Grant of back wages upon reinstatement after quashing a compulsory retirement order is not an automatic right but a discretionary relief depending on the employee's conduct and the specific facts of the case.

Order on Board

Per Ramesh Sinha, C.J.

1. This writ appeal under Section 2(1) of the Chhattisgarh High Court (Appeal to Division Bench) Act, 2006 has been preferred by the appellant assailing the judgment and order dated 28.02.2026 passed by the learned Single Judge in WPS No. 9001 of 2023, whereby the learned Single Judge, while allowing the writ petition and quashing the order of compulsory retirement dated 01.05.2023 as well as the rejection of representation dated 06.07.2023, directed reinstatement of the appellant in service, however, declined to grant back wages for the intervening period. The present appeal is thus confined to the limited question as to whether the appellant is entitled to full back wages and consequential monetary benefits for the period between the date of compulsory retirement and reinstatement, in the facts and circumstances of the case.

2. The facts of the case in brief are that the appellant was appointed as Manager (Trainee) in the year 2005 in the Food Corporation of India and was subsequently confirmed as Manager (Depot) in 2006. During his tenure, he served at various places and was ultimately posted as Divisional Manager at Bareilly (Uttar Pradesh). Certain anonymous complaints alleging irregularities in procurement were made against him, which were investigated by a Committee headed by the Chief General Manager, Noida, and the allegations were found to be either incorrect or non-verifiable. A subsequent reinvestigation conducted by senior officers also concluded that the complaints were frivolous. Despite such exoneration, disciplinary proceedings were initiated against the appellant and a charge-sheet dated 15.06.2021 was issued. The Enquiry Officer, however, exonerated the appellant of all charges. Notwithstanding such findings, a penalty was imposed by the Disciplinary Authority.

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Thereafter, the appellant was compulsorily retired from service under Regulation 22(2) of the FCI (Staff) Regulations, 1971 vide order dated 01.05.2023. The appellant challenged the said order along with rejection of his representation before the learned Single Judge. The learned Single Judge, after considering the material on record, held that the appellant had not attained the age of 50 years at the time of issuance of the order of compulsory retirement and that the action of the respondents was unsustainable in law. Accordingly, the order of compulsory retirement was quashed and reinstatement was directed, but without back wages, which has led to filing of the present appeal.

3. Learned counsel for the appellant submits that once the order of compulsory retirement has been held to be illegal and has been quashed by the learned Single Judge, the natural and logical consequence ought to have been grant of full back wages along with all consequential benefits. It is contended that the denial of back wages, despite categorical findings regarding illegality, arbitrariness and absence of requisite jurisdictional facts, is contrary to settled principles of law. It is further submitted that in view of the proviso to Clause 22(2)(A)(ii) of the FCI (Staff) Regulations, 1971, once the order of premature retirement is set aside by a Court of law, the intervening period is required to be treated as spent on duty for all purposes including pay and allowances.

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It is also argued that the appellant was fully exonerated in departmental proceedings as well as in the CBI investigation and his service record throughout remained unblemished with consistent “Very Good” and “Outstanding” gradings. In such circumstances, the denial of back wages amounts to penalizing the appellant for no fault of his. Reliance has