2006 Supreme(SC) 441

2006(4) Supreme 8
SUPREME COURT OF INDIA
(From Punjab and Haryana High Court)
S.B. Sinha & Dalveer Bhandari, JJ.
Inderpreet Singh Kahlon & Ors.—Appellants
versus
State of Punjab & Ors.—Respondents
Civil Appeal Nos. 3411-3421 of 2005
With
Civil Appeal Nos. 3422, 3410, 3409, 3405-3408, 3456-3459, 3446-3447, 3402, 3449-3455, 3463-3464, 3460, 3401, 3445, 3399, 3404, 3444, 3441, 3439, 3428-3436, 3440, 3438, 3442, 3437, 3403, 3427, 3461, 3400, 3477, 3475, 3423, 3448, 3472-3474, 3489,
3491 of 2005
And
W.P. (C) No. 14 of 2004
Decided on 3-5-2006
Counsel for the Parties :
For the Appearing Parties : Sarup Singh, Sr. Addl. Advocate General of Punjab, R.K. Rathore, AAG of Punjab, Dr. Rajeev Dhawan, A.K. Ganguli, Mahabir Singh, B.S. Malik, Rajiv Atma Ram, Rakesh Dwivedi, P.P. Rao, Sr. Advocates; Manoj Swarup, Ashish Mohan, Uday Gupta, Neeraj Sharma, Jitendra Mohan Sharma, Sandeep Singh, Ms. Madhusmita Bora, Nikhil Jain, D. Mahesh Babu, Naresh Kumar, Nidhesh Gupta, Ms. Nidhi Gupta, Vinod Shukla, Ms. S. Janani, Dinesh Verma, Ms. Suresh Kumari, A.P. Mohanty, J.P. Tripathi, S.C. Paul, G.S. Mann, Ms. Roopa Paul, Ms. Chanchal Goel, Mrs. Rekha Pandey, Sushil Kumar Jain, Ms. Pratibha Jain, Ram Niwas, A.P. Dhamija, H.D. Thanvi, Sarad Singhania, Pradeep Agarwal, Balkrishan Sharma, Gurminder Singh, Ms. Rani Maheshwari, Punit Bali, Prabhjit Jauhar, Ms. Anita Narwal, S.S. Jauhar, S.B. Upadhyay, Shiv Mangal Sharma, Sanjay Das, Ajay Bansal, Neeraj Kumar Jain, Aditya Kumar Chaudhary, Bharat Singh, Sanjay Singh, Ugra Shankar Prasad , Ashok K. Mahajan, Paramjit Batta, Vineet Bhagat, Debasis Misra, Rajshekhar Rao, Nikhil Nayyar, Vipin Gopia, Ms. Jaspreet Gogia, Gurinder P. Singh, K.K. Gogia, Mrs. Jayashree Anand, Karuna Karmahali, Rana Ranjit Singh, R.C. Kohli, P.N. Puri, Ms. Vimla Sinha, Abhushek Chaudhary, Gaurav Bhatia, Saad Shervani, Ms. Niranjana Singh, Gaurav Liberahan, Adarsh Upadhyay, Arun K. Sinha, Rakesh Singh, Mukesh Kumar Sinha, A. Mariarputham, Ms. Aruna Mathur, (for M/s. Aruputham Aruna & Co.), Jitender Kumar Bhatia, Bimal Roy Jad, M.P. Shorawala, Advocates.

IMPORTANT POINTS
1. En-masse orders of termination of services could not have been issued in case of illegality in the selection process when the tainted cases could be separated from the non-tainted cases. The Court while setting aside a selection may require the State to establish that the process was so tainted that the entire selection process is liable to be cancelled.
2. An action taken in undue haste may be held to be malafide.
3. The Superior Judiciary always makes endeavours to deal with the Judicial Officers in all seriousness it deserves but then harsh punishments may be meted out only when there are sufficient materials on record so as to enable it to satisfy itself upon adopting a fair procedure.
4. When the basis of termination is serious allegations of corruption, then it is imperative that the principles of natural justice must be fully complied with.
5. An appointment made in violation of Articles 14 and 16 of the Constitution of India would be void.
6. It is now well settled that a decision is an authority for what it decides and not what can logically be deduced therefrom. A ratio of case must be understood having regard to the fact situation obtaining therein.

