Madras High Court
M.K.Dange vs Chairman-Cum-Managing on 14 March, 2006
Author: N.Paul Vasanthakumar
Bench: N.Paul Vasanthakumar
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated: 14/03/2006
Coram
The Hon'ble Mr.Justice N.PAUL VASANTHAKUMAR
Writ Petition No.21812 of 2005
W.P.M.P.No.23765 of 2005
M.K.Dange ... Petitioner
-Vs-
1. Chairman-cum-Managing
Director,
Oil and Natural Gas Corporation,
Jeevan Bharati Building,
124, Connaught Circus,
New Delhi 110 001.
2. The Director (Finance),
Oil and Natural Gas Corporation,
Jeevan Bharati Building,
124, Connaught Circus,
New Delhi 110 001.
3. The General Manager (F&A),
Oil and Natural Gas Corporation,
CMDA Building,
Egmore,
Chennai 600 008. ... Respondents
This writ petition has been filed under Article 226 of Constitution of
India, praying this Court to issue a writ of certiorarified mandamus, calling
for the records relating to Order No.ONG/SR/CO/DISCP/93 dated 7.12.1993 passed
by the Third respondent as extended by order No.17721(06)/SCRO/E.II/2003 dated
6.6.2005 passed by the third respondent, quash the same and direct the
respondents to reinstate the petitioner in service with all consequential
benefits, including payment of arrears of pay and allowances from the date of
his suspension till the date of his reinstatement together with interest at
12% per annum and consider him for promotion to the next higher posts on par
with his immediate juniors.
!For Petitioner : Mr.P.V.S.Giridhar
for M/s.PVS Giridhar Associates
^For Respondents : Mr.G.Masilamani, Sr.Counsel
for M/s.King & Partridge
:O R D E R
Prayer in the writ petition is to quash the order of suspension dated 7.12.1993 as extended by order dated 6.6.2005, passed by the third respondent and direct the respondents to reinstate the petitioner in service with all consequential benefits including payment of arrears of pay and allowances from the date of his suspension till the date of reinstatement together with interest at 12% per annum and consider the petitioner for promotion to the next post on par with his immediate juniors.
2. When the miscellaneous petition was taken up for hearing, the learned counsel appearing for the petitioner as well as the learned Senior Counsel appearing for the respondents submitted that the arguments in both the miscellaneous petition as well as the main writ petition will be the same. Hence with the consent of both sides, the main writ petition itself was taken up for final disposal.
3. The original order of suspension dated 7.12.1993, which is also impugned in this writ petition reads as follows, "It has been decided by the Competent Authority to conduct preliminary enquiry into the matter relating to the passing of payment of Rs.3 0,84,124/- in favour of M/s.Western Services International against the instructions of ONGC without proper verifications. The continuance of Shri M.K.Dange, Dy.Director (F&A) on duty is likely to prejudice investigation, enquiry or trials.
2. Now, therefore, the undersigned in exercise of the powers conferred under sub-Regulation (1) of Regulation 33 of ONGC CDA Regulations 1976 as amended from time to time read with powers conferred on my office vide Item No.C2.2 of BDP 1993 of ONGC, hereby place Shri M.K. Dange, Dy.Director (F&A) under suspension with immediate effect."
4. The Charges framed against the petitioner for initiating the disciplinary proceeding are as follows, "a) Indulged in false fabrication of letter heads and letters in the name of Western Services International, a Foreign Company of USA origin which had certain contractual relations with the ONGC in the past with the intention to make fraudulent claims of income-tax refund amount held in the name of the said Western Services International.
b) Falsely introduced one Shri I.Rathnakar of Hyderabad as the Proprietor of the said Western Services International to the Andhra Bank, Chetpet Branch with a view to facilitate the said Shri I.Rathnakar opening an account in the name of the said Western Services International for the purpose of fraudulently encashing the cheque to be issued in the name of Western Services International purporting to be the refund amount.
