Awadhesh Kumar Shukla v. U. P. Financial Corporation
1985-03-29
B.N.SAPRU
body1985
DigiLaw.ai
JUDGMENT B.N. Sapru, J. - This writ petition filed by Awadhesh Kumar Shukla arises out of a judgment of the U.P. Public Service Tribunal No. 1 Lucknow, in claim Petition No. 881 T of 1976 whereby the Services Tribunal dismissed the petitioner's reference by its judgment. 2. The petitioner was a Junior Assistant in the U.P. Financial Corporation. On 28-8-1970 the immediate superior of the petitioner issued a memo to the petitioner calling upon him to explain the circumstances in which a sum of Rs. 500/- paid by M/s. Dada Industries, Kanpur, paid to the petitioner for being deposited to the credit of the Corporation, had not been deposited. 3. Thereafter the petitioner received a notice dated 31-8-1970 from the Managing Director of the Corporation containing the same charge and he was asked to show cause within a week why the petitioner should not be dismissed from the service of the Corporation. 4. The petitioner submitted his explanation through a letter dated 15-9-1970. He denied the charges. On 17-9-1970 the Managing Director suspended the petitioner and by another of the same date, the Managing Director appointed Sri A.M. Kar, Chief Accountant of the Corporation, who was the immediate superior of the petitioner, as an enquiry officer. A charge-sheet was drawn-up by Sri A.M. Kar and served on the petitioner. The charge-sheet is dated 26-9-1970. 5. Thereafter the Managing Director submitted a note dated 21-10-1970 to the Board of Directors. This note was taken up at 164th meeting of the Board of Directors. On 26-10-1970 the Board of Directors passed the following resolution:-- "The Board considered the note of the Managing Director, dated the 21st October, 1970, on this item and confirmed the action taken by the Managing Director in suspending Sri A.K. Shukla, Junior Assistant in the Accounts Section of the Corporation with effect from the 17th September, 1970, and allowing him subsistence allowance at the rate of ?rd of his pay and appointing Sri A.M. Kar as the Enquiry Officer in the case. 6. The Enquiry Officer then proceeded with the enquiry despite certain objections by the petitioner and ultimately by order dated 23-6-1971 passed by the Managing Director, Sri N.S. Mathur, the petitioner was dismissed with effect from the date the order was approved by the Board of Directors. The Board of Directors subsequently approved the dismissal of the petitioner. 7.
6. The Enquiry Officer then proceeded with the enquiry despite certain objections by the petitioner and ultimately by order dated 23-6-1971 passed by the Managing Director, Sri N.S. Mathur, the petitioner was dismissed with effect from the date the order was approved by the Board of Directors. The Board of Directors subsequently approved the dismissal of the petitioner. 7. Against the dismissal order the petitioner preferred an appeal to the Board of Directors and the Board by its resolution dated 8-10-1971 dismissed the appeal. The order of dismissal was communicated to the petitioner by the Managing Director by letter dated 8/10-11-1971. 8. Thereupon the petitioner filed a suit in the Court of Munsif (City), Kanpur which he withdrew with the permission to file another suit. Thereafter the petitioner filed another suit in the Court of the Civil Judge, Kanpur, being Suit No. 68/70 of 1974 challenging the order passed against him and for a decree of money and also for certain other reliefs. During the pendency of the suit, the U.P. Public Services Tribunal Act, 1976, was enforced and the suit was transferred to the Services Tribunal with the result mentioned above. 9. The Tribunal found that there was no defect in the action of the Managing Director in appointing Sri A.M. Kar, the Chief Accountant as an Enquiry Officer and it further found that the Board of Directors had ratified the action of the Managing Director in appointing Sri Kar as the Enquiry Officer in its meeting held on 26-10-1970. It further found that Sri A.M. Kar was not the immediate superior of the petitioner but the immediate superior of the petitioner was the Superintendent. The Tribunal went on to hold that the initial action of the Managing Director in serving the notice dated 31-8-1970 on the petitioner did not affect the validity of the disciplinary proceedings as a regular enquiry was initiated by the Managing Director on 17-9-1970. It found that the petitioner was given opportunity to defend himself and that there was no violation of the principles of natural justice in the conduct of the enquiry. It further found that no prejudice was caused to the petitioner. With these findings, the Tribunal dismissed the claim petition. 10. Aggrieved, the petitioner has filed the instant writ petition. 11.
