Telangana High Court
T.Narasimha Das vs The Ap. Dairy Development Cooperative ... on 6 April, 2022
Author: P. Madhavi Devi
Bench: P. Madhavi Devi
THE HONOURABLE SMT. JUSTICE P. MADHAVI DEVI
WRIT PETITION NO.18884 OF 2004
ORDER
This Writ Petition is filed seeking a Writ of Mandamus declaring the impugned Rule 26(1)(b)(1) of the Conduct, Discipline and Appeal Rules of the A.P.Dairy Development Cooperative Federation Limited as violative of the fundamental rights guaranteed under the Constitution of India and the orders passed by the 1st respondent in Proceedings No.2770/Admn.IV/DC-4/96 dt.28.01.1999 in so far as it directs recovery of subsistence allowance from leave salary, as illegal and arbitrary.
2. Brief facts leading to the filing of this Writ Petition are that the petitioner has joined the A.P. Government as Veterinary Assistant Surgeon in the year 1974 and thereafter after being selected as Manager, Grade II by the 1st respondent Federation, he joined the respondent Federation in the year 1979 and he is working as such even as on the date of filing of this Writ Petition. While the petitioner was working as Manager of Warangal Dairy, he was placed under suspension by the 1st W.P.No.18884 of 2004 2 respondent vide proceedings No.2770/Admn.IV/DC-4/96-1 dt.20.05.1996 on some allegations. Thereafter, after enquiry and after considering the explanation of the petitioner, vide proceedings No.2770/Admn.IV/DC.4/96, dt.28.01.1999, punishment of stoppage of one annual increment with cumulative effect was awarded. In the said order, it was also stated that the period of suspension shall be treated as leave to which the individual is entitled and subsistence allowance shall be recoverable from leave salary as per Rule 26(1)(b)(1) of the Conduct, Discipline and Appeal Rules (for short, 'the Rules').
3. Aggrieved by the said order, the petitioner filed an Appeal before the 2nd respondent Board, but the same was rejected vide proceedings No.2770/Admn.IV/ DC-4/96 dt.15.06.1999. Meanwhile, the petitioner had requested the respondents not to effect recovery of subsistence allowance already paid to him since he was kept under suspension for more than two years and eight months, that too after the receipt of the enquiry report, his explanation and imposing the punishment of stoppage of one annual increment with cumulative effect. Taking the petitioner's representation into consideration, the respondents did not effect any recovery from the salary immediately. However, subsequently consequent to the impugned order dt.28.01.1999, the General Manager W.P.No.18884 of 2004 3 of the 1st respondent Federation issued proceedings No.PER-
1/B3/858/2003 dt.04.02.2004, whereunder the suspension period of the petitioner was regularised as EL for 132 days, HPL for 40 days and EOL without pay and allowances for 813 days. By the said proceedings, the 3rd respondent was directed to effect recovery of the subsistence allowance paid during the suspension period. Accordingly, the 3rd respondent vide orders dt.21.08.2004 directed that the subsistence allowance amounting to a sum of Rs.2,44,603/- should be recovered from the petitioner's salary.
4. Aggrieved, the petitioner has filed this Writ Petition challenging the Rule 26(1)(b)(1) of the Conduct, Discipline and Appeal Rules of the 1st respondent Federation, as violative of the fundamental rights guaranteed under Article 21 of the Constitution of India. According to the petitioner, subsistence allowance is not paid as emolument or remuneration, but it is only an allowance being paid for continuing the relation between employer and employee only to enable the suspended employee to sustain himself and his family during the period of suspension. The petitioner submits that if the subsistence allowance is recovered from the salary due to him, particularly in view of the sanction of extraordinary leave without pay and allowances and no W.P.No.18884 of 2004 4 increments being given, it will result in further loss of more than Rs.60,000/- to the petitioner. He therefore seeks setting aside of the said Rule as arbitrary and illegal.
5. Learned counsel for the petitioner, Sri S. Satyam Reddy, reiterated the submissions made in the writ affidavit and also placed reliance upon a decision of the Hon'ble High Court of Rajasthan in the case of Shyam Sunder Mal Vs. Rajasthan High Court1.