c) Falsely fabricated a letter purportedly 20.10.93 as if issued from the Income-tax Wing at Dehradun to Shri D.P.Mukherjee, Additional Director, Finance and Accounts, ONGC, Madras, authorising to refund of income-tax held in the name of Western Services International.
d) Knowing fully well the fraudulent nature of the transactions, prepared and signed a bank payment voucher dt.2.12.93 for Rs.30,84,124/- in the name of the said Company to the tune of the said amount with an intention to fraudulently encash the same and obtain the proceeds.
e) Negligently deducted an amount of Rs.33,10,819/- from the refund amount held in the name of Western Services International and authorised the remittance of the same to the Income-tax department towards the Personnel Tax liability of Western Services International though the amount actually belonged to ONGC.
Thus, Shri M.K.Dange, Sr.F&AO failed to maintain absolute integrity and devotion to duty. He has committed fraud and dishonesty in connection with the business or property of the Company. He has shown dereliction of duty with ulterior motive and thereby he has committed gross misconduct and contravened the provisions of Rule 4(1), a, b, c read with Sl.Nos.(3), (5) & 30 of Schedule II to Rule 3(J) of ONGC, CDA Rules, 1994."
5. The petitioner herein, earlier challenged the original order of suspension dated 7.12.1993 passed by the third respondent as confirmed by order dated 30.5.2001 of the Chief Manager, ONGC, in W.P.No.15495 of 2002. The said writ petition was dismissed by this Court on 22.8.2003. The operative portion of the order dated 22.8.2003 reads as follows, "For all the above reasons, I find no merit in the writ petition and the same is liable to be dismissed. However, this Court has to take into consideration of the fact that though on the given facts and circumstances upheld the order of prolonged suspension, nevertheless, the trial cannot be prolonged for no reasons as after the charges were framed and most of the witnesses had been examined, it would be in the interest of the petitioner to complete the trial as expeditiously as possible. However, in the absence of any details as to the witnesses to be examined on behalf of the prosecution as well as on behalf of the petitioner and the time to be consumed for the same, I do not propose to fix any time limit for the criminal Court to complete the trial. However, both the petitioner and the respondents are given liberty to approach the 8th Additional (CBI) Court, Chennai for expeditious disposal of the case. In the event of such applications being filed, the same shall be duly considered by the learned Judge who shall expedite the trial and complete the same as expeditiously as possible."
The learned Judge thus upheld the order of suspension dated 7.12.1993 .
6. The learned counsel appearing for the petitioner contended that after disposal of the above writ petition, the Principal Special Judge for CBI cases tried the criminal case filed against the petitioner in C.C.No.176 of 1997 and acquitted the petitioner from the charges. Based on the acquittal, petitioner made a representation on 22.3.2005 to the second respondent seeking revocation of suspension. Since there was no response, a reminder was sent by the petitioner on 8.5.200 5 and thereafter the third respondent by order dated 6.6.2005 extended the suspension until further orders.
7. The thrust of the arguments made by the learned counsel for the petitioner is that after the petitioner having been acquitted by the criminal Court, there is no justification to keep the petitioner under suspension and the prolonged suspension of the petitioner for 12 years is not legally sustainable. The second contention urged by the learned counsel for the petitioner is that the extension of suspension order is issued by the third respondent in a mechanical manner without any application of mind and no reason for such extension is stated. The third contention is that no ground exists for continuing the order of suspension after the acquittal of petitioner from the criminal case and due to the extension of suspension, the petitioner is not only denied his salary and other benefits, but also his promotional chances are being affected and several of his juniors are promoted as Deputy Managers and Managers ahead of the petitioner. The learned counsel cited the following judgments in support of his contentions,
a) AIR 1984 SC 626 (Corporation of Nagpur v. Ramchandra G.Modak)
b) 2002 WLR 546 (A.Boopalan v. The Assistant Director, Khadi and Village Industries and another)
c) 2003 WLR 644 (C.Baskaran v. The Managing Director, Tamil Nadu State Transport Corporation, Dindigul & Others)
d) 1996 WLR 332 (K.Thangaraj v. The Managing Director, Dheeran Chinnamalai Transport Corporation Limited, Tiruchirapalli)
e) (1994) 28 Administrative Tribunals Cases 711 ( Sulekh Chand v.