Headnote:(i) SERVICE LAW—Constitution of India—Articles 315 & 320—Punjab Civil Services (Punishment and Appeal) Rules, 1970—Rule 23—Irregularities in selection process—Allegations against Chairman of Punjab Public Service Commission that he got a large number of persons appointed on extraneous consideration including monetary consideration—Such appointments were made to PCS (Executive Branch), Allied Services and PCS (Judicial Branch)—Raids were conducted in the house of the Chairman—About 16 crores rupees were recovered—Orders of termination of services of 64 persons were passed on 23-5-2002 while examinations were held for recruitment years of 1997-98, 1998-99, 1999-2000 and 2000-2001—No appointment was made from 2001 batch—Services of Direct Recruit Executive Class I and Class II were terminated by way of dismissal from services only on the premise that criminal prosecution had been initiated against the Chairman—Regarding Judicial Officer, High Court acted on basis of media reports alleging that wards of some setting Judges of High Court have been favoured by the Chairman—Committee appointed by the High Court recommended that appointments made of Judicial Officers in all the four batches should stand cancelled—That report was accepted by the Full Court—Judicial Officers were unfairly treated by the High Court—Whether respondents were justified in cancelling the entire selection both of Executive and Judicial Officers—(No)—Order made to constitute two independent scrutiny committees, one relating to the Executive Officers and the other relating to the Judicial Officers—Status quo shall be maintained until disposal of matter by the High Court.

       As per S.B. Sinha, J.

       Held : The services of the appellants before us were terminated not in terms of the Rules but in view of the commission of illegality in the selection process involved, we need not consider the applicability of the relevant provisions of the statutes as also the effect of the provisions of Article 311 of the Constitution of India. An appointment made in violation of Articles 14 and 16 of the Constitution of India would be void. It would be a nullity.(Para 36)

       If the services of the appointees who had put in few years of service were terminated; compliance of three principles at the hands of the State was imperative, viz., to establish (1) Satisfaction in regard to the sufficiency of the materials collected so as to enable the State to arrive at its satisfaction that the selection process was tainted; (2) determine the question that the illegalities committed go to the root of the matter which vitiate the entire selection process. Such satisfaction as also the sufficiency of materials were required to be gathered by reason of a thorough investigation in a fair and transparent manner; (3) Whether the sufficient material present enabled the State to arrive at satisfaction that the officers in majority have been found to be part of the fraudulent purpose or the system itself was corrupt. Once such findings were arrived at, all appointments traceable to the officers concerned could be cancelled. But admittedly, although there had been serious imputations against Shri Sidhu being at the helm of the affairs of the Commission, all decisions made by the Commission during his tenure are yet to be set aside. We do not intend to enter into the said controversy as we were informed at the bar that the High Court itself is in sesin of the matter. We may, however, note that Mr. Dwivedi in his usual frankness stated that there may not be any answer to that query.(Paras 37 & 38)

       It is also not a case where all the relevant records have been destroyed. The Vigilance Bureau does not say so. Questions papers, answer sheets and other documents are available. Reports made by the Bureau were prepared upon examination of the materials collected by it. The High Court itself has noticed that what is not available is the records relating to the procedure adopted in regard to the appointment of paper setters. It may be true that such records could be destroyed only after a period of five years but it has not been pointed out by the State as to how by reason of the non-availability thereof, it became difficult for the authorities to arrive at the correct facts. We have not been informed that connecting materials were also destroyed. It has been noticed by the High Court that all relevant information were available and submitted to the court. It cannot, therefore, be said that a fair investigation into the whole affair was an impossible task or despite availability of all such records a thorough investigation had been made so as to arrive at a satisfaction that the entire selection process suffered from a large scale fraud. It was also not been found that all appointments were made on extraneous considerations including monetary consideration.(Para 40)

       If fraud in the selection process was established, the State should not have offered to hold a re-selection. Seniority of those who were re-selected ordinarily could not have been restored in their favour. Such an offer was evidently made as the State was not sure about the involvement of a large number of employees. A distinction moreover exists between a proven case of mass cheating for a board examination and an unproven imputed charge of corruption where the appointment of a civil servant is involved.(Paras 41 and 42)

       Both the State Government as also the High Court in that view of the matter should have made all endeavours to segregate the tainted from the non-tainted candidates.(Para 47)

       The High Court, therefore, cannot be said to be right in applying the principle of mass cheating cases in the instant case.(Para 53)

       In a case of this nature, thus, the question which requires serious consideration is as to whether due to misdeed of some candidates, honest and meritorious candidates should also suffer.(Para 55)

