Patna High Court
Jeevan Kumar Jayaswal vs The New India Assurance Co. Ltd. And Ors. on 3 May, 2000
Equivalent citations: 2000(3)BLJR1943
Author: A.K. Ganguly
Bench: A.K. Ganguly
JUDGMENT A.K. Ganguly, J.
1. This writ petition has been filed for quashing the order dated 2.9.1992 issued under the signature of the Regional Manager-cum-Competent authority, New India Assurance Company Limited (hereinafter called the said Company. By the said order, the petitioner has been removed from service with effect from the date of the order. Prayer has also been made for quashing the appellate order dated 5.2.1996 by which the order of removal has been affirmed.
2. The case of the petitioner is that he was first appointed a Development Officer in the said Company. While so serving as a Development Officer of the said Company, the petitioner was served with a charge-sheet by a letter dated 5.8.1986, The charges on the basis of which the proceeding was initiated against the petitioner are set out below:
It has been reported against you that while acting as an Inspector of the Company, you had issued a temporary Fire Insurance Cover Note No. 233024 dated 24.11.82 at Monghyr to cover the fire insurance risk amounting to Rs. 10,20,000/- of the Building, Plant and Machinery, Furniture Fixtures and Racks and Electrical fittings of Khajpura Cold Storage (P) Ltd., Bailey Road, Patna though you were not authorised to issue such temporary Cover Notes, without referring the proposal for insurance to the Divisional Office at Patna for its verification and acceptance. You have thereby acted without authority and beyond authority.
It has been further reported that your said temporary Cover Note was a backdated one in order to give a backdated Fire Insurance Cover for the damages to the said Khajpura Cold Storage already caused by fire on the night of 24.11.82. You have thereby acted fraudulently and dishonestly in connection with the business of the Company.
The acts as alleged above, if proved to be true, would make you liable for disciplinary action. You are, therefore, asked to show-cause in writing within 10 days from the receipt hereof as to why suitable disciplinary action should not be taken against you for the following misconduct:
(a) Acting without authority and/or beyond authority.
(b) Fraud and dishonesty in connection with the business of the Company.
(c) Acting in a manner prejudicial to the Company.
If you fail to show-cause as directed, it would be deemed that you have no explanation to offer and the matter will be decided without further reference to you.
Statements of allegations on which the charges are based are given hereinabove in the body of the charge-sheet itself.
A list of documents by which and a list of witnesses by whom the articles of charges are proposed to be sustained are given in Annexures marked as 'A' and 'B' respectively.
3. From a perusal of the said charge-sheet, it appears that the temporary Fire Insurance Cover Note is dated 24.11.1982 and the fire took place in the said Khajpura Cold Storage on the night of that date itself, i.e., 24.11.1982 and one of the allegations against the petitioner is that the said temporary cover note was backdated. However, along with the charges lists of documents and the list of witnesses were also disclosed. A detailed inquiry took place in which the petitioner participated. The petitioner was also given the help of a defence helper. It appears that in the said inquiry witnesses were produced, examined and cross-examined. After the inquiry was over, the inquiry officer gave a detailed report holding that out of the three charges, the first charge, i.e., acting without authority and/or beyond authority was not proved and charge Nos. 2 and 3, namely, fraud and dishonesty in connection with the business of the Company and acting in a manner prejudicial to the Company have been proved. On the basis of the said inquiry report a second show-cause notice was also given to the petitioner and the petitioner has given his reply to the same. Thereafter, on consideration of the petitioner's reply to the second show-cause notice, the respondent authorities passed the order of removal from service.
4. Against the said order of removal, as already noted above, the petitioner's appeal has also been dismissed.
5. Two points have been urged by the learned Counsel for the petitioner before this Court. The first is that the departmental proceeding has not been held in accordance with law and as a result of which he has been deprived of the reasonable opportunity of defence. In support of the said contention, reliance was placed on paragraphs 12, 13, and 14 of the writ petition.
6. The second point urged is that the appellate-authority has not properly considered the appeal in terms of the Appeal regulations which are statutory in character. This Court proposes to deal with the second point first. In fact, if the second point succeeds in that case, the matter has to be remanded for re-consideration by the appellate-authority which can examine the validity of the first point. Any decision of this Court on the first point may stultify such reconsideration.
7. In order to appreciate the validity of the second point the relevant appeal regulation, namely, Regulation 37 of the General Insurance (Con duct, Discipline and Appeal) Rules, 1975 is set out below:
37. Consideration of Appeals.-(1) In the case of an appeal against an order of suspension, the appellate-authority shall consider whether in the light of the provisions of Rule 20 and having regard to the circumstances of the case the order of suspension is justified or not and confirm or revoke the order accordingly.
(2) In the case of an appeal against an order imposing any of the penalties specified in Rule 23, the appellate-authority shall consider:
(a) whether the procedure prescribed in these Rules has been complied with, and if not, whether such non-compliance has resulted in failure of justice;
(b) whether the findings are justified; and
(c) whether the penalty imposed is excessive, adequate or inadequate, and pass orders:
(i) setting aside, reducing, confirming or enhancing the penalty; or
(ii) remitting the case to the authority which imposed the penalty or to any other authority with such direction as it may deem fit in the circumstances of the case.