Commissioner of Police) (SC).
8. The learned Senior Counsel appearing for the respondents submitted that the petitioner was not honourably acquitted in the criminal case as claimed by the petitioner, but his acquittal was solely on the basis of benefit of doubt. The learned counsel also pointed out that the alleged discriminatory treatment given to the petitioner has no substance since the co-delinquent viz., Harid was dismissed from the service and the present impugned order is only extension of the suspension order already issued and the same should be read along with the original order of suspension dated 7.12.1993 and therefore no further reason need be given for extension of the suspension. The learned Senior Counsel further submitted that even if the delinquent is acquitted in the criminal case, it is the prerogative of the department to conduct departmental enquiry. In support of the said proposition the learned Senior Counsel cited the following decisions,
i) (2003) 9 SCC 164 (Principal, J.D.Patil Sangludkar and another v. Ganesh)
ii) (2005) 7 SCC 764 (Ajit Kumar Nag v. General Manager (PJ), Indian Oil Corpn. Ltd., Haldia and others), and
iii) (2006) 1 MLJ 511 (Indian Overseas Bank v. P.Ganesan).
9. In the light of the above submissions and contentions, the following issues arise for determination in this writ petition,
1) Whether the management is justified in extending the order of suspension even after the acquittal of the petitioner in the criminal case ?
2) Whether for extending the order of suspension, fresh reasons should be recorded in the order of suspension ?
10. Issue No.1: It is not in dispute that even after the acquittal by the Criminal Court, the department has the right to continue with the disciplinary proceedings as held by the Honourable Supreme Court in the decision reported in AIR 2003 SC .M.D., United Commercial bank, v. P.C.Kakkar), wherein in paragraph 15 it is held as follows, "... Acquittal in the criminal case is not determinative of the commission of misconduct or otherwise, and it is open to the authorities to proceed with the disciplinary proceedings, notwithstanding acquittal in criminal case. It per se would not entitle the employee to claim immunity from the proceedings. At the most the factum of acquittal may be a circumstance to be considered while awarding punishment. It would depend upon facts of each case and even that cannot have universal application."
11. The Honourable Supreme Court in a very recent decision reported in JT 2006 (1) SC 444 = (2006) 1 M.L.J. 166 (S.C.) (Chairman-cum-M.D., T.N.C.S.Corpn. Ltd. & Ors. v. K.Meerabai) considered a similar issue as to whether departmental proceeding can be initiated or continued after the acquittal in the criminal case for the criminal charges. In paragraph 25, the Honourable Supreme Court held thus, "The scope of disciplinary proceedings and the scope of criminal proceedings in a court of criminal law are quite distinct, exclusive and independent of each other. The prosecution proceedings launched against the respondent herein were in respect of offences punishable under Sections 409 and 477A IPC, whereas the departmental proceedings as initiated against her were in respect of the charges of misappropriation and other fraudulent practices such as deliberate omission to bring into accounts the stock received showing bogus issues in the records, falsification of accounts, submission of defective accounts, tampering of records, manipulation of accounts and records etc. Thus, the respondent herein was proceeded against for quite different charges and on different sets of facts before the court of Chief Judicial Magistrate, on the one hand, and before the departmental enquiry on the other."
