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1990 DIGILAW 199 (MAD)

P. S. Balasubramanian v. Chief General Manager, State Bank Of India

1990-03-01

BAKTHAVATSALAM

body1990
ORDER Bakthavatsalam, J. 1. The petitioner has come before this Court praying for the issuance of a writ of certiorari, quashing the order of dismissal of petitioner from service passed by the respondent on 29-9-1987 and directing the respondent to pay the petitioner his pension and other superannuation benefits due and payable to him. 2. The petitioner entered service in the Imperial Bank of India, now called State Bank of India, in the year 1945 and after service 6f nearly 40 years the last post held by him was Officer in the Junior Management Cadre and as such was working as Branch Manager, Thandikudi Branch, Kodiakanal Taluk till he attained the age of superannuation, that is 58 years, the actual date of his retirement being 28-2-1985. Though he attained the age of superannuation on 28-2-1985, he was permitted to continue in service even after that date, since the competent authority in exercise of its powers under the proviso to Section 19(1) of the State Bank of India Officers' (Determination of terms and conditions of Service) order, 1979, hereinafter referred to as DTCS Order, extended the period of service by one year upto 28-2-1986 and this order of extension of service was served on the petitioner on 23-3-1985. But by another letter dated 21-3-1985, which was served on the petitioner on 26-3-1985, the petitioner was placed under suspension in terms of Rule 50A(i) of the State Bank of India (Supervising Service Rules) under the cover of a charge. The charge sheet was served on the petitioner on 23-1-1986, and after due enquiry he was ultimately dismissed from service with effect from 28-2-1986, the date on which he ceases to be in service, by means of the order dated 29-9-1987. 3. In the affidavit filed in support of the writ petition the petitioner alleges that the entire disciplinary proceedings which culminated in his dismissal from service is illegal and not valid in law. It is the case of the petitioner that he retired from service on 23-2-1985 and till he received the letter of extension of his service he was practically kept in dark. In fact, after 23-2-1985 the petitioner ceased to be an employee of the bank, but, according to the Rules the actual date of retirement is 28-2-1985. But the order of suspension dated 21-3-1985 was served on him on 26-3-85. In fact, after 23-2-1985 the petitioner ceased to be an employee of the bank, but, according to the Rules the actual date of retirement is 28-2-1985. But the order of suspension dated 21-3-1985 was served on him on 26-3-85. Though he had already retired from service on 28-2-1985, by another letter dated 23-3-1985 his service was extended, which letter passed much after the order of suspension, and so it is illegal. Under Rule 19(3) of the DTCS Order, 1979, any disciplinary proceedings can be initiated against an officer only before he ceases to be an employee in the bank service. As such there cannot be any disciplinary proceedings or enquiry against the petitioner, when he ceased to be an employee of the bank. It is the further case of the petitioner that he retired on 23-2-1985. Even taking the superannuation at the end of the month, that is on 28-2-85, the letter of the respondent extending his service by one year was served on him one month after his retirement, that is on 23-3-1985, which clearly shows the malafides on the part of the respondent and the culmination of the letter of extension of service much after the order of suspension. It is alleged by the petitioner that it has been so done with a view to satisfy the requirements of the rules of the State Bank of India Officers Order, 1979. On another ground the petitioner attacks the order of dismissal and his sole ground is that by no stretch of imagination it can be said that after attaining the age of superannuation and on his having retired from service on 28-2-1985, the two orders passed one extending his service and another placing him under suspension are void and contrary to law. However, the petitioner has not made any allegations against the order of dismissal passed after the enquiry on the disciplinary proceedings, in the affidavit filed in support of the writ petition. His sole ground of attack lies on the only point that he was placed under suspension after he retired from service. 4. In the counter affidavit filed by the respondent-Bank it is stated that the petitioner is governed by the State Bank of India Officers (Determination of Terms and Conditions of Service) Order, 1979 (DTCS Order) in which paragraph 19 speaks about the age of retirement. 