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2019 DIGILAW 796 (MP)

M. P. State Co-operative Dairy Federation Ltd. v. L. S. Patel

2019-11-15

RAJEEV KUMAR SHRIVASTAVA, SHEEL NAGU

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JUDGMENT 1. This intra-Court appeal preferred by the employer u/S 2(1) of the Madhya Pradesh Uchcha Nyayalaya (Khand Nyayapeeth Ko Appeal) Adhiniyam, 2005, questions the legality and validity of Order dated 15.4.2019 [WP.17423/2017] passed by learned Single Judge in exercising writ jurisdiction under Article 226 of the Constitution. 2. The pivotal question, which begs for an answer in the present case, is as to whether in the absence of any enabling provision under the relevant service regulations, could the employer/appellants herein continue with the disciplinary proceedings commenced vide charge-sheet dated 30.4.2002, even after retiring the petitioner in public interest with effect from 30.6.2002 and thereafter culminating the disciplinary proceedings vide impugned Order dated 11.7.2006 by holding the respondent guilty and forfeiting the entire amount of gratuity. 3. Before adverting to the adjudication of the issue involved, it would be apt to mention that by the impugned Order of the learned Single Judge dated 15.4.2019 passed in WP. 17423/2017 the Order of forfeiture of gratuity dated 11.7.2006 has been held to be bad in law with direction to release the entire amount of gratuity within 90 days. However, the statutory interest admissible u/S. 7(3A) of the Payment of Gratuity Act, 1972 (“1972 Act” for brevity) was declined on the ground of delay and latches. 4. The employee/respondent herein has successfully assailed the aforesaid Order of the learned Single Judge in WA. 759/2019 which has been allowed on 15.11.2019 directing release of statutory interest u/S 7(3A) of 1972 Act admissible to the petitioner due to non-payment of principal amount of gratuity within one month of retirement. 5. The contention of learned counsel for employer/appellants herein is that the Order of forfeiture was rightly passed under the provisions of 1972 Act, which enables the employer to forfeit the amount of gratuity if the conduct of the employee is found, in enquiry, to cause pecuniary loss to the employer or the conduct involves moral turpitude. It is submitted that since the petitioner had been convicted under the provisions of Prevention of Corruption Act by the criminal Court of competent jurisdic-tion sentencing him to RI of two years with fine, the relevance of moral turpitude and the misconduct on the part of petitioner/employee is palpable. For this purpose, the provision of section 4(6)(b)(ii) of the 1972 Act is pressed into service. 6. For this purpose, the provision of section 4(6)(b)(ii) of the 1972 Act is pressed into service. 6. Instead of testing the impugned Order of forfeiture of gratuity on the anvil of provisions of 1972 Act, it would be apposite to first analyze whether the employer was possessed with any authority of law to have continued with the disciplinary proceedings even after compulsorily retiring the respondent/employee with effect from 30.6.2002. 6.1 It is trite law in service jurisprudence that an employer does not have inherent powers to continue with disciplinary proceedings after the retirement of an employee unless the relevant service regulations contain an enabling provision empowering the employer to continue with disciplinary proceedings and conclude it after retirement. This Court is bolstered in it's view by various verdicts of the apex Court, one of which [para 7 of “Bhagirathi Jena v. Board of Directors, O.S.F.C. and others (1999) 3 SCC 666 ”] is extracted below for ready reference and convenience: “7. In view of the absence of such a provision in the abovesaid regulations, it must be held that the Corporation had no legal authority to make any reduction in the retiral benefits of the appellant. There is also no provision for conducting a disciplinary enquiry after retirement of the appellant and nor any provision stating that in case misconduct is established, a deduction could be made from retiral benefits. Once the appellant had retired from service on 30.6.1995, there was no authority vested in the Corporation for continuing the departmental enquiry even for the purpose of imposing any reduction in the retiral benefits payable to the appellant. In the absence of such an authority, it must be held that the enquiry had lapsed and the appellant was entitled to full retiral benefits on retirement.” 6.2 From the aforesaid exposition of law by the apex Court which continues to hold the field till date, there is no manner of doubt that in absence of enabling provision under the relevant service regulations governing the service conditions of the employee concerned, the employer is bereft of any jurisdiction to proceed with the disciplinary enquiry against the employee concerned even after his retirement. 7. The appellants/employer, by way of Document No. 9618/2019 filed on 18.10.2019 has brought on record the Madhya Pradesh Rajya Dugdha Mahasangh (Sahakari) Maryadit Bharti Vargikaran Tatha Sewa Shartein Viniyam, 1985. 7. The appellants/employer, by way of Document No. 9618/2019 filed on 18.10.2019 has brought on record the Madhya Pradesh Rajya Dugdha Mahasangh (Sahakari) Maryadit Bharti Vargikaran Tatha Sewa Shartein Viniyam, 1985. Bare perusal of the aforesaid Regulations, 1985, under which the respondent/employee has been compul-sorily retired in public interest by invoking Clause 13(1), does not disclose any enabling provision empowering the employer to continue with disciplinary proceedings even after retirement of any particular employee. 7.1 In the absence of any enabling provision in the Regulations of 1985, it is surprising to note that the appellants/employer after retiring the employee with effect from 30.6.2002 (vide Annexure P-4) in public interest directed for continuance of the disciplinary proceedings which were pending against the respondent/employee at the time of said compulsory retirement. 7.2 It appears that employer was totally oblivious of the legal position. This Court, as a measure of added precaution, asked the learned counsel for the appellants/employer to go through the entire service Regulations to inform this Court in regard to any enabling stipulation therein. The counsel for the appellants/employer after having gone through the Regulations has disclosed in categorical terms that the Regulations do not contain any provision enabling the employer to proceed with disciplinary enquiry even after retirement of an employee. 8. In view of above, this Court has no manner of doubt that the Order of forfeiture of gratuity dated 11.7.2006 which was passed in a disciplinary proceedings which were kept pending after retiring the respondent/employee on 30.6.2002 was without any authority of law and thus void ab initio. Learned Single Judge has already declared the forfeiture of gratuity to be unlawful by the Order assailed herein, though for different reasons. 9. Thus, this Court is left with no option but to dismiss the appeal of the employer with exemplary cost for having acted in a manner which is blatantly contrary to the provisions of law thereby compelling the respondent/employee in the evening of his life to contest a frivolous litigation in shape of the present writ appeal, preferred by the employer. 10. Consequently, the present appeal stands dismissed with cost which is quantified at Rs.10,000/- (Rupees Ten Thousand Only) to be paid by appellants/employer by digital transfer to the bank account of petitioner, within 30 days of petitioner furnishing necessary bank details.