6. Learned counsel for the respondents, Sri Palle Sriharinath, placed reliance upon the contentions raised in the counter affidavit and submitted that as per Rule 26(1)(b)(i) of the Conduct, Discipline and Appeal Rules, 1983 of the 1st respondent Federation only, directions for recovery were given by the respondent authorities and therefore, there was no illegality in the impugned order.
7. Having regard to the rival contentions and the material on record, it is seen that Rule 26(1)(b) Note (i) of the Andhra Pradesh Dairy Development Cooperative Federation Limited Conduct, Disciplinary and Appeal Rules, 1983 provides as under:
"Rule 26: Treatment of the period of suspension:1
2000 LawSuit(Raj) 593 W.P.No.18884 of 2004 5 (1) Para-4: .... .... .... .... ....
Provided also that where an order imposing fine or stoppage of annual increment or reduction in rank is passed under this clause, the employee shall be deemed to be on duty during the period of suspension and shall be entitled to the same wages as he would have received if he had not been placed under suspension, after deducting the subsistence allowance paid to him for such period.
Provided also that:
(a) Where an order imposing warning, censure, suspension, fine or stoppage of annual grade increment(s) without cumulative effect is passed under this clause, the employee shall be deemed to be on duty during the period of suspension and shall be entitled to the same wages as he would have received, if he had not been under suspension after deducting the subsistence allowance paid to him for such period.
(b) Where an order of imposing stoppage of annual grade increments(s) with cumulative effect (or) reversion to a lower stage in a time scale the employee shall be deemed to be not on duty during the period of suspension and the suspension period will be treated as leave for which the suspended employee is eligible.
NOTE: (i) In case suspension period is treated as leave, subsistence allowance paid during the period of suspension will be recovered in lump sum (or) in instalments depending upon the amount to be recovered.
(ii) In case suspension period is treated as EOL
subsistence allowance paid during the
W.P.No.18884 of 2004
6
suspension period will be recovered from the
subsequent salaries drawn."
Thus, it can be seen from the said provision that the petitioner is supposed to be granted leave which is due to him and paid salary accordingly and thereafter from the said salary, the subsistence allowance which is already paid for the very said period, has to be recovered from the subsequent salaries drawn.
8. The Hon'ble Rajasthan High Court was seized of the similar issue in the case of Shyam Sunder Mal Vs. Rajasthan High Court (1 supra) and the Hon'ble High Court has held that the subsistence allowance during the suspension is not only a mere question of term of a contract of employment, but forms part of the constitutional theme of procedural reasonableness and rule against arbitrariness and therefore denying the full pay and dearness allowance for the period of suspension by adjusting the period of suspension against leave without pay is not sustainable. For the sake of clarity and ready reference, the relevant paragraphs are reproduced as under:
"[6] The State of Haryana contended that this was a case equivalent to a case in which an accused is not honourably acquitted, relying on an unreported decision of Supreme Court in State of Assam vs. Raghava Rajgopalachari (CA Nos. 1551 and 1532/1966) decided on W.P.No.18884 of 2004 7 6.10.1967. The Court repelled the contention and held the employee entitled to full remuneration for the period by holding as under: "this decision cannot apply to the instant case for the simple reason that Government, by withdrawing the proceedings initiated against the appellant in respect of Charge 1 (b), made it impossible for the appellant to get himself fully exonerated. Since the appellant had been exonerated of Charge 1(a) and since Charge 1(b) was withdrawn, it is impossible for Government to proceed on the basis as if the appellant has not been fully exonerated or to assume that the order of suspension was one which was not wholly unjustified."
