1. Challenge to an order of compulsory retirement under Rule 48(b) of C.C.S. Pension Rules, 1972, on grounds of arbitrariness and mala fides. (Para 1 , 2 )
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1997 Supreme(SC) 942
SUPREME COURT OF INDIA
I. K. MISHRA
Versus
Union of India
Decided on, July 11, 1997
Important Points
Compulsory retirement is not a punishment but a subjective decision made in public interest. It is valid unless proven mala fide, arbitrary, or based on no evidence. Adverse remarks in service records retain their significance unless the employee is subsequently promoted to a higher post based on merit.
Subject
Employment Law - Compulsory Retirement
Act Referred
CENTRAL CIVIL SERVICES PENSION RULES: R.48(1)(b)
Headnote
C. C. S. Pension Rules, 1972 – Rule 48 – Appellant challenged the impugned notice compulsorily retiring him from service by filing a Civil Suit in Court Gwalior for a declaration that order compulsorily retiring him from service is illegal and inoperative, being arbitrary and mala fide – Trial Court decreed suit and aforesaid decree was affirmed by First Lower Appellate Court – High Court in Second Appeal filed at the instance of respondents set aside decree and judgments of trial Court and First Appellate Court holding that order compulsorily retiring appellant from service did not suffer from infirmity either on account of arbitrariness or mala fides how plaintiff appellant has come up in appeal before us – Held, Departmental Promotion Committee present case after appellant was declared successful in examination Departmental Promotion Committee after considering the service record of appellant did not recommend his case for further promotion principle noted in case of Baikuntha Nath appellant having not been promoted to higher post adverse remarks in his character roll remained intact appellant was not promoted to higher post by Departmental Promotion Committee it is not correct to contend that adverse materials in annual confidential report of appellant lost their sting and those materials could not form the basis of order compulsorily retiring appellant from service – Order compulsorily retiring appellant was a mala fide order as same was passed at the instance of Shri Manazure Muastafa Siddiqui, Accountant General, M. P. , who bore grudge against appellant argument is being noted only to be rejected be noticed that the record before us does not show that Shri Manazure Muastafa Siddiqui was party to suit not impleaded by name in suit – Appeal Dismissed.
Legal Category Hierarchy
Table of Contents
2. Whether the compulsory retirement order was arbitrary and mala fide given the claim of an unblemished service record and successful completion of a professional examination. (Para 3 , 7 , 8 )
3. The service record contained adverse entries and penalties; passing a professional examination without subsequent promotion does not erase the impact of adverse confidential reports. (Para 4 , 5 , 6 , 7 , 8 )
4. Compulsory retirement is not punishment but based on subjective satisfaction in public interest, reviewable only if mala fide, based on no evidence, or perverse. (Para 3 )
5. Appeal dismissed. (Para 9 )
6. Is an order of compulsory retirement considered a punishment?
No, an order of compulsory retirement is not a punishment and implies no stigma or suggestion of misbehaviour. It is passed based on the subjective satisfaction of the Government that it is in the public interest. (Para 3 )
7. Under what circumstances can a court interfere with an order of compulsory retirement?
Courts may interfere if the order is passed mala fide, is based on no evidence, or is arbitrary to the extent that no reasonable person would form the requisite opinion on the given material. (Para 3 )
8. Does passing a professional examination erase the effect of adverse remarks in a service record?
Passing an examination only entitles an employee to be considered for promotion. If the Departmental Promotion Committee does not recommend promotion, the adverse remarks in the character roll remain intact and can be used for compulsory retirement. (Para 7 )
9. What must the government consider when deciding on compulsory retirement?
The government or Review Committee must consider the entire service record, including both favourable and adverse entries in confidential records and character rolls, typically attaching more importance to performance in later years. (Para 3 )
Judgment-
V. N. KAHRE, J.
( 1 ) THE appellant before us, started his service career as a Sub-Auditor in the erstwhile Holkar Estate, Indore with effect from 5/02/1943. Subsequently on reorganisation of States in the year 1956 the appellant continued to serve in the office of Accountant General, Madhya Pradesh, Gwalior. The appellant while working as Auditor was accorded selection grade. However, subsequently the appellant was compulsorily retired from service by notice dated 23rd of August, 1974 issued under Rule 48 (b) of C. C. S. Pension Rules, 1972 hereinafter referred to as the Rules.
( 2 ) THE appellant challenged the impugned notice compulsorily retiring him from service by filing a Civil Suit in the Court of Sub-Judge, Gwalior for a declaration that the order compulsorily retiring him from service is illegal and inoperative, being arbitrary and mala fide. The trial Court decreed the suit and the aforesaid decree was affirmed by the First Lower Appellate Court. The High Court in the Second Appeal filed at the instance of the respondents set aside the decree and judgments of the trial Court and the First Appellate Court holding that the order compulsorily retiring the appellant from service did not suffer from infirmity either on account of arbitrariness or mala fides. That is how the plaintiff appellant has come up in appeal before us.
( 3 ) COUNSEL for the appellant reiterated the argument advanced before the Court below characterising the order compulsorily retiring the appellant from service as arbitrary and mala fide. It was urged that the service record of the appellant being unblemished, the impugned order compulsorily retiring the appellant deserves to be held as arbitrary. The law in regard to the compulsory retirement of the Government servants in terms of service rule is almost settled by now by number of decisions of this Court. Repeatedly it has been held that the power to retire compulsorily a Government servant in terms of the service rules is absolute provided the concerned authority forms an opinion bona fide that it is necessary to pass order of compulsory retirement in the public interest. This Court in the case of Baikuntha Nath Das v. Chief District Medical Officer, Baripada, (1992) 2 SCC 299 : (1992 AIR SCW 793) after considering the number of decisions of the Apex Court referred the following principles for testing the validity of order of compulsory retirement.
"34. The following principles emerge from the above discussion :
(I) An order of compulsory retirement is not a punishment. It implies no stigma nor any suggestion of misbehaviour.
(II) The order has to be passed by the Government on forming the opinion that it is in the public interest to retire a Government servant compulsorily. The order is passed on the subjective satisfaction of the Government.
(III) Principles of natural justice have no place in the context of an order of compulsory retirement. This does not mean that judicial scrutiny is excluded altogether. While the High Court or this Court would not examine the matter as an appellate Court, they may interfere if they are satisfied that the order is passed (a) mala fide, or (b) that it is based on no evidence, or (c) that it is arbitrary - in the sense that no reasonable person would form the requisite opinion on the given material; in short, if it is found to be a perverse order.
(IV) The Government (or the Review Committee, as the case may be) shall have to consider the entire record of service before taking a decision in the matter - of course attaching more importance to record of and performance during the later years. The record to be so considered would naturally include the entries in the confidential records/character rolls, both favourable and adverse. If a Government servant is promoted to a higher post notwithstanding the adverse remarks, such remarks lose their sting, more so, if the promotion is based upon merit (selection) and not upon seniority.
(V) An order of compuls