4. In the counter affidavit filed by the respondent-Bank it is stated that the petitioner is governed by the State Bank of India Officers (Determination of Terms and Conditions of Service) Order, 1979 (DTCS Order) in which paragraph 19 speaks about the age of retirement. According to the counter, the petitioner was born on 24-2-1927 and attained the age of superannuation of 58 years on 24-2-1985 and in the normal circumstances he should have applied for retirement from 28-2-1985. However, the petitioner continued to be in the service of the respondent Bank even after 28-2-1985, since the bank permitted him to do so. The petitioner attended the bank's branch and was performing his duties even after 28-2-1985. On 23-3-1985 the competent authority in exercise of its powers, as stated earlier, extended the period of his service by one year upto 28-2-1986 and this order was served on the petitioner on 23-3-1985 itself. It is stated in the counter that the respondent bank came to know of certain irregularities committed by the petitioner in the discharge of his duties in that he sanctioned large number of agricultural advances beyond his discretionary powers and he also misused his position in the grant of other loans. By letter dated 21-3-1985 he was informed of serious irregularities committed by him while he was working as Branch Manager of Tandikudi branch and so he was placed under suspension and the said letter was served on him on 26-34985, It is stated that on 21-3-1985 when the order of suspension was issued'" the petitioner was very much in service. Even as on 26-3-1985, when the; order of suspension was served on the petitioner, he continued to be in the service of the bank and more so by reason of the order of extension dated 23-3-1985. The petitioner was paid full salary and allowances for March 1985 till he was placed under suspension and thereafter for the subsequent period of suspension he was paid subsistence allowance. During the extended period of his service, after his attaining, the age of 58 years, the petitioner was served with charge sheet on 23-1-1986 and disciplinary action was proceeded with. The petitioner was paid full salary and allowances for March 1985 till he was placed under suspension and thereafter for the subsequent period of suspension he was paid subsistence allowance. During the extended period of his service, after his attaining, the age of 58 years, the petitioner was served with charge sheet on 23-1-1986 and disciplinary action was proceeded with. Since the disciplinary action could not be completed during the extended period of service, the respondent bank in exercise of its power under Section 19 9(3) of the, DTCS Order issusd a letter dated 17-2-1986 ordering retirement of the petitioner from service with effect from 28-2-1986 and stating that he will be deemed to'be in service exclusively for the purpose of continuance and conclusion of disciplinary proceedings initiated against him, even after he ceases to be in bank's service with effect from 28-2-1986. It is further stated in the counter that the departmental action against the petitioner was proceeded with and the enquiry officer gave his report in September 1987 and after that the order of dismissal was passed dismissing the petitioner from service with effect from, 28-2-1986, The petitioner preferred an appeal against the order of dismissal and the same was confirmed by the Local Board in its meeting held on 24-9-1988, dismissing his appeal. It is stated that the disciplinary action initialed against the petitioner after he completed 58 years of age, which ultimately resulted in his dismissal, was perfectly justified. The fact that the petitioner retired from service on 28-2-1985 is denied. It is stated that while the petitioner was liable to be retired on 23-2-1985, he has not actually retired from service. He not only continued to remain in service but also attended his duties and work in the branch even after 28-2-1985 and received his salary for the month of March 1985. On 23-3-1985, when the petitioner was served with a letter extending his service, it was only a confirmation of the extension of service which even without an order in writing was in operation (emphasis supplied by me) The petitioner has deliberately omitted to mention that, till he was served with the order dated 23-3-1985, he was continuing his service and attending to his duties in the Thandikudi branch after 23-2-1985. Therefore it is not correct to say that the petitioner has retired from service on 23-2-1985. Therefore it is not correct to say that the petitioner has retired from service on 23-2-1985. Having enjoyed the privilege of salary for the period of his service till 26-3-1985 and having taken part in the disciplinary proceedings, it is not open to the petitioner to challenge the same. The petitioner acquiesced to the extension of service till 28-2-1986 and having done so he cannot question the same now with a view to challenge the disciplinary action. It is also stated that the writ petition is not maintainable as final orders have been passed on the disciplinary proceedings and having participated in the proceedings the petitioner should not question the order of dismissal passed long after his continuance in service. 