Even assuming, that the petitioner is not entitled as a matter of course for full remuneration in such circumstances, and Rule 54 operates, even so the order made under Rule 54(3) is not sustainable for the aforesaid reason. At any rate, subsistence allowance paid during period of suspension is not liable to be recovered. Subsistence allowance is paid under Rule 53 of the RSR, which reads as under:- 53. Subsistence grant.- (1) A Government servant under suspension shall be entitled to the following payments, namely:- (a) subsistence allowance at an amount equal to the leave salary which the Government servant would have drawn if he had been on leave on half pay and in addition dearness allowance based on such leave salary; Provided that where the period of suspension exceeds six months the authority which made or is deemed to have made the order of suspension shall be competent to vary the amount of subsistence allowance for any period subsequent to the period of the first six months as follows:- (i) the amount of subsistence allowance may be increased by a suitable amount, not exceeding to 50 percent of the subsistence allowance admissible during the period of first six months if, in the opinion of the said authority, the period of suspension has W.P.No.18884 of 2004 8 been prolonged for reasons to be recorded in writing not directly attributable to the Government servant; (ii) the amount of subsistence allowance may be reduced by a suitable amount, not exceeding 50 percent of the subsistence allowance admissible during the period of the first six months if, in the opinion of the said authority, the period of suspension has been prolonged due to reasons, to be recorded in writing, directly attributable to the Government servant; (iii) the rate of dearness allowance will be based on the increased or, as the case may be the decreased amount of subsistence allowance admissible under Sub-clauses (i) and (ii) above. (b) Any other compensatory allowance admissible from time to time on the basis of pay which the Government servant was in receipt on the date of suspension subject to the fulfilment of other conditions laid down for the drawal of such allowances. (2) No payment under Sub-Rule (1) shall be made unless the Government servant furnishes a certificate, that he is not engaged in any other employment, business, profession or vocation: Provided that in the case of a Government servant dismissed, removed or compulsorily retired from service, who is deemed to have been placed or to continue to be under suspension from the date of such dismissal or removal or compulsory retirement under Sub-Rule (3) or Sub-Rule (4) of Rule 13 of the Rajasthan Civil Services (Classification, Control and Appeal) Rules, 1958 and who fails to produce such a certificate for any period or periods during which he is deemed to be placed or to continue to be under suspension, he shall be entitled to the subsistence allowance and other allowances equal to the amount by which earnings during such period or periods as the case may be, fall short of the amount of subsistence allowance and other allowances that would W.P.No.18884 of 2004 9 otherwise be admissible to him; where the subsistence allowance and other allowances admissible to are equal to or less than the amount earned by him, nothing in this proviso shall apply to him.
This rule makes it imperative to pay subsistence allowance to an employee during the period of suspension at the aforesaid rates. This subsistence allowance is not paid provisionally. Rule 54 operates when a person is reinstated. Rule 54 is not an non-obstante Clause. It does not deal with the question of interfering with the subsistence allowance paid under Rule 53. Under Rule 53 if subsistence allowance is paid on the condition that while the master and employee relation is not terminated but is suspended temporarily during that period he does not work anywhere else. It is for providing livelihood to such an employee. Rule 54 does not envisage that any part of the subsistence allowance paid under Rule 53 is liable to be reduced or recovered in pursuance of any order made under Rule 54. Infact, it does not deal with the subject of subsistence allowance paid under Rule 53 at all. As will be seen presently, no salary accrues to the incumbent during the period of suspension and he is not entitled to any remuneration. Rule 54 requires two things to be determined whether the period during which the person remains out of employment on account of dismissal was not allowed to serve his duties can be considered as spent on duty when reinstated and whether on such reinstatement he is entitled to any remuneration paid alongwith such period of absence from duty. Obviously this is so because once person is reinstated, he also becomes entitled to remuneration for that period as per remuneration payable under the terms of employment and since he has not discharged his duties within that period, what remuneration is W.P.No.18884 of 2004 10 to be paid to him is only to be determined. Rules 53 and 54 do not simultaneously operate but operate on different fields. The only reasonable and harmonious construction that can be of Rule 54 is that on reinstatement of an employee while determining the question of treating the period spent during suspension, the question of accrual of remuneration and payable during that period is to be decided by the authority. When the question of actual payment of such remuneration for that period arises he may be entitled to only such remuneration to be paid to him which exceeds subsistence allowance already paid to him but no amount of subsistence allowance paid under Rule 53 is liable to be withdrawn or recovered.
The case before us squarely falls in the aforesaid ratio.
