Court in Prabhudas Damodar Kotecha V/S Manhabal Jeram Damodr (2013) 10 Scale 242 observed that while interpreting the provisions of the Statute, the statements of objects and reasons are also relevant.

f) That the impugned order dated 14.03.2017 is not legally sustainable in the eyes of law in as much as the respondents have acted in violation of principle of natural justice as they have not considered any of the representations of the applicants nor any opportunity of being heard was given to the applicants before passing the impugned order.

g) That while passing the impugned order dated 14.03.2017, the official respondents have totally ignored the verdict given by the Hon‟ble High Court of Madras in WP No. 19024/2014 and M.P. No. 1/2014 filed by Sh. R. Chandrasekaran and has further ignored the verdict of the Hon‟ble Madras High Court and delivered in Union of India V/S S. Balakrishnan, which has been affirmed by the Hon‟ble Supreme Court of India in dismissing the SLP of the respondents, in these circumstances, the very genesis on the basis of which the impugned order dated 14.03.2017 has been passed, is liable to be quashed and set aside.

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     h)     That the impugned order dated 14.03.2017 is not legally

sustainable in the eyes of law in as much as there are catena of judgments by the Hon‟ble Supreme Court which clearly postulate that in case if any grade pay is given to an incumbent and it was on account of the scheme in force in existence and there had been no concealment on account of the applicants, in that eventuality by no stretch of imagination any recovery can be made from the salary of an incumbent detrimental to the interests and reliance in this connection is being placed on the judgments reported as 2008 (7) SLR 642 Syed Abdul Kadir V/S State of Bihar & Civil Appeal No. 11527/2014 State of Punjab & Ors V/S Rafiq Masih (White Washer) etc. decided on 18.12.2014, could have been examined by the official respondents while passing impugned order dated 14.03.2017. It is pertinent to mention here that respondent has not only violated the parameters laid down in the civil Appeal No. 11527/2014 State of Punjab & Ors V/S Rafiq Masih but also committed contempt of the court when some of the applicants have retired and are about to retire within one year.

i) That the impugned order dated 14.03.2017 is not legally sustainable in the eyes of law because it is a settled proposition of law that no civil vested right of any employee can be taken away by the employer without granting due opportunity of hearing. In the instant case after granting the benefits of 3rd financial upgradation under MACP on completion of 30 years service, all the applicants have been drawing their pay in the grade pay of Rs. 6600/- as the case may be, thus a vested right accrued in their favour which cannot be snatched in arbitrary manner without affording opportunity of hearing to the applicants. Hence the impugned order dated 14.03.2017 has been passed contrary to the principles of natural justice and the same is liable to be quashed and set aside.

j) That the DOPT is the Nodal agency to provide for any interpretation/clarification of doubt as to the scope and meaning of the provisions of MACP Scheme and the DOPT has nowhere said in the MACP scheme or any other clarification that Non functional grade granted during ACP scheme would be counted as financial upgradation. The Respondent department is making wrong interpretation of the scheme and it is the domain of the DOPT, the respondent department is just a post office to implement the instructions/clarifications of DOPT with respect to ACP/MACP Schemes without making any addition to it and without making any subtraction therefrom.

k) That the issue in hand having been attained the finality up to the Hon‟ble Supreme Court of India when it dismissed the SLP No. 15396/2015 of the respondent Department titled as UOI & Ors V/S Balakrishnan & Ors vide its order dated 31.08.2015, the respondent department should not rake up the said issue again and again.

l) That the impugned order dated 14.03.2017 has been causing a grave prejudice and miscarriage of justice aparty from financial loss to the applicants.

m) That the applicants crave the indulgence of this tribunal to raise additional grounds at the time of hearing of the original application.

n) That the applicant has got no other alternative, efficacious remedy except to approach this Tribunal."

8. At this stage, it will not be out of place to mention here that all the applicants in other connected OAs have also challenged the validity of the same impugned order, on the identical grounds.

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9. Levelling a variety of allegations, and narrating the sequence of events, in detail, in all, the applicants have claimed that they were rightly granted the benefits of 3rd financial upgradation under the MACP Scheme, but the same was abruptly withdrawn, without issuing any SCN, providing an opportunity of hearing, or without assigning any cogent reasons, by the Competent authority. On the strength of the aforesaid grounds, the applicants seek to quash the impugned orders, in the manner indicated herein above.

10. On the contrary, the respondents have refuted the claim of the applicants, and filed the reply, wherein it was pleaded that the Superintendent in the grade pay of Rs.4800/- get NFG in GP of Rs.5400 in PB-2 after 4 years of regular service. After promotion to the grade of Assistant Commissioner they are placed in GP of Rs.5400 in PB-3. It was averred that such Superintendents are claiming MACP benefit, after ignoring NFG granted to them, i.e. they are basically claiming financial upgradation under MACP in the promotional hierarchy which is contrary to the MACP Scheme.

