WP/32091/2013 of The Union of India, rep.by the The General Manager, Vs A.S.Acharyulu, on 31 December 2013

HON’BLE SRI JUSTICE R. SUBHASH REDDYAND

HON’BLE SRI JUSTICE A. SHANKAR NARAYANA

Writ Petition No.32091 of 2013stDate: 31 December 2013

Between:

The Union of India and others

… Petitioners

And

A.S. Acharyulu and others

… Respondents

Order:(Per Justice R. Subhash Reddy)

Respondents 1 to 3 in O.A.No.11 of 2011 before theCentral Administrative Tribunal, Hyderabad Bench atHyderabad (for short “the Tribunal”) have filed this Writ Petitionchallenging the order dated 19.04.2013, by which theTribunal allowed the said O.A., filed by the 1[st] respondentherein questioning the validity of the order dated09.05.2009 passed vide proceedingsNo.N/B/C.DAR/Vig/Major/03/2008, by the disciplinaryauthority imposing on him the penalty of compulsoryretirement, and, further the order dated 02.11.2010 passedvide proceedings No.N/B/C.DAR/Vig/Major/03/2008, by theappellate authority dismissing his appeal.

2. The 1[st] respondent-applicant was working as SeniorBooking Clerk in Ninadavole Railway Station of SouthCentral Railway. On 25.03.2008, while the 1[st] respondent-applicant was on duty, a decoy check was conducted bythe petitioners herein. On an allegation that he demandedand accepted Rs.100/- over and above the actual freightcharge of Rs.283/-, disciplinary proceedings were initiatedagainst him under Railway Servants (Disciplinary & Appeal)Rules, 1968 (for short “the Rules”). In the disciplinaryproceedings, charge has been framed against the 1[st]respondent-applicant, which reads as under:

“That the said Sri A.S.R. Acharyulu, SBC/NDD, whileworking as Parcel Clerk in Parcel office/NDDdemanded and accepted Rs.100/- over and above theactual freight of Rs.283/- for booking a motorcycle exNDD to VSKP, which was booked vide PW BillNo.:525677, dt.25/03/2008.

By the above act of omission and commission, SriA.S.R. Acharyulu, SBC/NDD has shown lack ofabsolute integrity, displayed lack of devotion to dutyand has acted in manner unbecoming of a Railwayservant, contravening provisions of Rules No.:3(1) (i) (ii)& (iii) Railway Services (Conduct) Rules, 1966.”

3. When the charge memo was served on the 1[st]respondent-applicant, he submitted his explanation on17.07.2008 denying the charge levelled against him. Thedisciplinary authority, dissatisfied with the explanationoffered by him, ordered for regular inquiry. Regular inquirywas conducted in Case File No.G77/II/KMV/06/2008. The inquiry officer submitted his report after completing theinquiry by recording a finding that the charge framed againstthe 1[st] respondent-applicant is partly proved. The operativeportion of the report reads as under:

“The contention of the CD in his defence suits to nix theallegation for demand aspect. But there is no justifiablereason to collect Rs.100/- excess in differentdenominations from the CE and to keep on the table. For bargaining with licensed porters, he should havedirected the decoy to them by collecting only freightcharges. As such, there is no justification to collectexcess amount and to keep the same on the table indifferent denominations, though the same amount wasnot kept in either cash chest or in his personalpossession. His contention, that he intended to returnthe same to the decoy for bargaining with licensedporters, found no logic. However, it appears that thetransaction was not ripe to arrive at a conclusion thatthe CE had collected the excess amount by demand forillegal gratification. Hence, the outright demand aspectin the check is not established in a cogent manner. Butthe availability of denominations of G.C. Notes recordedin Ex.P.1 on the table of the CE (Notes worth ofRs.100/-) speaks in favour of the collection aspect. Though the CE claimed in Ex.P.16 that he had not seenthe amount kept on the table. Thus, the charge isproved to the extent of CE collecting Rs.100/- over andabove the actual freight of Rs.283/- for booking Motor-cycle on PW.Bill No.525677 dated 25.03.08 Ex.NDD toVSKP.”