       Another factor which merits consideration is as to whether even if the statements of approver and other witnesses are taken to be correct, the selection made in the year 1998 could be said to be so tainted so as to vitiate the entire selection process. Jagaman Singh merely stated that only in 1999 Shri Sidhu upon taking him into confidence disclosed that he had some surplus amount with him. It is stated before us that he has not implicated any candidate for the year 1998-99 by name. Some of the statements made by him are said to be with regard to the recovery part and not in regard to the validity or otherwise of the examination and other selection processes. It was, therefore, necessary to establish that the examinations held in 1998 were also tainted. Some evidence in that behalf should have been brought on record to establish the necessary tint. It is not in dispute that in respect of the services where selections were made on the basis of the interview, the same was conducted by the Chairman and two other members. On each subject one expert was also appointed. We place on record that so far as the Judicial Officers are concerned the expert was a sitting High Court Judge and, thus, it is not expected that any irregularity far less illegality would be committed in the matter of allotment of marks at the interview. In any event, it was necessary to arrive at such a finding.(Paras 60 & 61)

       Furthermore, a decision in undue haste was taken. So far as the nominated officers are concerned, whereas a note containing 90 pages was sent to the Chief Secretary of Punjab on 22.5.2002, the services of all the officers were terminated on the next day. Apart from the materials which have been relied on in the report, no further evidence was probably brought in between 23.5.2002 and 24.8.2002 when the services of the Executive Officers were terminated. It is, thus, furthermore, beyond anybody’s comprehension as to why action had to be taken in undue haste. We do not intend to suggest that in any emergency it was not permissible but we have not been shown that any such emergent situation existed. It was in any event necessary for the State to show as to how the records moved so as to satisfy the conscience of the court that there had been proper and due application of mind on the part of the concerned authorities. An action taken in undue haste may be held to be mala fide.(Paras 66 to 68)

       We may now deal with the orders of termination of the services of the Judicial Officers.(Para 69)

       The material supplied to the Committee, having regard to the fact that most of the officer named in the First Information Report were of 2001 batch, cannot be held to be sufficient so as to come to the conclusion that the entire selection process for 1999 and 2000 was vitiated. Despite the fact that the selection process for the year 1998 was not the subject matter of the enquiry, recommendations had been made by the Committee for cancellation of appointment of the candidates of 1998 batch also. The Full Court without any basis whatsover recommended dismissal of all the Judicial Officers. Only when the Additional Secretary of the Government of Punjab vide a letter dated 27.9.2002 which was received by the High Court on 28.9.2002, drew its attention in that behalf, another committee was constituted by the then Acting Chief Justice on 10.10.2002 evidently, after the said matter was discussed in the Full Court. Two of the five member Committee were also the members of the first Committee. The second Committee again considered the statements of the approver and one other witness recorded under Section 164 of the Code of Criminal Procedure as also other documents placed before it and came to the opinion : (1) Performance of most of the selected candidates was below average and the marks awarded to them were disproportionate to the answer given by them. (The aforementioned opinion, was made on the basis of some of the answer sheets of some of the selected candidates and those who had not been selected.) (2) The marks originally given to the candidates were scored off and unjustifiably increased obviously with a view to ensure their selection. (3) Another feature which was noticed that the answer sheets of some of the non-selected candidates were qualitatively better than some of those who had been selected but they had been awarded lesser marks, presumably, with a view to push them down.(Para 74)

       Corruption in the selection process and in any event illegality going to the root of the matter, of course, would not be tolerated. But then even applying the strict standard in the case of the judicial officers, whereas applying liberal standard in the case of others, at least certain basic norms were required to be followed. For the said purpose, minimal requirements of the principles of natural justice must be complied with. We regret to note that judicial officers had not been fairly treated by the High Court. They deserved better treatment. An authority holding an enquiry of such a nature would ordinarily carry out exercises to find out as to whether the selection process was vitiated by fraud or such illegalities which would vitiate the entire selection process. The Committee was dealing with charges of aiding and abetting corruption on the part of the judicial officers may only some of them and, thus, it was necessary for it to apply its mind more seriously. The members of the Committee were not reevaluating the answer scripts. The candidates were not before them. Their abilities were not being tested. The learned members of the Committee should have asked unto themselves the right question, mainly because the issue before them was different and distinct from an ordinary departmental enquiry. In any event, there was absolutely no reason why copies of the said reports could not have been supplied to the appellants.(Para 75)

       We fail to understand as to why two senior Judges who had headed the Committee should have been made part of the Bench. It was not a case where the doctrine of necessity was required to be invoked. It may be that the counsel appearing on behalf of the Judicial Officers did not object to the learned Judges who were members of the Committee to hear the matter.(Para 77)