Provided that:
(i) the appellate-authority shall not impose any enhanced penalty which neither such authority nor the authority which made the order appealed against is competent in the case to impose.
(ii) no order imposing an enhanced penalty shall be passed unless the appellant is given an opportunity of taking any representation which he may wish to make against such enhanced penalty; and
(iii) if the enhanced penalty with the appellate-authority proposes to impose is one of the penalties in Clauses (b) to (g) of Rule 23, and an inquiry under the said Rule has not already been held in the case, the appellate-authority shall itself hold such inquiry or direct that such inquiry be held and thereafter on consideration of the proceedings of such inquiry and after giving the appellant an opportunity of making any representation which he may wish to make against such penalty, pass such orders as it may deem fit.
(3) All appeals should be disposed of as expeditiously as possible and in any event not later than 6 months from the date of receipt of the appeal by the appellate-authority.
8. From a perusal of the said regulation, it appears that in a case of appeal against an order imposing penalty, the appellate authority is to consider (a) whether the procedure prescribed in these Rules has been complied with, and if not, whether such non-compliance has resulted in failure of justice, (b) whether the findings are justified, and (c) whether the penalty imposed is excessive, adequate or inadequate.
9. From a perusal of the appellate order which is at Annexure-1, this Court finds that the appellate-authority after reciting the facts of the case gave its own finding only in the following words:
I have perused the inquiry report, and the Appeal of Mr. Jaiswal along with all other connected papers. On overall consideration of all the facts and circumstances of the case, I do not find any merit to reopen this case for treating his offence with leniency and review the punishment awarded by the competent Authority. I, therefore, reject the Appeal and confirm the order of the competent Authority.
10. It appears from the aforesaid consideration by the appellate-authority that the said consideration has not been made in accordance with regulation 37(2)(a)(b) and (c) of the said appeal regulation.
11. Similar appeal regulation came up for consideration by the Hon'ble Supreme Court in the case of R.P. Bhatt v. Union of India and Ors. reported in 1985 (3) SLR 745. In R.P. Bhatt (supra), Rule 27(2) of the Central Civil Services (Classification, Control and Appeal) Rules, 1965 which provides for the duties of the appellate-authority came up for consideration. Rule 27(2) of the said Rules is set out below:
27(2). In the case of an appeal against an order imposing any of the penalties specified in Rule 11 or enhancing any penalty imposed under the said Rules, the appellate-authority shall consider:
(a) whether the procedure laid down in these Rules has been complied with and if not, whether such non-compliance has resulted in the violation of any provisions of the Constitution of India or in the failure of justice;
(b) whether the findings of the disciplinary authority are warranted by the evidence on the record; and
(c) whether the penalty or the enhanced penalty imposed is adequate, inadequate or severe; and pass orders:
(i) Confirming, enhancing, reducing, or setting aside the penalty; or
(ii) remitting the case to the authority which imposed or enhanced the penalty or to any other authority with such direction as it may deem fit in the circumstances of the case.
12. In the case of R.P. Bhatt also, there was no proper consideration by the appellate-authority of the appeal of the employee concerned in ac cordance with the different heads of such consideration mentioned in the appeal regulation. Therefore, commenting upon the said order of the Director-General, who was the appellate authority in the case of R.P. Bhatt, (supra) the Honnle Supreme Court observed as follows:
There is no indication in the impugned order that the Director General was satisfied as to whether the procedure laid down in the Rules had been complied with; and if not, whether such non-compliance had resulted in violation of any of the provisions of the Constitution or in failure of justice. We regret to find that the Director-General has also not given any finding on the crucial question as to whether the findings of the disciplinary authority were warranted by the evidence on record. It seems that he only applied his mind to the requirement of Clause (c) of Rule 27(2), viz. whether the penalty imposed was adequate or justified in the facts and circumstances of the present case. There being non-compliance with the requirements of Rule 27(2) of the Rules, the impugned order passed by the Director-General is liable to be set aside.
13. The same observation can be applied to the present appeal order also. In the appeal order under consideration, there is no finding given by the appellate-authority on the crucial questions, namely, whether the findings of the disciplinary authority are warranted by the evidence on record. Therefore, applying the said principle, as set out above, this Court cannot uphold the appellate order.