In the said judgment it is further held that the High Court was wrong in setting aside the order of dismissal on the ground that the criminal Court acquitted the delinquent and in paragraph 24 held thus, "The order of dismissal passed by the disciplinary authority was based on dispassionate and independent examination and appreciation of the entirety of facts and evidence on record relating to the malpractices and mis-appropriation indulged in by the respondent in collusion with the other members of the staff causing thereby huge loss to the Corporation." In view of the above said decisions, it cannot be disputed that the respondents/Management are entitled to proceed with the departmental proceeding, in spite of the acquittal in the criminal case, more particularly, when the criminal Court acquitted the petitioner by giving benefit of doubt. At this juncture I feel it relevant to extract the findings of the criminal Court in paragraph 58 of its judgment, which reads as follows, "... as rightly contended by the accused, the benefit of doubt emanating from the same should be extended in favour of the accused and accordingly the benefit of doubt emerging from the case is extended in favour of the accused. I hold therefore, that the prosecution has failed to establish the case against the accused beyond reasonable doubt and accordingly acquit the accused."
A reading of the above judgment makes it clear that the petitioner was not acquitted on merits and only on the basis of giving benefit of doubt.
12. The learned counsel appearing for the petitioner submitted that even though the charges were framed in the year 1997, no earnest step was taken to conduct the enquiry and complete the disciplinary proceeding.
13. In reply to the above submission, the leaned Senior Counsel appearing for the respondents submitted that by the letter dated 27.3.199 7, the petitioner requested for postponement of the enquiry due to the pendency of investigation and filing of charge sheet by CBI in the 6th Additional City Civil Court, Chennai and if the enquiry is conducted, the rights of the petitioner will be in jeopardy and further stated that defending himself in two different Forums will cause tremendous mental agony and financial strains. A copy of the said letter is filed among the typed set of papers. The learned Senior Counsel relying upon the said letter submitted that only due to the said request of the petitioner the enquiry was not proceeded with and no finality was reached in the departmental proceeding, and for the delay in completing the disciplinary proceeding, the management should not be blamed. Learned Senior Counsel also submitted that if a direction is issued to complete the disciplinary proceeding within a stipulated period and if the petitioner extends his co-operation, the management is willing to complete the entire proceedings within the stipulated time.
14. Issue No.2: As regards the issue of non-application of mind raised by the learned counsel for the petitioner in respect of extension of suspension order, it is to be noted that the order dated 6.6.2005 is only an extension of the earlier suspension order.
15. The order of suspension dated 7.12.1993 specifically states that the continuance of petitioner in duty is likely to prejudice investigation, enquiry or trial. Even according to the petitioner, the investigation in the criminal case and the trial in the criminal case alone were over and the enquiry in the disciplinary proceeding is yet to be over. Hence the reason stated in the original order of suspension dated 7.12.1993 holds good for the continuance of suspension by order dated 6.6.2005.
16. The learned Senior Counsel submitted that as against the judgment of the criminal Court, the CBI has filed an appeal before this Court in Crl.A.No.501 of 2005 and the same has been admitted and pending, which was also informed to the department by the Superintendent of Police, CBI, vide his letter dated 19.7.2005 and therefore the criminal Court decision, namely, the acquittal of the petitioner, has not become final. Hence, the learned Senior Counsel submitted that the appeal is to be treated as continuation of original proceedings, and the petitioner has no right to demand for setting aside the suspension order during the pendency of criminal appeal and pending enquiry in the departmental proceedings and consequently, the contention raised by the counsel for the petitioner that the order of extension does not contain reasons and therefore the non-application of mind is writ large, is unsustainable.
17. (a) The decision cited by the learned counsel for the petitioner in 2003 WLR 644 (C.Baskaran v. The Managing Director, Tamil nadu State Transport Corporation, Dindigul & others) will not help the petitioner since the very same suspension order, impugned in this writ petition, was already upheld by this Court by order dated 22.8.2003 in W.P.No.15495 of 2002. The only change of circumstance is that the criminal Court acquitted the petitioner by giving benefit of doubt as against which a criminal appeal referred to above has been admitted and pending before this Court.