5. In the reply affidavit filed by the writ petitioner, it is staled that paragraph 19(1) of the DTCS order deals with retirement and extension of service while paragraph 19(2) declares through a deeming provision that if an officer ceases to be in the Bank's service by the operation of or by virtue of any provision of the order, he shall not be deemed to have retired from the Bank's service for the purpose of Imperial Bank of India Employees Pension Fund and Guarantee Fund Rules or the State Bank of India Employee's Fund Rules, unless such cessation of service has been sanctioned as retirement for the purpose of either of the said Fund Rules. In other words, the limited purpose, of paragraph 19(2) is only to determine the eligibility for the Pension Fund Rules and it is not for the purpose of determining whether a person has or has not retired which is determined by paragraph 19(1) alone. That is, when an officer has reached the age of 58 years, paragraph 19(1) mandates his retirement Paragraph 19(2) stipulates that unless the cessation of service has been sanctioned as 'retirement' for the purpose of Pension Fund Rules, one shall -not be deemed to have retired. Unless such sanction is accorded, the retiring officer will not be eligible to receive his pension. Therefore the petitioner states that despite the absence of the sanction of the cessation of service as stipulated in paragraph 19(2), he has retired on attaining the age of 58 in accordance with paragraph 19(1). Unless such sanction is accorded, the retiring officer will not be eligible to receive his pension. Therefore the petitioner states that despite the absence of the sanction of the cessation of service as stipulated in paragraph 19(2), he has retired on attaining the age of 58 in accordance with paragraph 19(1). It is also stated that the proposition 'extension of service' would amount to forced labour and would be against the public policy and consequently void. It is stated that the petitioner need not apply for retirement from 28-2-1985 and paragraph 19(1) of the DTCS order operates automatically on attaining the age of 58. It is also stated that the petitioner retired from service for all practical purposes on 28-2-1985 and thus the period of service for retirement and pension purpose is from 23-2-1945 to 28-2-1985 only. The petitioner continued to attend office and his service from 1-3-1985 onwards should be treated as 'Day to Day' service for honorarium. Even otherwise the service rendered by the petitioner from 1-3-1985 has to be treated as a new contract of service. In either case, there is no relationship whatsoever to the earlier contract of service which ended on 28-2-1985. It is further stated that, only a person who is in service can be offered an extension of service and when a person is ceased to be an employee and in this case on 28-2-1985, there cannot be any extension of service that too after 23-3-1985. It is stated that the concerned authorities made a mistake and failed to follow the proper procedure. The appropriate authority to extend the service of the petitioner is the Chief General Manager. But the letter of extension' served on him on 23-3-1985 was signed by the Regional Manager, whose rank was lower than that of the Chief General Manager. It is also stated in the reply affidavit that the letter of suspension dated 21-3-1985 was not served and the same was served only after the order extending his service was passed. Therefore the letter of suspension dated 21-3-1985 was released and served so as to be received by him on 26-3-1985. It is therefore stated that the order of suspension takes effect from 21-3-1985, although received by the petitioner on 26-3-1985 and hence the so-called order of extension dated 23-3-1985 as well as the suspension letter are nullity and without the force of law. It is therefore stated that the order of suspension takes effect from 21-3-1985, although received by the petitioner on 26-3-1985 and hence the so-called order of extension dated 23-3-1985 as well as the suspension letter are nullity and without the force of law. The petitioner denies the so-called extension of service and states that it was a mala fide exercise of power. It is stated that the petitioner wanted to leave the Bank with clear conscience and therefore did not even bother to take legal opinion and cooperated with the proceedings. The writ petitioner attacks the order of dismissal on various grounds which are not necessary to set out here in view of the short point to be seen whether the order of suspension was while the petitioner was in service. 