It found that the petitioner was given opportunity to defend himself and that there was no violation of the principles of natural justice in the conduct of the enquiry. It further found that no prejudice was caused to the petitioner. With these findings, the Tribunal dismissed the claim petition. 10. Aggrieved, the petitioner has filed the instant writ petition. 11. Under Section 48 of the State Financial Corporation Act, 1951, the Board has been conferred the powers to frame Regulations with the previous sanction of the State Government. Under that power, the Board has framed the U.P. Financial Corporation (Staff) Regulations, 1961. Regulation 40 deals with the penalties which may be imposed on an employee and also deals with the procedure to be followed in imposing the punishment. Regulation 40(3) which is relevant, runs as follows:-- "40(3) An employee may be placed under suspension by the Managing Director provided that the Managing Director shall report all the facts of the case known to him to the Board at its first meeting after he issued the orders of suspension and thereupon the Board shall appoint one of its members other than the Managing Director to hold an enquiry into the charges against such employee and to make a report to the Board. In the case of an employee other than in Class 'A' the Board may authorise any officer of the Corporation to hold an enquiry and submit his report to the Board through the Managing Director. During such suspension, the employee shall with the approval of the Board, receive subsistence allowance ranging between the minimum of th of pay and the maximum of leave salary on half average pay or half average substantive pay of the employee, provided that if the suspension is held by the Board to be wholly unjustified or the employee is fully exonerated, the period of suspension shall be treated as on duty and the employee shall be entitled to the difference between his subsistence allowance and emoluments which he would have received but for such suspension, for the period he was under suspension.
In any other case, the employee shall be entitled only to such proportion of pay and allowances as the Board may decide on the recommendations of the enquiry officer after deducting the amount of subsistence allowance drawn during the period of suspension, provided that in such case where only a portion of pay and allowance may be allowed the intervening period may be treated as one of duty for the purposes specified by the Board, if it so directs, so that it may count for leave increments, etc. 12. It has been submitted by the learned counsel for the petitioner that the suspension of the petitioner was invalid because the Managing Director did not report all the facts of the case known to him even after the suspension order at its first meeting. This was done at a later meeting. 13. The learned counsel for the respondent has argued that the fact that the suspension order was not placed at the first meeting after the suspension order, does not vitiate the suspension order. He has referred to in this connection to Interpretation of Statutes by Maxwell, 12th Edition, page 318, the Relevant quotation runs as follows: "The Riot Act, 1411, which required justices to try rioters "within a month" after the riot, was held not to limit the authority of justices to that space of time, but only to render them liable to a penalty for neglect. 14. This quotation would show that the expiry of a month did not limit the authority of Justices to that point of time but the trial took place even after the expiry of time. 15. It is well settled that where there is no penalty prescribed for not doing a thing within the time prescribed, the provisions are directory and not mandatory. In this case it is nowhere provided under Regulation 40(3) that the suspension order would become void on the expiry of time if the Managing Director does not place full facts at the first meeting of the Board of Directors after the suspension order was made. The argument of the learned counsel for the petitioner regarding the validity of suspension has, therefore, to be rejected. 16. On the basis of Regulation 40(3) it is argued that it was only the Board which was competent to appoint an Enquiry Officer to hold an enquiry and submit a report to the Managing Director.
The argument of the learned counsel for the petitioner regarding the validity of suspension has, therefore, to be rejected. 16. On the basis of Regulation 40(3) it is argued that it was only the Board which was competent to appoint an Enquiry Officer to hold an enquiry and submit a report to the Managing Director. It is submitted that the Managing Director had no such authority. It is urged that there was no valid appointment of an Enquiry Officer and any action taken on his report is vitiated. 17. In this connection it is further submitted that the language of Regulation 40(3) is very clear that it is the Board itself which must appoint an Enquiry Officer, no such power is conferred out the Managing Director. 18. Sri S.N. Upadhya appearing for the U.P. Financial Corporation has, in reply, urged that under Section 43-A it was open to the Board to delegate its powers and duties, by general or special order, as may be specified in the order to the Managing Director or to any officer of the Financial Corporation subject to such conditions and limitations. 19. He urged that there was a special delegation of the power to appoint an Enquiry Officer on the Managing Director by the Board when it had passed its resolution dated 26-10-1970. 20. Before the Services Tribunal the Financial Corporation did not urge that there was any delegation of power by the Board when it passed the resolution dated 26-10-1970, on the contrary, it was urged that the action of the Board amounted to ratification of the action of the Managing Director in appointing an Enquiry Officer. 21. The language of the resolution of the Board dated 26-10-1970 does not indicate any delegation of powers. It says-- "The Board considered the note of the Managing D rector dated the 21st October, 1970, on this item and confirmed the action taken by the Managing Director in suspending Sri A.K. Shukla. 22. It further confirmed the action of the Managing Director in appointing an Enquiry Officer 23. The stand of Sri S.N. Upadhya that the resolution of the Board amounted to a special delegation of power, is not borne out by the language of the resolution dated 26-10-1970. Where the Regulations provide that the Enquiry Officer shall be appointed by the Board, it is the Board which alone is competent to appoint the Enquiry Officer.