4. On submission of the inquiry report by the inquiryofficer to the disciplinary authority, the disciplinaryauthority disagreed with the findings of the inquiry officer and without giving any further opportunity to the 1[st]respondent-applicant, passed final order dated09.05.2009 vide proceedingsNo.N/B/C.DAR/Vig/Major/03/2008 imposing penalty ofcompulsory retirement on him. As against the said orderof the disciplinary authority, the 1[st] respondent-applicantcarried the matter by way of appeal as contemplatedunder Rule 22 of the Rules. The appellate authority, also, byfurther order dated 02.11.2010 passed vide proceedingsNo.N/B/C.DAR/Vig/Major/03/2008, dismissed the appeal. As against both the orders, the 1[st] respondent-applicantfiled the O.A., before the Tribunal. The Tribunal, by theimpugned order, while agreeing with the findings of theinquiry officer, held that the motorcycle produced by thedecoy was not in a packed condition and for the purposeof packing, the amount has to be paid by the decoyhimself and further, as found by the inquiry officer, thatRs.100/- was on the table along with the receipt, furtherheld that there is no material to prove that the 1[st]respondent-applicant demanded and collected Rs.100/-. The Tribunal also found that, when the disciplinaryauthority disagreed with the findings of the inquiry officer,it is the duty of the disciplinary authority to record itsdisagreement note, but in the instant case, without anysuch disagreement note, the disciplinary authority proceeded to pass final order imposing the penalty ofcompulsory retirement on the 1[st] respondent-applicant. The Tribunal, further recording a finding that the appellateauthority did not pass speaking order, allowed the O.A.,by the impugned order, and quashed the order dated02.11.2010 passed by the appellate authority andordered for payment of consequential benefits to the 1[st]respondent-applicant.

5. Heard Sri A. Krishnam Raju, learned standingcounsel for the petitioners, Sri K.R.K.V. Prasad, learnedcounsel for the 1[st] respondent-applicant and perused the material onrecord.

6. It is submitted by the learned counsel for thepetitioners that disciplinary proceedings are conducted inaccordance with the Rules, as such, there is no illegalityin the procedure adopted by the petitioners; when theinquiry officer recorded his findings, it is not open to theTribunal to re-appreciate the evidence on record so as togive its own conclusions; as the Rules do not provide forgiving any further opportunity and when the disciplinaryauthority did not agree with the findings recorded by theinquiry officer, it cannot be said that inquiry is notconducted as per the Rules. Lastly, it is submitted that, inany event, as the 1[st] respondent-applicant was out ofservice, by applying the principle “no-work-no-pay”, he is not entitled for salary for the period he was out of service. In support of his argument that in case opportunity is to begiven to the 1[st] respondent-applicant further, the matterhas to go back for conducting proceedings from thatstage, learned counsel for the petitioners relied on ajudgment of the Hon’ble Supreme Court in MathuraPrasad v. Union of India and others[[1]].

7. Per contra, it is submitted by the learned counsel forthe

1[st] respondent-applicant that, in this case, in the absenceof any evidence against the 1[st] respondent-applicant,disciplinary proceedings were against him on the falseallegation that he collected Rs.100/- over and above thefreight charge of Rs.283/-. It is further submitted that thereis no evidence at all to prove the charge and the very factthat Rs.100/- was put on the table along with thebill/receipt itself indicates that the 1[st] respondent-applicantdid not receive the said amount, which was to be paid tothe porter towards expenses for packing the motorcycle;though the charge is not proved, the disciplinary authority,in gross violation of the principles of natural justice, andcontrary to the evidence on record, imposed the penaltyof compulsory retirement, which was upheld by theappellate authority; as the order of the disciplinaryauthority is ex facie illegal and not passed on acceptablematerial on record, the Tribunal has rightly allowed the O.A., filed by the 1[st] respondent-applicant and there areno grounds to interfere with the same; when thedisciplinary authority did not agree with the findingsrecorded by the inquiry officer, unless reasons arerecorded by giving opportunity to differ with the findings, itis not open to the disciplinary authority to pass final orderimposing penalty; such an action on the part of thepetitioners is ex facie illegal and contrary to the Rules, assuch, the Tribunal has rightly set aside the ordersimpugned in the O.A. Lastly, it is submitted that as the 1[st]respondent-applicant was kept out of service without anyvalid reason based on the false allegations, as such, he isentitled for all consequential benefits, which would flowfrom setting aside the orders of the disciplinary authorityand the appellate authority.