       The writ petitioners, thus, might have waived their right to raise a contention as regard bias on the part of the Hon’ble Judges but the same would not mean that this Court would ignore such a vital fact. It was clearly a case where the Hon’ble Judges should have recused themselves from hearing the matter. It was for them to remind themselves that justice is not only done but manifestly seen to be done. (Para 82)

       The High Court was probably enthralled by the media reports that two of the words of its sitting Judges obtained appointment wrongly. It is, however, stated at the Bar that they were toppers of the Batch and in the First Information Reports, their names had not been mentioned. Only because wards of its sitting Judges obtained employment, the same by itself would not give rise to a presumption that everything was not well in the selection making process. We, having regard to the peculiar facts and circumstances of the case, are of the opinion that it is necessary to direct consideration of the matters afresh. We have not been apprised whether in the criminal cases any further material had been gathered so as to implicate the appellants before us.(Paras 85 & 86)

       We must, however, express our satisfaction that no candidate for the year 2001 has been appointed. It is one thing to say that having regard to the nature of selection process, no person is appointed from the select list as no person has right to be appointed only because his name appears in the select list, but, in our opinion, a different standard must be adopted for terminating the services of the officers who had completed about three years of service. Some of them, as noticed hereinbefore, passed departmental tests. Some have been given higher responsibilities. They had completed the period of probation and some were nearing the completion thereof. They presumably had been working to the satisfaction of the authorities concerned. The impugned judgment as also the orders of the State Government and the High Court are, thus, liable to be set aside and directions are issued. Although the impugned judgments cannot be sustained, we are of the opinion that the interest of justice would be subserved if the matters are remitted to the High Court for consideration of the matters afresh. However, with a view to segregate between the tainted with non-tainted and that in the interest of justice the High Court should be requested to constitute two independent scrutiny committees – one relating to the executive officers and the other relating to the judicial officers.(Paras 88 & 89)

       We would, furthermore, request the High Court to consider the desirability of delineating the area which would fall for consideration by such Committee within a time frame. Copies of such reports of the Committees shall be supplied to the learned counsel for the petitioners and/or at least they should be given inspection thereof. The parties shall be given opportunity to inspect any document including the answer sheets etc. if an application, in that behalf is filed. (Para 90)

       As per Dalveer Bhandari, J. (Partly concurrent)

       Held : I had the benefit of reading the erudite judgment of my learned brother Justice Sinha. I concur with the conclusions and findings arrived at by him on all the issues except on the issue of propriety of hearing of the matter by the judges (who were on the Committee), after the appellants gave clear consent to the hearing of cases by the full bench even before the commencement of the hearing of cases. I would therefore, like to write a separate judgment.(Para 92)

       The principal question which needs to be adjudicated is whether, in the facts and circumstances of these cases, the respondents were justified in cancelling the entire selection both of executive and judicial officer?(Para 115)

       Undoubtedly, in the selection process, there have been manipulations and irregularities at the behest of R.S. Sidhu, the then Chairman, Punjab Public Service Commission. On careful scrutiny of the facts and circumstances of the case, in my considered opinion, the High Court ought to have made a serious endeavour to segregate the tainted from the non-tainted candidates. Though the task was certainly difficult, but by no stretch of imagination, it was not an impossible task.(Para 116)

       The peculiar facts of this case which need to be highlighted are that some of the candidates have worked for about three years and their services were terminated only on the basis of criminal investigation which was at the initial stage. The termination of their services as a consequence of cancellation of selection would not only prejudice their interests seriously, but would ruin their entire future career.(Para 117)

       It may be pertinent to mention that during the said period there has been no allegation regarding the integrity or efficiency of these officers.(Para 118)

       The facts of this case reveal that the material supplied to the Committee having regard to the facts that majority of the officers named in the FIR belonged to 2001 batch, the respondents not only cancelled the entire selection of 2001 batch, but on the basis of the cancellation of selections of 2001 batch the entire process of 1999 and 2002 selections was also cancelled. It is also relevant to mention that the selection process for the year 1998 was not the subject matter nor any recommendation had been made by the Committee, even then the selections of this year were also vitiated. The High Court Committee without there being sufficient and adequate material on record recommended cancellation of selections of both the executive and judicial officers and the Full Bench erred in accepting the recommendation and terminating the services of all the officers.(Para 119)

       A close scrutiny of the facts of this case clearly reveals that the judicial officers did not get a fair treatment by the High Court. They were not given copies of the Report and other material on which reliance was placed and they virtually had no chance of making effective representation before the Committee or any other forum where they could ventilate their grievances and present their point of view.(Para 120)

