Kerala High Court
C.S. Kesavan vs State Of Kerala And Ors. on 13 December, 1988
Equivalent citations: [1989]176ITR375(KER), (1989)ILLJ404KER, [1989]72STC432(KER)
JUDGMENT
1. The petitioner, while working as Member (Departmental), Kerala Agricultural Income-tax and Sales Tax Appellate Tribunal, Additional Bench, Ernakulam, retired from service on October 31, 1983, on superannuation. On retirement, the pensionary benefits and gratuity that were legitimately due to him were not paid without undue delay. A provisional pension at the rate of Rs. 588 per month was sanctioned as per order dated May 10, 1984. Full pension at the rate of. Rs. 807 was sanctioned as per exhibit P-7 order dated July 19, 1984. After deducting a sum of Rs. 798.53 from out of the Death-cum-Retirement Gratuity, the balance amounting to Rs. 28,076.47 was also sanctioned to the petitioner by exhibit P-7. The petitioner now claims interest at 12% per annum on the various amounts on account of the delayed payment in the following terms :
(a) on full pension of Rs. 807 plus DAC Rs. 388 per month from November 1, 1983 to July 3, 1984 ;
(b) on the differential value of pension at Rs. 269 per month from July 4, 1984 to August 23, 1984 ;
(c) on gratuity of Rs. 28,875 per month from November 1, 1983, to Septembers, 1984 ;
(d) on commuted pension of Rs. 55,228 from November 1, 1983, to December 11, 1984 ;
(e) on refund of the sum of Rs. 798.53 unlawfully recovered.
2. A detailed counter-affidavit has been filed on behalf of the Secretary, Board of Revenue (Taxes), second respondent. A superintendent of the Board of Revenue has sworn to the counter-affidavit, The contentions raised therein are that on account of the pendency of disciplinary proceedings against the petitioner, the Government sanctioned 2/3rds of the pension as provisional pension, that the Government sanctioned final pension and Death-cum-Retirement Gratuity, and the claims were authorised on August 13, 1984, after withholding liability of Rs. 798.53 fixed by the Government and Rs. 89 as per the records, that the provisional pension under Rule 3A, Part III, K. S. R., alone could be sanctioned on account of the disciplinary proceedings pending against the petitioner, that the disciplinary proceedings could be finalised only after observing the procedural formalities as per the statutes, that there had been no wilful delay and that the Board of Revenue had no intention to delay the payment of the petitioner's retirement benefits and, on this basis, it is contended that the petitioner is not entitled to any of the reliefs asked for.
3. Exhibit P-2 is a communication addressed to the petitioner from the Board of Revenue. It is stated therein that disciplinary action is pending before the Government against the petitioner in connection with the irregular orders passed by him in the revision case relating to Sri N.S.K.K. Palanichamy, cardamom planter. In that proceeding, the loss to the Revenue has been assessed at Rs. 798.53. The petitioner was, accordingly, informed that in case he was agreeable to remit the said amount or to adjust the same from the Death-cum-Retirement Gratuity, the matter can be referred to the Government and disciplinary action finalised so as to settle the pensionary claims. On receipt of this communication, the petitioner sent exhibit P-3 letter agreeing to have the said amount adjusted from out of the Death-cum-Retirement Gratuity, "under protest and pain of insult". Subsequently, the petitioner was served with exhibit P-5 communication dated October 10, 1984, from the Government informing him that no disciplinary proceeding was initiated against him and that the recovery of loss to Government was ordered under the provisions of Part III, K.S.R.