8. In this case, it is to be noticed that disciplinaryproceedings are covered by the Railway Servants(Disciplinary & Appeal) Rules, 1968, which are framed inexercise of powers under proviso to Article 309 of theConstitution of India. The allegation against the 1[st] respondent-applicant, in this case, is that hedemanded and accepted Rs.100/- over and above theactual freight charge of Rs.283/- for booking Motor-cycleon PW.Bill No.525677 dated 25.03.2008 Ex.NDD toVSKP. A detailed inquiry was conducted by the inquiryofficer. The inquiry officer himself disapproved thedemand for illegal gratification, but approved collection of Rs.100/- over and above the freight charge, which wasfound on the table along with the bill. In the inquiry, thedecoy himself deposed that the motorcycle was not in apacked condition and Rs.100/- was paid over and abovethe freight charge, by bargaining with the porter. In spiteof the fact that the charge of demand as framed in thedisciplinary proceedings is not proved, the disciplinaryauthority disagreed with the findings of the inquiry officerand imposed penalty of compulsory retirement.

At this juncture, it is apposite to notice the relevant Rule,i.e. Rule 10 (1) to (3), which reads as under:

“10. Action on the inquiry report. (1) If the disciplinaryauthority, having regard to its own findings where it isitself the inquiry authority, or having regard to itsdecision on all or any of the findings of the inquiryauthority, is of the opinion that the penalty warranted issuch as is within its competence, that authority may acton the evidence on the record or may, if it is of theopinion that further examination of any of the witnessesis necessary in the interests of justice, recall the witnessand examine, cross-examine and re-examine thewitness and may impose on the railway servant suchpenalty as is within its competence in accordance withthese rules. Where such disciplinary authority is of theopinion that the penalty warranted is such as is notwithin its competence, that authority shall forward therecords of the inquiry to the appropriate disciplinaryauthority who shall act in the manner as hereinafterprovided.

(2) The disciplinary authority, if it is not itself theinquiring authority, may, for reasons to be recorded by itin writing, remit the case to the inquiring authority forfurther inquiry and report and the inquiring authority shall thereupon proceed to hold further inquiryaccording to the provisions of Rule 9 as far as may be.

(3) The disciplinary authority shall, if it disagrees withthe findings of inquiry authority on any article of charge,record its reasons for such disagreement and record itsown findings on such charge, if the evidence on recordis sufficient for the purpose.”

9. From a reading of Rule 10(3) of the Rules, it is clearthat the disciplinary authority, if it disagrees with thefindings of the inquiring authority, is empowered to recordits reasons for such disagreement and record its ownfindings on the charge, if the evidence on record issufficient for the purpose. It is well settled that if thedisciplinary authority is disagreeing with the findings of theinquiry officer, it is obligatory on the part of the disciplinaryauthority to give opportunity by recording reasons forsuch disagreement by issuing further notice beforepassing appropriate final order. In the case on hand, it isnot in dispute that though the disciplinary authoritydisagreed with the findings recorded by the inquiry officer,it had proceeded to pass final order, without any notice,by imposing penalty of compulsory retirement. It is true,there is no specific Rule for issuance of any notice, butfrom a perusal of Rule 10(3) of the Rules, it is clear thatunless charged employee is given opportunity, it is notopen to the disciplinary authority to record its own findingsin disagreement with the findings of the inquiry officer. Ifsuch a course is permitted, it would amount to grossviolation of the principles of natural justice. Without

recording any reasons for disagreement of the findings ofthe inquiry officer, it is not open to the disciplinaryauthority to simply disagree and impose penalty contraryto such findings. In normal course, when there is aprocedural lapse on the part of the authorities, the matteris to be sent back by ordering correction of steps, whichare not in conformity with law. But, in the instant case, it isto be noticed, that the check was conducted as early ason 25.03.2008 and after initiation of disciplinaryproceedings, it ended in passing of order imposingpenalty of compulsory retirement as early as on09.05.2009. Thereafter, the 1[st] respondent-applicantapproached the appellate authority, which dismissed theappeal by order dated 02.11.2010. Thereafter, he carriedthe matter to the Tribunal by way of O.A., which was,ultimately, allowed by order dated 19.04.2013. For nearlyfive long years, the 1[st] respondent-applicant was out ofservice on account of the disciplinary proceedings on theallegation of accepting Rs.100/- over and above theactual freight charge of Rs.283/. Even the inquiry officer,after elaborate inquiry, found that there was no demandby the 1[st] respondent-applicant. It is also to be noticedthat the amount of Rs.100/- was found on the table alongwith the bill/receipt which he passed for Rs.283/- towardsfreight charge. The said aspect is considered withreference to the answers given by the witness examinedduring inquiry. It appears, he was bargaining with the porter for taking the motorcycle which was kept fortransportation. As rightly held by the Tribunal, had the 1[st]respondent-applicant intended to take the said amount byway of bribe, he could not have kept the same on thetable along with the bill/receipt. In view of such findingsrecorded by the inquiry officer, and, further as the 1[st]respondent-applicant is out of service in view of the finalorder of the disciplinary authority imposing the penalty ofcompulsory retirement on him, we are of the consideredopinion that it is not a case to permit for any further inquiryhaving regard to the mental agony suffered by the 1[st]respondent-applicant for all these years.