11. According to the respondents, that the DOP&T, vide their clarification dated 26.07.2010 had clarified that the benefit of non - functional upgradation granted to the Superintendents (Group-B Officers) on completion of 4 years of service would be treated/viewed as upgradation in terms of para 8.1 of the Annexure to OM dated 19.05.2009 and the same would be offset against one financial upgradation under MACP Scheme. It was alleged that the Board in consultation with DOP&T issued a circular dated 20.05.2011 (Annexure A-4) in this regard. However, it was admitted that in pursuance of judgment of the Hon‟ble High Court of Madras in the case of Shri R. Chandrasekaran (supra), such

-9- O.A. No. 060/00335/2017 & connected matters applicants were held entitled to the grant of 3rd MACP, in the grade pay of Rs.6600/-, w.e.f. 04.06.2014, on completion of 30 years of service, under MACP Scheme, vide letter dated 06.05.2015. But subsequently, the DOP&T re-examined the issue and clarified that the grant of non-functional grade pay of Rs.5400/- in PB-2 to the Superintendents needs to be counted as one financial upgradation for the purpose of MACP Scheme.

12. Instead of reproducing the entire contents of written statement, and in order to avoid the possibility of repetition of facts, suffice it to say, that while virtually acknowledging the factual matrix, and reiterating the validity of the impugned orders, the respondents have stoutly denied all other allegations & grounds, and prayed for dismissal of all the OAs .

13. Controverting the pleadings of the written statement filed by the respondents and reiterating the grounds contained in the OA, the applicants has filed the replications in some cases, and prayed for the acceptance of the O.A. That is how we are seized of the matter.

14. Having heard learned counsel for the parties, having gone through the record with their valuable help, and after considering the entire matter, we are of the firm view that the instant O.As. deserve to be partly accepted, in the manner and for the reasons mentioned herein below.

15. What cannot possibly be disputed here is that initially the benefit of 3rd financial upgradation under MACP Scheme was granted to the applicants, in pursuance of letter dated 26.05.2015 (Annexure A-9). It is not a matter of dispute that the Hon‟ble Madras High Court in the case of Shri R. Chandrasekaran (supra) held that similarly situated persons are entitled to the benefit of 3 rd financial upgradation under MACP Scheme. In pursuance thereof, the DOP&T issued instructions dated 06.05.2015 (Annexure R-5),

-10- O.A. No. 060/00335/2017 & connected matters for grant of 3rd financial upgradation, to such employees under MACP Scheme.

16. Be that as it may, the fact remains is that the applicants were getting the benefit of 3rd financial upgradaiton, under the MACP Scheme, but strangely enough, it was abruptly withdrawn without issuing any SCN or providing any opportunity of hearing to them or assigning any cogent reasons, and ordered consequential recovery in this regard, in the garb of impugned order dated 14.03.2017 (Annexure A-1colly). In this manner, the respondents have no legal authority suddenly to reduce the pay/pension of the applicants, by withdrawing 3rd financial upgradation, without passing any legal/reasoned order.

17. Moreover, it is now well settled principle of law that such pay and pension cannot be reduced at the back after retirement of an employee, if he is not at fault. In the present matter, it is not the case of the respondents that the applicants mis-represented the facts or played any kind of mischief to get the relevant benefit. The applicants cannot be blamed in any manner, in this regard. This matter is no more res integra and now is well settled.

18. An identical question came to be decided by Hon‟ble Apex Court in the case of Bhagwan Shukla Vs. U.O.I. and Others AIR 1994 SC 480, wherein it was ruled that in case any employee is reduced without following the due procedure of law in lower scale, then he has obviously been visited with the civil consequences. There has, thus, been a flagrant violation of the principles of natural justice and he was made to suffer huge financial loss, without being heard. Fair play in action warrants that no such order, which has the effect of employee suffering civil

-11- O.A. No. 060/00335/2017 & connected matters consequences, should be passed without putting the concerned employee to notice and giving him a hearing in the matter.

19. Sequelly, the Hon'ble Apex Court in the case titled Indu Bhushan Dwivedi Versus State of Jharkhand and another, (2010) 11 SCC, 278, has ruled as under:-

"One of the basis canons of justice is that no one can be condemned unheard and no order prejudicially affecting any person can be passed by a public authority without affording him reasonable opportunity to defend himself or represent his cause. As a general rule, an authority entrusted with the task of deciding lis between parties or empowered to make an order which prejudicially affects rights of any individual or visits him with civil consequences is duty-bound to act in consonance with basis rules of natural justice including the one that material sought to be used against person concerned must be disclosed to him and he should be given an opportunity to explain his position. This unwritten right of hearing is fundamental to a just decision, which forms an integral part of concept of rule of law. This right has its roots in notion of fair procedure. It draws attention of authority concerned to imperative necessity of not overlooking cause which may be shown by the other side before coming to its decision.