6. Mr. P. Venkataraman, learned Counsel for the petitioner, contends that the petitioner attained the age of superannuation on 23-2-J.985 and as per rules he retired effectively from service on 28-2-1985, the end of the month, and therefore the date of superannuation of the petitioner is 28-2-1985 and that therefore any action taken after the date of his retirement is void ab initio. He also contends that the extension order passed on 23-3-1985 was without jurisdiction and with mala fide intention; that the petitioner was not given an opportunity to put forth his case before the passing of the order of dismissal and hence the order of dismissal is void on the ground of non application of mind; that no show-cause notice was given and the past service of the petitioner was not taken into consideration. Learned Counsel for the petitioner refers to paragraph 19(1) of the DTCS Order and relies on two decisions viz. Rangachari v. Secy. of State (1937) I MLJ 515; 64 I.A. 40; 1937 MWN 100 : ILR 1937 Mad. 517 A.I.R. 1937 P.C. 27 and State of Assam v. Padma Ram for the proposition that a person cannot be placed under suspension after he retired, from service. Learned Counsel also contends that the competent authority to pass the order of dismissal was the Chief General Manager of the Circle, whereas in this case the order of dismissal was passed by an authority lower in rank. 7. Learned Counsel also contends that the competent authority to pass the order of dismissal was the Chief General Manager of the Circle, whereas in this case the order of dismissal was passed by an authority lower in rank. 7. Learned Counsel for the respondent Bank on the other hand contends that the petitioner completed 30 years of competent service in 1975, yet he continued to be in service till the age of 58 and as such it should be taken that there was an implied extension of contract of service. The petitioner continued to be in service even after 30 years of service and likewise nothing prevented him to have his service continued even after 28-2-1985. Learned Counsel also contends that the extension of service need not be in writing and it can be implied by the conduct of parties. He also submits that an order takes effect only when it is served and in this case the order of suspension was served on the petitioner only after the order of extension of service was served on him and as such the contention raised by the petitioner that the order of suspension dated 21-3-1985 was made even before the order of extension of service is not correct. Learned Counsel further says that the petitioner acquiesced himself to the extension of service and worked in March 1985 and as such now he cannot turn round and say that the order of dismissal is bad. The counsel for the bank also contends that the petitioner cannot at this stage say that all the proceedings are void especially after taking part in the disciplinary proceedings. It is the contention of the respondent-bank that an employee cannot walk out unilaterally on the date of retirement and the employer-bank should pass an order retiring the employee from service and then only the service of the employee comes to an end or he ceases to be an employee. It is once again contended that a decision to extend the service of the petitioner was taken by the Circle Management Committee even before the date of retirement of the petitioner on 28-2-1985, but this was communicated to him only on 23-3-1985 and so the order is very much valid in law. It is once again contended that a decision to extend the service of the petitioner was taken by the Circle Management Committee even before the date of retirement of the petitioner on 28-2-1985, but this was communicated to him only on 23-3-1985 and so the order is very much valid in law. A xerox copy of the proceedings of the Committee has been placed before me in support of the contentions raised by the learned Counsel for the respondent-Bank. 8. I have given my due consideration to the arguments advanced on either side and I am of the view that the order of dismissal passed in this case against the writ petitioner has no legs to stand. It is not in dispute that the petitioner attained the superannuation age of 58 on 28-2-1985. Paragraph 19 of the DTCS Order, 1979 deals with the age of retirement and it is to the following effect: 19(1) An officer shall retire from the service of the Bank on attaining the age of fifty-eight years or upon the completion of thirty years service or thirty years' pensionable service if he is a member of the Pension Fund, whichever occurs first. Provided that the competent authority may, at its discretion, extend the period of service of an officer who has attained the age of fifty-eight years or has completed thirty years' service or thirty years' pensionable service as the case may be, should such extension be deemed desirable in the interest of the Bank, so however, that the service rendered by the concerned officer beyond 58 years of age except to the extent of the period of leave due at that time will not count for purpose of pension. Provided further that an officer may, at the discretion of the Executive Committee, be retired from the Bank's service after he has attained 50 years of age or has completed 25 years' service or 25 years pensionable service as the case may be, by giving him three months' notice in writing or pay in lieu thereof. Provided further that an officer who has completed 25 years' service or 25 years' pensionable service, as the case may be, may be permitted by the Executive Committee to retire from the Bank's service, subject to his giving three months' notice in writing or pay in lieu thereof unless this requirement is wholly or partly waived. 