[7] There is yet another reason for us to hold that no recovery of subsistence allowance can be recovered otherwise. Subsistence allowance is not paid as emolument or remuneration. It is paid for continuing the link of employer-employee during the suspension period to meet the employee's minimal needs of sustenance. That is essential to sustain his right to life. That subsistence allowance is paid and payable irrespective of result of enquiry. Even in case, the employees is punished suspension is not revoked, it does not entitle the employer to recover any part of subsistence allowance from him by treating the period of suspension as period not spent not on duty for which no remuneration may accrue on the premise of continuity of service on reinstatement. Recovery of subsistence allowance in any circumstance would result in forfeiting his right to receive subsistence allowance in case he is exonerated, though not fully or his suspension was held to be not wholly unjustified. The subsistence allowance is payable under different set of rules, because of a particular situation W.P.No.18884 of 2004 11 arising from actions of the employer, to guarantee minimum living wage during suspension are not to be withdrawn. Neither Rule 53 provides payment of subsistence allowance subject to orders made under Rule 54, nor do the Rule 54 envisage that by making order for treating the period of suspension as not spent on duty or being adjusted against admissible leave, the subsistence allowance otherwise payable under Rule 53 during the period the employee is not required to discharge his duty, under the direction of the employer and not on his volition, shall result in recovery of subsistence allowance. Forfeiting the subsistence allowance in any circumstances would not only give rise to an anomalous situation that man punished will retain the subsistence allowance, but a person who is reinstated though found guilty of lesser charge and lesser punishment then termination of services is imposed or is not found guilty at all, shall forfeit his subsistence allowance wholly or partly by effecting recovery thereof.
Subsistence allowance is not payable to an employee under suspension as continued remuneration. In the absence of Rules, if suspension is not authorised by rules, then it merely amounts employer's direction to the employee not to work. There is no implied term of contract that an employer can suspend an employee without pay. In such circumstances, though in compliance of employers an employee may not discharge his duties, but he is entitled to full remuneration for the period of suspension. That was the principle laid in Management of Imperial Hotel New Delhi Vs. Hotel Workers Union (8), and in R.P. Kapur Vs. Union of India & Anr. (9). Under this situation, the question of less or no payment to an employee simply does not arise and question of recovery will also not arise on revocation of suspension.
W.P.No.18884 of 2004 12Position of law where suspension is authorised under terms of service may be stated thus. Where there is power conferred on the employer to suspend an employee, whether under express form in the contract or under the rules governing the terms and conditions of service, the order of suspension has the effect of temporarily suspending the relation of master and servant, without terminating it, with the consequence that employee is not bound to render the service and the employer is not bound to pay. In such a case employee is not entitled to receive any payment at all from the employer, unless terms of condition envisages some payment as subsistence allowance. This principle was enunciated in Management of Imperial Hotel, New Delhi Vs. Hotel Workers Union, and in R.P. Kapur Vs. U.O.I. & Anr., and V.P. Gindroniya Vs. State of M.P. (10). The same principle was applied in Vice Chancellor, Jammu University vs. Dushiant Kumar Rampal. That is to say subsistence allowance is not the remuneration of employment, but an amount payable to an employee to make the conditions of service more humane and reasonable in the sense that it will fulfil the requirement of natural justice as a part of a fair and just enquiry before he is indicted for any misconduct.
[8] In State of M.P. vs. State of Maharashtra (12), it was laid down that suspension merely suspends employee's claim to salary. During suspension there is suspension allowance. Real effect of order of suspension is that though he continues to be in service, he is not permitted to work and is paid only subsistence allowance which is less than his salary.