14. In a subsequent decision of the Supreme Court in the case of Ram Chander v. Union of India and Ors. 1986 Lab. I.C. 885 : AIR 1986 S.C. 1173, the Hon'ble Supreme Court again considered the appeal provisions in similar terms in Rule 22(2) of the Railway Servants (Discipline and Appeal) Rules, 1968. In the case of Ram Chander (supra), the decision of the Supreme Court in the case of R.P. Bhatt (supra), was relied upon. As a general proposition, it has been stated in Ram Chander (supra) that in absence of any requirement in the Statute or the Rules, there is no obligation cast upon the appellate-authority to give reasons where the appellate order is one of affirmance. Recording the said general proposition, the Hon'ble Supreme Court came to the conclusion that when the Rules require the appellate-authority to apply its mind to specific items of consideration, it is incumbent upon the appellate-authority to disclose its reasoned findings. On those principles the appellate order was set aside in paragraph 5 of the said judgment in the following words:
To say the least, this is just a mechanical reproduction of the phraseology of Rule 22(2) of the Railway Servants Rules without any attempt on the part of the Railway Board either to marshal the evidence on record with a view to decide whether the findings arrived at by the disciplinary authority could be sustained or not. There is also no indication that the Railway Board applied its mind as to whether the act of misconduct with which the appellant was charged together with the attendant circumstances and the past record of the appellant were such that he should have been visited with the extreme penalty of removal from service for a single lapse in a span of 24 years of service. Dismissal or removal from service is a matter of grave concern to a civil servant who, after such a long period of service, may not deserve such a harsh punishment. There being noncompliance with the requirements of Rule 22(2) of the Railway Servants Rules, the impugned order passed by the Railway Board is liable to be set aside.
15. The learned Judges of the Supreme Court in Ram Chander (supra) emphasised the requirement of reasoned decision by the appellate authority in order to promote public confidence in the administrative process. Their Lordships observed in paragraph 24 at page 894 of the report as follows:
We wish to emphasize that reasoned decisions by tribunals, such as the Railway Board in the present case, will promote public confidence in the administrative process. An objective consideration is possible only if the delinquent servant is heard and given a chance to satisfy the Authority regarding the final orders that may be passed on his appeal. Considerations of fair play and justice also require that such a personal hearing should be given.
16. This Court is in respectful agreement with the aforesaid proposition.
17. Learned Counsel for the respondents has, however, placed reliance on a subsequent judgment of the Supreme Court in the case of State Bank of India v. S.S. Koshal reported in 1994 BBCJ 218 (SC). In the case of Koshal (Supra), the learned Judges were considering a different appeal provisions, namely, Rule 51(2) of the relevant service Rules. Rule 51(2) of the relevant service Rules does not cast such specific duty on the appellate-authority as is cast in the Rules quoted above and also in the Rule under consideration, namely, Rule 37(2) of the said rules. The relevant portion of Rule 51(2) of the relevant service Rule in Koshal (supra) is set out below:
The appellate Authority shall consider whether the findings are justified and/or whether the penalty is excessive or inadequate. Authority may pass an order confirming, enhancing, reducing or setting aside the penalty or remitting the case to the authority which imposed the penalty or to any other authority with such directions as it deems fit in the circumstances of the case.
18. Commenting on the said Rule, the learned Judges of the Supreme Court held that even if it agrees with the High Court's finding that the appellate-authority while acting under the said Rule is required to give a reasoned order, but since the appellate order satisfies the test of a reasoned order, the appellate order was confirmed by the Hon'ble Supreme Court.
19. It does not appear that while passing the said Judgment in Koshal (Supra) the attention of the learned Judges of the Supreme Court was drawn to its two previous judgments in the cases of R.P. Bhatt (supra) and Ram Chander (supra) where a consistent view has been taken. In any event in the case of Koshal (supra) also, the learned Judges of the Supreme Court have taken the view that the appellate-authority is to pass a speaking order. The said view is expressed in paragraph 8 of the judgment in Koshal (supra) and the learned Judges of the Supreme Court affirmed the appellate order as in its opinion, the appellate order is a speaking one.
20. Therefore, on a conspectus of the above decision, this Court holds that in the facts of this case the appellate order has not been passed in accordance with the requirement of the appeal regulations which have been set out above and as such this Court is inclined to set aside the same and the same is hereby set aside.
21. It may be true that in some cases when the appellate-authority affirms the order of the original authority, it may not give detailed reasons but under the relevant Rules, the appellate-authority has to apply its mind specifically to three aspects of the matter, namely, whether the procedure prescribed in these rules has been complied with and whether such non-compliance has resulted in failure of justice, the next aspect is whether the findings are justified and the third aspect is whether the penalty imposed is excessive, adequate or inadequate. The appellate-authority is under statutory obligation to give a clear finding in terms of Regulation 37(2)(a), (b) and (c). But in this case, this Court, finds that the requirements of Regulation 37(2)(a), (b) and (c) have not been complied with by the appellate-authority in passing the appellate order.
22. Therefore, this Court quashes the appellate order dated 5.2.1996 and directs the appellate authority to re-consider the petitioner's appeal in the light of Regulation 37(2)(a), (b) & (c) of the said Regulation as set out above and thereafter pass a fresh order on the petitioner's appeal within a period of three months from the date of receipt/service of a copy of this order on him. This Court makes it clear that this Court has not made any observation on the merits of the petitioner's case and the appellate-authority is free to arrive at its own conclusion on the merits of the appeal but while coming to such conclusion, it must give its specific finding on the point mentioned in the appeal regulations. This Court, however, also directs the appellate-authority to give the writ petitioner a personal hearing before disposal of his appeal.
23. This writ petition is, thus, allowed to the limited extent indicated above. There will be no order as to cost.