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2012 Supreme(Cal) 432
IN THE HIGH COURT OF CALCUTTA
JOYMALYA BAGCHI, J.
Bindeshwari Prasad Singh – Appellant
Vs.
The Eastern Coal Fields Ltd. & Ors. – Respondent
W. P. No. 19427 (W) of 2010
Decided On: 11.05.2012
Advocate Appeared:
For Appellant/Petitioner/Plaintiff: Mr. Partha Ghosh
For Respondents/Defendant: Mr. Alok Banerjee, Mr. Susanta Pal, Mr. Partha Basu and Mr. Nikhil Kumar Roy
Continuation of disciplinary proceedings against a superannuated employee is permissible only if the relevant service rules permit imposition of penal consequences after retirement, such as withholding or reducing pension.
Headnote:
Jaswant Singh Gill v. Bharat Coking Coal Ltd. & Ors.- Disciplinary Proceedings against Superannuated Employees - Pecuniary Loss Requirement - Service Rules Interpretation - Gratuity Withholding - Pension Scheme - Order of Censure - Futility of Proceedings - Court's Jurisdiction - Relief Moulding.
Fact of the Case:
Petitioner, a retired employee, challenged the disciplinary proceedings initiated against him post-retirement and sought release of gratuity, terminal benefits, and leave encashment. The respondent company defended the continuation of disciplinary proceedings, claiming it was permitted under service rules and could lead to a penalty that would affect retiral benefits.
Finding of the Court:
1. No pecuniary loss was suffered by the respondent company due to the alleged misconduct of the petitioner. 2. Continuation of disciplinary proceedings against a superannuated employee is permissible only if the relevant service rules permit imposition of penal consequences after retirement, such as withholding or reducing pension. 3. Rule 34.3 of the service rules, which allowed withholding of gratuity, was held to be ultra vires the Payment of Gratuity Act, 1972, by the Supreme Court in Jaswant Singh Gill v. Bharat Coking Coal Ltd. & Ors. 4. The penalties enumerated in Rule 27 of the service rules, including 'censure,' could not be imposed on the petitioner after his retirement as the master-servant relationship had ended. 5. The respondent company had no power to withhold the petitioner's pension under the relevant pension scheme. 6. Continuation of the disciplinary proceeding against the petitioner had become an empty formality and an act in futility since no order of penal consequence could be passed against him under the relevant service rules.
Issues: 1. Whether disciplinary proceedings can be continued against a superannuated employee in the absence of pecuniary loss to the employer. 2. Whether the service rules applicable to the petitioner permitted imposition of any penalty upon him after his retirement. 3. Whether the order of censure passed against the petitioner was valid and enforceable.
Ratio Decidendi: 1. Continuation of disciplinary proceedings against a superannuated employee is not permissible if the relevant service rules do not permit imposition of any penal consequence after retirement. 2. The service rules applicable to the petitioner did not provide for any penal/civil consequence of imposition of the penalty of 'censure' in the form of withholding or reduction of retiral benefits. 3. An order of censure passed against a superannuated employee, when the service rules do not provide for any penal/civil consequence of such penalty, is an empty formality and non-est in law.
Final Decision: 1. The impugned disciplinary proceeding and the impugned order of censure/awarded against the petitioner were quashed. 2. The respondent company was directed to calculate and release any leave encashment due and other retiral benefits to the petitioner within four weeks from the date of communication of the order.
Joymalya Bagchi, J.
1. The petitioner has taken out the instant writ petition, inter alia, praying for release of his gratuity, other terminal benefits, arrear wages and leave encashment which have been wrongfully withheld by the respondent company and also for quashing the disciplinary proceeding initiated vide memorandum of charges dated 27.01.2010 which is being continued even after his superannuation. The respondent company has opposed the instant writ petition by filing affidavit-in-opposition in the matter. The stance of the respondent company in the affidavit-in opposition is to the effect that the delinquent conduct of the petitioner amounted to grave misconduct which called for awarding of major penalty under the extant service rules and therefore, the respondent company was entitled to continue the disciplinary proceedings against the petitioner notwithstanding superannuation. At the interim stage, this Court by order dated 4.10.2010 directed the Assistant Commissioner to consider and dispose of the representation of the petitioner with regard to release of gratuity. Pursuant to such direction, it appears that the gratuity payable to the petitioner has been released by the respondent company. In course of the hearing. Mr. Banerjee, learned counsel appearing for the respondent company further informed this Court that the arrear of wages payable to the petitioner have also been released.
2. In view of the aforesaid facts, what remains to be decided at the final hearing of this writ petition is whether the disciplinary proceedings initiated against the petitioner ought to be continued even after his retirement.
3. Mr. Ghosh, learned counsel appearing for the writ submits that the continuation of the disciplinary proceeding post superannuation would be an empty formality in view of the law declared by the Supreme Court in the case of Jaswant Singh Gill v. Bharat Coking Coal Ltd. & Ors., reported in (2007) 1 SCC 663. In the said decision, the Apex Court held that Regulation 34.3 of the Coal India Executives' Conduct, Discipline and Appeal Rules, 1978 was ultra vires the provisions of the Payment of Gratuity Act, 1972 and would not permit the respondent company to withhold payment of gratuity resorting to the said rule in violation of the provisions of the said Act. In view of such ratio as laid down by the Supreme Court, he submits that the disciplinary proceeding for the purpose of withholding the payment of gratuity is not permissible in law. Mr. Ghosh further submits that a bare reading of memorandum of charges would show that no pecuniary loss had been suffered by the respondent company on account of the alleged delinquent act of the petitioner. Relying on the decisions rendered by this Court in the cases reported in (2009) 1 CLJ (Cal) 221 and (2010) 3 CHN 871, and the Apex Court in AIR 1999 SC 1841 and AIR 1970 S.C. 219, he submits that in the absence of pecuniary loss suffered by the respondent company, the latter docs not have jurisdiction to continue such disciplinary proceeding post superannuation. He, therefore, prays that the disciplinary proceeding be quashed and other dues like leave encashment be forthwith released by the respondent authorities to the petitioner.
4. Mr. Banerjee, learned counsel for the respondent company in rebuttal submits that no pecuniary loss is required to be caused in continuing with a disciplinary proceeding against a retired employee if the service rules so permit. He submits that Rule 34.2 of the service rules do not lay down such a condition precedent and the same cannot be read into it. He relies on a case reported in (2001) 3 CHN 740 wherein an Hon'ble Division Bench of this Court has held that Rule 10 of the West Bengal Services (Death-cum-Retirement Benefits) Rules, 1971 permit continuation of a proceeding against a superannuated employee irrespective of any pecuniary loss suffered by the government. He also relies upon a decision reported in (2007) 9 SCC 15 wherein a majo