The employer is not only required to make the employees aware of specific imputations of misconduct but also to disclose material sought to be used against him and give him a reasonable opportunity of explaining his position or defending himself. If the employer uses some material adverse to the employee about which the latter is not given notice, final decision gets vitiated on the ground of violation of rule of audi alteram partem. Even if there are no statutory rules which regulate holding of disciplinary enquiry against a delinquent employee, employer is duty-bound to act in consonance with rules of natural justice."

20. Not only that, the Competent was required to consider the entire matter in the right perspective to decide the real controversy and pass a legal speaking order. The passing of speaking order by the competent authority is the basic legal requirement which is totally lacking in the present case, in view of instructions issued by the Central Vigilance Commission vide Office Order No. 51/09/03 dated 15.09.2003.

21. Exhibiting the necessity of passing of speaking orders, the Hon‟ble Apex Court in the case of Chairman, Disciplinary Authority, Rani Lakshmi Bai Kshetriya Gramin Bank Vs.

-12- O.A. No. 060/00335/2017 & connected matters Jagdish Sharan Varshney and Others (2009) 4 SCC 240 has in para 8 held as under:-

"8. The purpose of disclosure of reasons, as held by a Constitution Bench of this Court in the case of S.N.Mukherjee vs. Union of India reported in (1990) 4 SCC 594, is that people must have confidence in the judicial or quasi-judicial authorities. Unless reasons are disclosed, how can a person know whether the authority has applied its mind or not? Also, giving of reasons minimizes chances of arbitrariness. Hence, it is an essential requirement of the rule of law that some reasons, at least in brief, must be disclosed in a judicial or quasi-judicial order, even if it is an order of affirmation".

22. An identical question came to be decided by the Hon‟ble Apex Court in a celebrated judgment in the case of M/s Mahavir Prasad Santosh Kumar Vs. State of U.P. & Others 1970 SCC (1) 764 which was subsequently followed in a line of judgments. Having considered the legal requirement of passing speaking order by the authority, it was ruled that "recording of reasons in support of a decision on a disputed claim by a quasi-judicial authority ensures that the decision is reached according to law and is not the result of caprice, whim or fancy or reached on grounds of policy or expediency. A party to the dispute is ordinarily entitled to know the grounds on which the authority has rejected his claim. It was also held that "while it must appear that the authority entrusted with the quasi-judicial authority has reached a conclusion of the problem before him: it must appear that he has reached a conclusion which is according to law and just, and for ensuring that he must record the ultimate mental process leading from the dispute to its solution". Such authorities are required to pass reasoned and speaking order. The same view was again reiterated by Hon‟ble Apex Court in the case of Divisional Forest Officer Vs. Madhuusudan Rao JT 2008 (2) SC

253.

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23. As is apparent, that no reason, much less cogent, has been given except clarification of DOP&T, in the impugned order. No other reason, whatsoever, has been recorded. It was for the Competent Authority to apply its independent mind as to whether the applicants were entitled to 3rd financial upgradation or not, and then to decide the matter, after issuing SCN or providing an opportunity of hearing, and pass a reasoned and speaking order, which is totally lacking in the present case.

24. Therefore, in case the Competent Authority, intended to withdraw the benefit of 3rd financial upgradation, and reduce the pay/pensionary benefits of the applicants, then it was its mandatory duty, to issue SCN and provide an adequate opportunity of hearing to them, before passing any adverse order at their back. Indeed this is clear violation of principle of natural justice and Doctrine that a person cannot be condemned unheard at his back. Moreover, the administrative actions of the Competent Authority should be just on the test of fair play and reasonableness, which is totally lacking in the present case.

25. No other point worth consideration has either been urged or pressed by the learned counsel for the parties.

26. In the light of the aforesaid prismatic reasons, and without commenting further anything on merit, lest it may prejudice the case of either side, during fresh consideration of the matter, the instant OAs are hereby accepted. As such the impugned orders dated 14.03.2017, in all the indicated OAs, are set aside. As a consequence thereof, the cases are remitted back to the Competent Authority to decide the matter for grant of 3rd financial upgradation afresh, after providing adequate opportunity of hearing to the

-14- O.A. No. 060/00335/2017 & connected matters applicants, by passing a speaking/reasoned order, and in accordance with law, before effecting any recovery of impugned amount from them, preferably within a period of three months from the date of receipt of a certified copy of this order. However, the parties are left to bear their own costs.

(P. GOPINATH)                         (JUSTICE M.S. SULLAR)
 MEMBER (A)                               MEMBER (J)
                                         Dated: 08.05.2018
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Central Administrative Tribunal - Chandigarh