       When the basis of termination is serious allegations of corruption, then it is imperative that the principles of natural justice must be fully complied with.(Para 121)

       The High Court has not considered the case in the proper perspective. The consequences of en masse cancellation would carry a big stigma particularly on cancellation of the selections which took place because of serious charges of corruption. The question arises whether for the misdeeds of some candidates, honest and good candidates should also suffer on en masse cancellation leading to termination of their services? Should those honest candidates be compelled to suffer without there being any fault on their part just because the respondents find it difficult to segregate the cases of tainted candidates from the other candidates? The task may be difficult for the respondents, but in my considered view, in the interest of all concerned and particularly in the interest of honest candidates, the State must undertake this task. The unscrupulous candidates should not be allowed to damage the entire system in such a manner where innocent people also suffer great ignominy and stigma.(Para 122)

       On consideration of the cumulative facts and circumstances I entirely endorse the directions given by my learned brother Justice Sinha. Consequently, the learned Chief Justice of Punjab and Haryana High Court is requested to set up two independent committees, one, with regard to the executive officers and another with regard to the judicial officers. They should delineate the area which falls for consideration by the said Committees and the Committees be requested to reconsider all the cases and submit a Report to the Punjab and Haryana High Court as expeditiously as possible. In consonance with the principles of natural justice the respondents are directed to supply the copies of the report and other material on which reliance has been placed within two weeks. The appellants would also be permitted to inspect the entire record and obtain copies of the documents in accordance with the rules. The Court would also provide the appellants two weeks time to submit their objections to such report and comment, if any, on the material provided by the Court. Since the appellants are out of job, the High Court is requested to dispose of the matter as expeditiously as possible preferably within three months from the date of receipt of the copy of this order. Status quo as of today shall be maintained until the disposal of the matter by the High Court.(Paras 145 & 146)

       (ii) SERVICE LAW—Waiver—Termination of services of Judicial Officers—Illegality in selection process—Propriety of hearing of matter by judges who were on the Committee—Appellant gave clear consent to the hearing of cases by the Full Bench—Whether doctrine of waiver can be held applicable—(No, as per S.B. Sinha, J.)—It was held that Judges should have recused themselves from hearing the matter—(Yes, as per Dalveer Bhandari, J.)—It was held that appellants having waived their right, were not justified in making any grievance regarding hearing of cases by those two Judges who were members of the Committee also.

       As per S.B. Sinha, J.

       Held : We fail to understand as to why two senior Judges who had headed the Committee should have been made part of the Bench. It was not a case where the doctrine of necessity was required to be invoked. It may be that the counsel appearing on behalf of the Judicial Officers did not object to the learned Judges who were members of the Committee to hear the matter.(Para 77)

       The writ petitioners, thus, might have waived their right to raise a contention as regard bias on the part of the Hon’ble Judges but the same would not mean that this Court would ignore such a vital fact. It was clearly a case where the Hon’ble Judges should have recused themselves from hearing the matter. It was for them to remind themselves that justice is not only done but manifestly seen to be done. (Para 82)

       As per Dalveer Bhandari, J. (Dissenting)

       The two judges, who were part of the full bench, did not have bias of any kind against the appellants. They had no pecuniary or any other interest in the matter. They have discharged their judicial functions as judges. Therefore, I find no merit in the submission that the two judges, who were part of the Committee, ought not to have heard this matter. In the facts and circumstances of the case, in my considered opinion, the appellants are not justified in making any grievance before this Court regarding the hearing of the cases by the full bench of which two judges who had submitted the Report, were also members. Admittedly, those judges constituting the full Bench had no interest of any kind in deciding the matter one way or the other. The appellants before the commencement of hearing categorically submitted that they had no objection whatsoever to the hearing of the matter by the said full bench. Even assuming, those judges had any bias against the appellants, the appellants had waived their right, if any. In these circumstances, the doctrine of ‘waiver’ is fully applicable.(Paras 132 & 133)

       In the instant case, assuming the appellants had any right, that right was clearly relinquished and given up by them, when they gave no objection to the hearing of the case by the two judges who were part of the full bench. Now, after the case was heard and the judgment has gone against them, it is hardly fair, proper and appropriate for them to raise this as a ground before this Court. Another significant aspect of this matter is that the two judges (who were part of the Committee) were not impleaded as parties in the writ petitions before the High Court and they have not been impleaded as parties in these appeals before this Court. In case, the appellants were so keen to level allegations against those two judges, the appellants ought to have impleaded them as parties at least before this Court (with the permission of this Court). This is the minimum requirement of the principles of natural justice.(Paras 141 & 142)