The necessity and compulsion to pay subsistence allowance during the suspension pending enquiry can be said to be a part of essentials of fair and just procedure to conduct an enquiry which W.P.No.18884 of 2004 13 can be attributed to rule against unreasonableness and arbitrariness under Article 14 of the Constitution and right to life, which includes livelihood, under Article 21 of the Constitution. This can be seen from the fact that where subsistence allowance has not been paid to an employee under suspension during enquiry disabling him from participating in the enquiry has been held to result in violation of natural justice vitiating the enquiry itself. Reference in this connection may be made to Inderjit C. Parkeh & Ors. Vs. H. K. Bhatt and another (13), and Ghanshamdas vs. State of M.P. Reference in this connection may also be made to State of Maharashtra vs. Chandrabhen Tale. It was a case where a nominal subsistence allowance of Re. 1/- was paid to the employee under suspension during pendency of his appeal against an order of conviction because he was on bail, under proviso to Rule 151 and was not paid his normal subsistence allowance. The Court upheld the contention raised with reference to Arts. 14, 16, 21 & 311(2) of the Constitution challenging the validity of such provisions providing reduced subsistence allowance which is Illusory and meaningless on the ground that reduction in normal subsistence allowance to an employee who is prohibited from engaging himself in any other vocation during the period of suspension contravenes Art.12 and also Art. 14 & 16 being unreasonable and directed that normal subsistence allowance must be paid irrespective of whether he is undergoing imprisonment or on bail, and said proviso to Rule 151 envisaging paying a nominal subsistence allowance of Re. 1/- was held to be unreasonable, unconstitutional and void.
Thus requirement of minimal reasonable payment as subsistence allowance during suspension is not only a mere question of term W.P.No.18884 of 2004 14 of a contract of employment, but forms part of the constitutional theme of procedural reasonableness and rule against arbitrariness. What is reasonable sum as subsistence allowance in measured in terms of normal subsistence allowance under the Rules presumably for such payment, if any. It is not paid as a part of remuneration as such but flows from a different obligation. In these circumstances, on reinstatement whether such allowance can be withdrawn or adjusted in such a manner so as to result in affecting any recovery from such allowance? Rule does not provide expressly for any such recovery to be made from subsistence allowance already paid. The contention is that since u/r. 54(3) an order has to be made for treating the period under suspension for treating it to be on duty or otherwise and consequence on the entitlement to remuneration for such period on that basis impliedly authorises recovery of subsistence allowance, where full remuneration does not become payable to the employee reinstated.
We are unable to read any such implied authority to reduce or annihilate the amount of subsistence allowance, and recover the same by adjustment against remuneration that becomes payable to the employee on reinstatement or in any other manner. Rule 54 merely provides for determining the question how the period under suspension is to be treated on reinstatement and remuneration becomes payable in accordance with such order. It can only mean that where no remuneration become payable as per the order made under Rule 54, the employee shall not be paid anything more than subsistence allowance. If any remuneration becomes payable to such reinstated employee, the employee is only entitled to additional payment of such remunerations to the extent it exceeds subsistence allowance already paid. But in no circumstances subsistence allowance payable as such under Rule W.P.No.18884 of 2004 15 54 of RSR can be reduced so as to effect recovery of any part of subsistence allowance. Therefore, the amount of subsistence allowance ordered to be adjusted because period of suspension has been ordered to be adjusted against leave without pay, meaning thereby no remuneration is payable for that period, makes the impugned order as an order of effecting recovery of subsistence allowance, not against any additional sum payable by way of remuneration for that period, but by way of denying the subsistence allowance in lien of reinstatement. That in our opinion will be an order punitive in nature and not authorised by law and against the constitutional mandate.
[9] Therefore, the recovery of suspension allowance paid to the appellant petitioner for the period of suspension by adjusting the same against remuneration that became payable to the appellant because of the direction contained in order setting aside the order of compulsory retirement must be held to be void.
[10] As discussed above, we are unable to sustain the contention raised by respondents for denying the full pay and dearness allowance for the period of suspension by adjusting the period of suspension against leave without pay under Rule 54(5). In the facts and circumstances of the case petitioner's case is governed by Rule 54(2) of the Rules."
9. Following the above judgment, in the case before this Court also, it is held that Rule 26(1)(b)(i) of the Conduct, Discipline and Appeal Rules of the 1st respondent Federation is unsustainable where the subsistence allowance paid to the petitioner is more than the salary W.P.No.18884 of 2004 16 payable to the petitioner if suspension period is treated as leave due to the petitioner.
10. The Writ Petition is accordingly allowed. No order as to costs.
11. Pending miscellaneous petitions, if any, in this Writ Petition shall stand closed.
___________________________ JUSTICE P. MADHAVI DEVI Date: 06.04.2022 Svv