(b) In the decision of this Court relied on by the learned counsel appearing for the petitioner reported in 2002 WLR 546 (A.Boopalan v. The Assistant Director, Khadi and Village Industries and another), there was a delay in concluding the disciplinary proceeding for more than ten years without any reason on the part of the management and therefore this Court held that the disciplinary proceeding can be concluded and the petitioner therein may be posted to any non-sensitive post. Here in this case, the disciplinary proceeding was not proceeded with because of the the request made by the petitioner through his letter dated 27.3.1997 as stated supra and therefore the delay is attributable only against the petitioner and not against the management for not concluding the disciplinary proceeding.
(c) In another decision cited by the learned counsel appearing for the petitioner reported in 1996 WLR 332 (K.Thangaraj v. The Managing Director, Dheeran Chinnamalai Transport Corporation Limited, Tiruchirapalli) the suspension order was quashed on the ground that the charge was too trivial in nature. The facts in that case was entirely different because the charges levelled against the petitioner herein are very serious in nature.
(d) In AIR 1984 SC 626 (Corporation of Nagpur v. Ramchandra G.Modak) at paragraph 6 the question dealt with by the Supreme Court was, if the accused is acquitted in the criminal case whether or not the departmental inquiry pending against him would have to continue. The Honourable Supreme Court held that this is entirely the discretion of the disciplinary authority and normally where the accused is acquitted honourably and completely exonerated of the charges it would not be expedient to continue a departmental inquiry on the very same charges. In the said case it is further held that merely because he is acquitted, the power of the authority to continue the departmental inquiry is not taken away nor its discretion in any way fettered. If the authority feels that there is sufficient evidence and good grounds to proceed with, it can certainly do so. In the said case, the inquiry was almost completed and only the final order was to be passed and taking note of the facts of the said case, the Court set aside the order of suspension and directed to pass final orders in the disciplinary proceeding.
(e) In (1994)28 Administrative Tribunal Cases 711 (Sulekh Chand v. Commissioner of Police) the acquittal by the criminal Court was on merits and not on the ground of giving benefit of doubt. Hence the said decision has no application to the facts of this case.
18. The learned senior Counsel for the respondents cited a very recent decision of a Division Bench of this Court reported in (2006) 1 MLJ 511 (Indian Overseas Bank v. P.Ganesan) for the proposition that the proceedings in a criminal case and departmental proceeding against the same person are entirely different.
19. The power of the department to place an officer under suspension pending enquiry in the disciplinary proceeding is well settled. In the decision reported in AIR 1972 SC 554 (P.R.Nayak v. Union of India), the Honourable Supreme Court considered the power of suspension conferred in Rule 3 of the All India Services (Discipline and Appeal) Rules, 1969, and held that when the rule provides for passing an order of ad-interim suspension of an employee during pendency of the enquiry, in respect of certain charges, is well within the power. In the said case, the pending enquiry into the charges were only contemplated and in fact, charges were not pending on the date of suspension. Taking note of the said fact, the Honourable Supreme Court held that the order of suspension being contrary to Rule 3 of the All India Services (Discipline and Appeal) Rules, 1969, the suspension order was unsustainable.
20. In this case, the sub-regulation (1) of Regulation 33 of ONGC CDA Rules, 1994 as amended from time to time empowers the management to suspend the petitioner, when a disciplinary proceeding against him is contemplated or is pending. Therefore the petitioner cannot contend that the suspension order presently extended is bad. The said rule also enables the employee to approach the department to revoke the order of suspension and it is open to the management to modify or revoke the order of suspension at its discretion. Therefore it is clear that the impugned order of suspension as extended, is sustainable in all respects.
21. On a careful analysis of the above cited decisions, to meet the ends of justice, there will be a direction to the respondents to complete the disciplinary proceedings within a period of six months from the date of receipt of copy of this order. Petitioner is at liberty to seek for revocation of the order of suspension as provided in the CDA Rules, 1994 and it is upto the responde nts to accept or reject the same.
22. The writ petition is dismissed with the above direction. No costs. Connected WPMP No.23765 of 2005 is also dismissed.
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