10. Learned counsel for the petitioners has argued thatthe Tribunal has re-appreciated the evidence on recordand recorded its own findings. We have carefullyperused the impugned order passed by the Tribunal andit cannot be said that any findings are recorded by theTribunal by re-appreciating the evidence on record. Fromthe findings recorded in the inquiry, it is clear that there isno demand of Rs.100/- by the 1[st] respondent-applicant,but, at the same time, such amount was found on thetable along with the receipt/bill issued in token of receivingthe freight charge, i.e. Rs.283/-. Inasmuch as the findingsof the Tribunal are based on evidence, it cannot be saidthat the Tribunal exceeded its jurisdiction while recordingsuch findings. In any event, as the Tribunal found that theprocedure adopted by the disciplinary authority in differing

with the findings of the inquiry officer, without givingopportunity to the 1[st] respondent-applicant, is illegal, wedo not find any illegality in the impugned order of theTribunal which warrants interference. The order of thedisciplinary authority imposing penalty without notice andin the absence of recording reasons for disagreeing withthe findings of the inquiry officer is illegal. As it is not indispute that no opportunity or notice was given to the 1[st]respondent-applicant, we do not find any merit in this WritPetition which warrants interference. Though learnedcounsel for the petitioners relied on the judgment of theHon’ble Supreme Court in the case of Mathura Prasad(supra), but in the said case, when the matter wasremanded by the disciplinary authority to the inquiryofficer, the inquiry officer recorded findings without givingany opportunity and in that context, such procedure washeld to be illegal and not in conformity with the RailwayServants (Disciplinary & Appeal) Rules, 1968. In the saidjudgment, it was held that where, as a result of inquiry, anemployee is likely to be deprived of his livelihood, theprocedure prescribed must be strictly followed. Havingregard to the facts and circumstances of the case onhand, the said judgment would not render any aid to thepetitioners. However, at the same time, we do find forcein the argument put forth by the learned counsel for thepetitioners to the effect that the Tribunal ought not to haveissued directions for payment of all consequential benefits while setting aside the order of the disciplinary authority. As the 1[st] respondent-applicant was out of servicepursuant to passing final order of compulsory retirementfrom 09.02.2009, there is no reason to order for paymentof salary for the period he was out of service. In view ofthe charge framed in the disciplinary proceedings, it alsocannot be said that the disciplinary proceedings arewholly unjustified. Inasmuch as the 1[st] respondent-applicant was out of service in view of the pendency ofthe disciplinary proceedings and also the O.A., before theTribunal, though we find that the final order of thedisciplinary authority as well as that of the appellateauthority are not in conformity with law, at the same time,by applying the principle “no-work-no-pay”, we are of theview that the 1[st] respondent-applicant is not entitled forsalary for the period he was out of service. We, therefore,hold that he is entitled for continuity of service from thedate of passing of the final order by the disciplinaryauthority till reinstatement for all other purposes, exceptfor payment of salary for the period he was out of service.

11. For the foregoing reasons, while confirming thefindings of the Tribunal to the extent of the validity of theorder dated 09.02.2009 passed by the disciplinaryauthority as well as the order of the appellate authoritydated 02.11.2010, we modify the impugned order of theTribunal by holding that the 1[st] respondent-applicant isnot entitled for salary for the period he was out of service.

12. In the result, the Writ Petition is allowed, in part, onlyto the extent of modifying the consequential relief grantedby the Tribunal with regard to payment of salary. In everyother respect, the order of the Tribunal stands confirmed. We make it clear that the period for which the 1[st]respondent-applicant was out of service shall be treatedas “on duty” for all other purposes, except for payment ofsalary.

13. As a sequel, miscellaneous petitions if any pendingin this Writ Petition stand disposed of. There shall be noorder as to costs.

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R. SUBHASH REDDY, J

31[st] December 2013MRR

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A.SHANKAR NARAYANA, J

[1](2007) 1 SCC 437