The stand of Sri S.N. Upadhya that the resolution of the Board amounted to a special delegation of power, is not borne out by the language of the resolution dated 26-10-1970. Where the Regulations provide that the Enquiry Officer shall be appointed by the Board, it is the Board which alone is competent to appoint the Enquiry Officer. There can be no contrary delegation under Section 43-A of the Board to appoint an Enquiry Officer on the Managing Director as the delegated power would be in conflict with the provisions of the Regulations. 24. Sri S.N. Upadhya then argued that under Regulation 9 it is provided that all appointments in Class A and B services shall be made by the Managing Director. He submits that on this basis the appointing authority of the petitioner was the Managing Director and as such he was competent to appoint an Enquiry Officer and act on the report of the Enquiry Officer appointed by him. 25. Sri S.N. Upadhya relied upon a decision of the Sup erne Court in the case of Pradyat Kumar Bose v. The Hon'ble the Chief Justice of Calcutta High Court, A.I.R. 1956 S.C. 285. In that case an enquiry had been instituted against the Registrar and Accountant was deputed by the Chief Justice to make an enquiry and submit his report. It was contended before the Supreme Court that there could be no such delegation of power. This argument was rejected by the Supreme Court. It was held that when a functionary who had to decide an administrative matter, such as the dismissal of a member of the staff, can obtain the material on which he has to act in such manner as may be feasible and convenient provided only the affected party has a fair opportunity to correct or contradict any relevant and prejudicial material. The objection to the appointment of Mr. Justice Dasgupta was rejected. 26. If no Regulations has been framed in regard to the manner in which an enquiry is to be conducted against an employee, Sri S.N. Upadhya would be right, but when the U.P. Financial Corporation has framed the Regulations, it must conform to those Regulations and cannot rely upon any general principle of law authorising appointment of an Enquiry Officer, by the Managing Director, to conduct the enquiry in any manner whatsoever. 27.
27. Sri S.N. Upadhya has not urged that the Board by its resolution dated 26-10-1970 ratified the action of the Managing Director appointing Sri A.M. Kar as an Enquiry Officer. In any case, a void order of appointment could not have been ratified by the Board. See in this connection the decision of Mysore High Court in the case of K. Panduranga and others v. State of Mysore and others, A.I.R. 1965 Mysore 244. In that case it was held that Tehsildar could only be appointed by the Government and where the Divisional Commissioner had appointed them under the orders of the Government, their appointment cannot be subsequently ratified by the Government by issuing a notification. It was held that a void order could not be ratified by the Government. 28. Sri S.N. Upadhya has urged that the petitioner in no manner was prejudiced. The illegality of the enquiry is itself a prejudice and the petitioner cannot be denied relief on the ground that he has not been prejudiced. 29. In this view of the matter, the order of dismissal cannot stand and have to be quashed. 30. While formulating the reliefs that have to be granted to the petitioner, certain factors will have to be taken into account. The petitioner was found on enquiry to have committed serious financial irregularities. Another factor that has to be taken into account is that this case is being decided in March, 1985; whereas the charges against the petitioner pertained to September, 1970. The petitioner was dismissed under the order dated 23-6-1971. 31. In the result, the writ petition succeeds in part. The impugned order of the Managing Director dated 23-6-1971 and the resolution of the Board of Directors dated 8-10-1971 as also the order of the Tribunal dated 16-5-1977 are quashed. The petitioner is directed to be treated as in service. It will be open to the U.P. Financial Corporation to proceed with the Enquiry against the petitioner. It is, however, for the authorities of the U.P. Financial Corporation to consider whether they will proceed with the enquiry or not in view of the length of time that has elapsed between the incident and the present day. I am not quashing the order of suspension which I find to be regular.
It is, however, for the authorities of the U.P. Financial Corporation to consider whether they will proceed with the enquiry or not in view of the length of time that has elapsed between the incident and the present day. I am not quashing the order of suspension which I find to be regular. The petitioner will be entitled to subsistence allowance from the date of order of dismissal to date, which should be paid to the petitioner promptly. The petitioner is entitled to his costs.