Disciplinary proceedings initiated during employment must have express grounds for withholding retiral benefits, as defined by the corporate rules. Without such grounds, benefits cannot be withheld post-retirement.

JUDGMENT

Amit Bansal, J. (Oral)--On 5th January, 2021, when this appeal first came up for consideration, the following order was passed:

3. The appeal impugns the judgment dated 17th November, 2020 of the Single Judge in W.P.(C) No.3114/2020 instituted by the respondent, seeking a mandamus directing the appellant to release the retiral benefits comprising of gratuity, leave encashment and provident fund (PF) to the respondent. During the pendency of the petition, the respondent's share of PF was released to the respondent, with the appellant's share of PF amount only being retained/withheld. Further, though the respondent, in the writ petition had sought release of gratuity also, but during the hearing before the Single Judge, gave up the relief of release of gratuity and agreed to the same being withheld by the appellant, till the culmination of the disciplinary proceedings initiated against the respondent. Thus, only the claim for release of leave encashment amount and the employer's share of PF amount remained for adjudication before the Single Judge and the Single Judge, vide the impugned judgment has directed the appellant to release both the said amounts to the respondent. Aggrieved therefrom, this appeal has been preferred.

4. We have heard the counsel for the appellant as well as the counsel for the respondent, appearing on advance notice, at length.

5. We will first deal with the impugned direction of the Single Judge, insofar as it concerns the release of the leave encashment amount. Leave encashment of the employees of the appellant is governed by the NATIONAL TEXTILE CORPORATION LIMITED LEAVE RULES , 2015 and Rule 7 whereof deals with Leave Encashment. Rule 7.7 inter alia permits the authority competent to grant encashment of leave, to withhold whole or part of cash equivalent of earned leave, in case of any employee who retires from service on attaining the age of superannuation, while under suspension or while disciplinary or criminal proceedings are pending against him, if in the view of such authority there is possibility of some money becoming recoverable from him on conclusion of the proceedings against him. The Single Judge, in the impugned judgment has held that since there was no finding returned or opinion expressed in the order withholding the amount of leave encashment, of a possibility of some money becoming recoverable from the respondent on conclusion of the disciplinary proceedings initiated against him, the amount due towards leave encashment could not be withheld. Reliance was placed on Satya Prakash Vs. Chairman Cum Managing Director, Bharat Sanchar Nigam Ltd., 2019 SCC OnLine Del 8039 and Govt. of NCT of Delhi Through Chief Secretary Vs. Prem Nath Manchanda, 2018 SCC OnLine 13066, laying down that for leave encashment amount to be withheld, there has to be an express opinion in the order withholding the leave encashment amount, of such possibility and which did not exist in the present case.

6. The counsel for the appellant has not impugned the aforesaid reasoning. He has however drawn our attention to the Conduct, Discipline and Appeal Rules, 2009 of the appellant, Rule 25.13 titled "Continuation of Enquiry Beyond Superannuation" whereof inter alia provides, that (i) disciplinary proceedings, if instituted while the employee was in service, whether before his retirement or during his re-employment, shall, after the final retirement of the employee, be deemed to be subsisting and shall be continued and concluded by the authority by which it was commenced, in the same manner as if the employee had continued in service; and, (ii) in such cases, the employee will cease to be in service from the date of superannuation