2. Provided further that an officer who has completed 25 years' service or 25 years' pensionable service, as the case may be, may be permitted by the Executive Committee to retire from the Bank's service, subject to his giving three months' notice in writing or pay in lieu thereof unless this requirement is wholly or partly waived. 2. Notwithstanding any thing to the contrary in this order, no officer who has ceased to be in the Bank's service by the operation of, or by virtue of, any provision shall be deemed to have retired from the Bank's service for the purpose of the Imperial Bank of India Employees' Pension arid Guarantee Fund Rules or the State Bank of India Employees' Pension Fund Rules unless such cessation of service has been sanctioned as retirement for the purpose of either of the said pension fund rules as may be applicable to him. 3. In case disciplinary proceeding under the relevant rules of service have been initiated against an officer before he ceases to be in the Bank's service by the operation of, or by virtue of, any of the said rules or the provisions of this order, the disciplinary proceedings may, at the discretion of the Managing Director, be continued and concluded by the authority by which the proceedings were initiated in the manner provided for in the said Rules as if the officer continues to be in service, so however, that he shall be deemed to be in service only for the purpose of the continuance and conclusion of such proceedings. Explanation: An officer will retire on the last day of the month in which he completes the stipulated service or age of retirement. It will be seen from the above that an officer shall retire from service on his attaining the age of 58 years or upon the completion of thirty years' service or 30 years pensionable service, if he is a member of the Pension Fund, whichever occurs first. There is a proviso which says that the competent authority may at its discretion extend the period of service of an employee who attained the age of 58 years or has completed thirty years service or thirty years' pensionable service. There is a proviso which says that the competent authority may at its discretion extend the period of service of an employee who attained the age of 58 years or has completed thirty years service or thirty years' pensionable service. Clause 3 of the above paragraph 19 says that in case the disciplinary proceedings under the relevant rules of service have been initiated against an officer before he ceases to in the service of the Bank, by operation of or by virtue of any of the said Rules or the provisions of this order, the disciplinary proceedings. It further provides that the officer shall be deemed to be in service only for the purpose of continuance and conclusion of such proceedings. The explanation to paragraph 19 extracted above, states that the officer will retire on the last day of the month. In this case the petitioner though attained the age of superannuation on 23-2-1985, retired from service on 28-2-1985 and there is no dispute with regard to that aspect. The petitioner was placed under suspension according to Rules on 21-3-1985 and that order was served on him on 26-3-1985. In the meantime the petitioner's service was extended by order dated 23-3-1985, which was served on him on that date itself. Now it has to be seen whether the petitioner was placed under suspension and the said suspension order was passed while the petitioner was in service or not. In my considered view, he is not. It is well settled that the order of suspension though served on a later date, it takes effect from the date of passing of the said order, that is from 21-3-1985. It is also clear from the records that when the order extending the service of the petitioner was made and served, the petitioner was not in service, as he retired as per Clause (1) of paragraph 19 of the DTCS Order. Though the respondent Bank would contend that a decision was taken by the Committee and was communicated to the petitioner, while the petitioner was in service, I am not able to agree that the said decision suspending the petitioner from service was taken while the petitioner was in service. 