4. Learned Government Pleader made available to me the entire files of the Board of Revenue relating to the petitioner's claim for retirement benefits. Files show that disciplinary action was taken against the petitioner in relation to an order passed by him in a revision case relating to the assessment made on one Sri N.S.K.K. Palanichamy. The order which lead to the disciplinary action was one passed by the petitioner in exercise of his jurisdiction as Deputy Commissioner (Appeals). Exhibit P-6 order of the Government is proof positive of the fact that such disciplinary action was taken against the petitioner. According to the Government, due to the irregular order passed by the petitioner in the revision filed by Sri Palanichamy on January 29, 1981, the Government sustained a loss of revenue of Rs. 798.53. There is nothing on record to show that this loss was assessed after affording the petitioner an opportunity of being heard in the matter. No notice of any proceeding for this purpose is seen issued to him. No type of adjudication is seen to have been made either. As Deputy Commissioner (Appeals), the petitioner was invested with appellate jurisdiction over orders passed by the assessing authorities. In exercise of that judicial function, he might have reversed the order passed by the assessing authority. If the order passed in appeal has gone against the interest of the Government, the only course that was open to the Government was to challenge the order passed by the appellate authority before the higher forums as per the provisions contained in the Kerala Agricultural Income-tax and Sales Tax Acts. Without recourse to such a step, the Government cannot proceed against the Deputy Commissioner (Appeals) and recover the loss from him. Officers invested with quasi-judicial powers are to discharge their functions without fear of disciplinary action. If the officers invested with such powers are under the threat of disciplinary action on account of orders passed against the interest of the Government, it will interfere with their judicial discretion. It will result in a travesty of justice. Officers entrusted with authority to decide issues arising between citizens and the Government should have the freedom to take independent decisions in accordance with law. If their decisions go against the interest of the Government, the Government have to challenge those orders before the appellate or revisional forums as provided by the statute. The orders passed by such officers cannot subject them to disciplinary proceedings. In the instant case, from the files produced before the court, it appears that in the appeal filed by Sri N.S.K.K. Palanichamy, the petitioner exercising his appellate power had passed an order against the Government. The Government, therefore, took the view that on account of the said decision, they sustained a loss of Rs. 798.53. Even if such a loss has been occasioned by virtue of the order passed by the petitioner in his capacity as Deputy Commissioner (Appeals), the Government have no authority to realise that loss from the petitioner. So, the disciplinary action initiated against the petitioner was ill-conceived. Such a step has to be condemned. In a country where the rule of law is enshrined in the Constitution itself, the action taken by the Government is to be treated as a retrograde step undermining the rule of law. So, I have no hesitation in holding that the Government was clearly in error in initiating disciplinary action against the petitioner and in withholding an amount of Rs. 798.53 from out of the Death-cum-Retirement Gratuity as loss sustained by the Government.
5. But for the illegal disciplinary proceedings initiated against the petitioner, the petitioner would have got the entire retirement benefits immediately on his retirement. On the facts and circumstances of this case, as stated by the Supreme Court in State of Kerala v. M. Padmanabhan Nair, AIR 1985 SC 356, it would not be unreasonable to direct the Government to pay penal interest on the amounts due to the petitioner from the date of expiry of two months from the date of retirement till the date of payment.
6. The petitioner was granted a provisional pension by exhibit P-2 order dated June 5, 1984. He was granted final pension by exhibit P-7 order dated July 19, 1984. The dates on which the provisional pension and final pension were actually drawn by the petitioner are not known from the records made available to the court. The petitioner was entitled to Death-cum-Retirement-Gratuity amounting to Rs. 28,875. Out of that amount, Rs. 798.53 was deducted as the loss sustained by the Government on account of the order passed by the petitioner in appeal while exercising the jurisdiction as Deputy Commissioner (Appeals). So, the actual amount of the Death-cum-Retirement-Gratuity drawn by the petitioner was Rs. 28,076.47 only. He got that amount on September 3, 1984. That amount must carry interest at the rate of 12% per annum from January 1, 1984, to September 2, 1984. The petitioner is entitled to that interest. The Government had no authority to deduct Rs. 798.53 from the Death-cum-Retirement-Gratuity due to the petitioner. The petitioner is entitled to get back that amount together with interest at the rate of 12% per annum from January 1, 1984, till the date of payment.
7. In view of what has been stated above, I direct the respondents to pay the petitioner interest on Rs. 28,076.47 at the rate of 12% per annum from January 1, 1984, to September 2, 1984. The respondents must also pay the petitioner a sum of Rs. 798.53 with interest at 12% per annum from January 1, 1984, till the date of payment. These amounts should be paid to the petitioner within three months from the date of receipt of a copy of this judgment. In case the amount is not so paid within the said period, the total amount will carry future interest at the rate of 18% per annum till the date of payment. The petitioner is entitled to his costs in this original petition including advocate's fee of Rs. 750.
8. Before parting with the case, I would like to impress upon the Government the illegal and arbitrary step taken by it in initiating disciplinary action against an officer in regard to the order passed by him in the discharge of his judicial function. Officers entrusted with such duties must be given freedom to discharge their duties in accordance with their judicial discretion. They should not be placed under the threat of disciplinary action for the judicial orders passed by them. In this case, the Government may consider the possibility of recovering the amounts directed to be paid to the petitioner, from the person who was responsible for initiating action against the petitioner on account of the judicial order passed by him in exercise of his powers as Deputy Commissioner (Appeals). Any step initiated in this direction by the Government will prevent recurrence of such incidents in future.
9. The original petition is disposed of in the above terms.
10. Forward a copy of this judgment to the Chief Secretary to the Government for necessary action.
11. Issue carbon copy of the judgment to the parties on usual terms.