9. So the next point arises is whether the further proceedings taken place after the retirement of the petitioner was valid in law. 9. So the next point arises is whether the further proceedings taken place after the retirement of the petitioner was valid in law. In my view, the entire proceedings having taken place after 28-2-1985 are void ab initio. I am not able to agree with the contention of the learned Counsel for the respondent-Bank that the petitioner has acquiesced to the disciplinary proceedings and having done so he cannot question the same. It is well accepted principle that any amount of acquiescence on the part of a person will not confer jurisdiction on any authority, when the question goes to the root of the matter, that is jurisdiction. I think, learned Counsel for the petitioner is right in saying that all the proceedings subsequent to the date of superannuation, i.e, 28-2-1985, have to be taken as null and void. In Rangachary v. Secretary of State A.I.R. 1937 Privy Council 27 the Privy Council held as follows: ..It seems to require no demonstration that an order purporting to remove the appellant from the service at a time when, as their Lordships hold, he had for some months duly and properly ceased to be in the service, was a mere nullity and cannot be sustained. Again in State of Assam v. Padma Ram the Supreme Court held that an order as to extension of service made on date when servant had ceased to be in service was a nullity. In that case the Supreme Court observed as follows: We do not think that the State Government had any jurisdiction to pass such an order on May 9,1961. According to the earlier order of the State Government itself, the service of the respondent had come to an end on March 31,1961. The State Government could not by unilateral action create a fresh contract of service to take effect from April, 1 1961. if the State Government wished to continue the service of the respondent for a further period, the State Government should have issued a notification before March 31,1961. Having observed thus and after referring to the decision of the Privy Council, quoted above, the Supreme Court came to the conclusion that the order of retention in service passed more than a month thereafter was a mere nullity and cannot be sustained. Having observed thus and after referring to the decision of the Privy Council, quoted above, the Supreme Court came to the conclusion that the order of retention in service passed more than a month thereafter was a mere nullity and cannot be sustained. I think, these two decisions, one by the Privy Council and the other by the Supreme Court, applies to the issue raised in this case. 10. In my view, the argument of the learned Counsel for the respondent-bank that the continuation of service in 1975, even after the completion of 30 years service, has to be taken as a part of the service, has to be rejected on the simple ground that even if he continued after the completion of 30 years, the other limitation such as attainment of age of 58 is there. Paragraph 19 (1) of the DTCS Order clearly states that an officer shall retire from service on attaining the age of 58 years and there is nothing in that order requiring an order to be given by the bank to every officer asking of his retirement. In my view the retirement is automatic, subject of course to Clause 2 of paragraph 19 of the DTCS Order, which says that cassation of service has to be sanctioned as retirement for the purpose of getting retirement benefits like Pension. As such, normally any employee will expect an order under Clause 2 of paragraph 19 of the DTCS Order in order to get his retirement benefits like pension either under the Imperial Bank of India Employees Pension and Guarantee Fund Rules or the State Bank of India Employees' Pension Fund Rules. Apart from that I do not think there is any necessity for an employee of the bank to wait for an order from the Bank, once he attains the age of 58 years. It is true that Clause 3 of Paragraph 19 of the DTCS Order gives the power to the Bank that if any disciplinary proceedings have been initiated against an employee before he ceases to be in the Bank's service (emphasis supplied by me) by the operation of, or by virtue of, any of the said rules or the provisions of the order, the employee shall be deemed to be in service only for the purpose of conclusion of such proceedings. But here, the officer has retired on his attaining the age of, 58 and no order of extension of service was served on him before his retirement and as such in my view both the orders, suspending him from service and extending his service, have no effect. 11. The contention of the learned Counsel for the writ petitioner that the appropriate authority has not passed the order is not correct, because I find from the proceeding of the Committee placed before me that the said Committee has considered the extension to be given to the petitioner, but that extension recommended for one year from 24-2-1985 to 23-2-1986 has not been unfortunately communicated to the petitioner before he retired from service on 28-2-1985. 12. Without going into the various other averments made in the affidavit filed in support of the writ petition, and the arguments advanced by the learned Counsel on either side, and, without entering into the merits of the case, this writ petition is allowed, setting aside the order of dismissal of the petitioner from service. The respondent bank is directed to settle the retirement benefits of the petitioner within a period of two months. There will be no order as to costs.