Chief Executive Officer, Uttar Pradesh State Industrial Development Authority v. Ramesh Kumar Saini
2023-05-25
SUNITA AGARWAL, VIKAS BUDHWAR
body2023
DigiLaw.ai
JUDGMENT : Heard learned counsel for the parties and perused the record. 2. This appeal is directed against the judgment and order dated 21.3.2023 passed by the learned Single Judge whereby the writ petition has been allowed setting aside the punishment order dated 14.10.2020, the inquiry report dated 11.6.2019 as well as the appellate order, by noticing in one paragraph only that no witnesses were produced by the department to prove the documents which were relied on in the inquiry to prove the allegations of financial irregularities against the writ petitioner. The inquiry itself is found to be vitiated being in violation of Rule 7 of the U.P. Government Servant (Discipline and Appeal) Rules 1999, for the said reason. 3. Sri Swapnil Kumar learned counsel for the appellant, at the outset, urged that a perusal of the inquiry report itself indicates that the writ petitioner, who was posted as the Accounts Clerk in the department concerned namely the office of the Chief Engineer (Projects), himself had admitted that he had submitted a 'Note' for payment to the contractor without completion of the work assigned to him and presentation of detail bills. 4. The 'Note' submitted by the writ petitioner to the Manager (Accounts) for release of payment were, thus, put up without adopting due procedure, which had resulted in release of amount of Rs. 22.97 crores illegally to the contractor. 5. The documents relied by the Inquiry Officer to prove the charges against the writ petitioner were never disputed by him during the course of inquiry and, as such, there was no occasion to further secure witnesses to prove the said documents. Charge No. 1 which has been held proved against the writ petitioner in the inquiry report amount to misconduct within the meaning of Rule 3 of Rules 1999 and, as such, the order passed by the disciplinary authority dated 14.10.2020 for removal of the writ petitioner from service cannot be said to suffer from any error of law, much less any defect in the inquiry. 6. It is further argued that even in case of any defect, the entire inquiry cannot be vitiated and only course open for the Court in that eventuality is to relegate the matter for fresh inquiry from the stage the defect has occurred.
6. It is further argued that even in case of any defect, the entire inquiry cannot be vitiated and only course open for the Court in that eventuality is to relegate the matter for fresh inquiry from the stage the defect has occurred. In the instant case, the learned Single Judge without assigning any reasoning in the order impugned has set aside the entire inquiry as vitiated being in violation of Rule 7 of Rules 1999, without any discussion as to the stage at which the defect has arisen. 7. The liberty granted to the appellant to proceed from the stage of the charge-sheet after providing the list of witnesses to the writ petitioner is of no relevance, in as much as, the documentary evidence namely the 'Note sheet' prepared by the writ petitioner without submission of bills by the contractor was never disputed and rather admitted. 8. The submission, thus, is that no infirmity could be found in the order passed by the disciplinary authority on the allegations which were found proved as charge No. 1, mentioned in the charge-sheet. The disciplinary authority had also considered the reply submitted by the writ petitioner to the second show-cause notice on the proposed punishment. 9. Sri Ajeet Dwivedi learned counsel appearing for the respondent/writ petitioners, on the other hand, submits that the writ petitioner has been singled out in the matter of grant of punishment by the disciplinary authority. The charge against the writ petitioner was that he had submitted 'Note' for release of payment to the contractor between March 2006 to May, 2007 to senior officers though the contractor was not entitled to receive payment by the said date. The 'Note' submitted by the writ petitioner was without submission of detail bills by the contractors. The charge, thus, was that the writ petitioner was instrumental in release of Rs. 22.97 crores to the contractor and in the said payment, at the initial stage, the writ petitioners had violated the financial rules/provisions. 10. The explanation offered by the writ petitioners was that the 'Note' was submitted by him on the instruction of the Executive Engineer/Head Office/Manager (Accountant). The bills were submitted by the contractor on the date of release of payment itself and, as such, there was no irregularity in the release of contract money as they were not released without bills/voucher/cheques.
10. The explanation offered by the writ petitioners was that the 'Note' was submitted by him on the instruction of the Executive Engineer/Head Office/Manager (Accountant). The bills were submitted by the contractor on the date of release of payment itself and, as such, there was no irregularity in the release of contract money as they were not released without bills/voucher/cheques. It was also stated that all the payments were made against the work completed by the contractor, verified physically, though the bills were submitted with some delay. The work under the contract had already been executed before the date of payment. As regards the second charge, it was argued by the learned counsel for the writ petitioner that the same was not proved against the writ petitioner. Further, on charge No. 1, the finding is that though no financial irregularity has been committed and the payment of Rs. 22.97 crores has been adjusted against the work completed by the contractor but the writ petitioner did not complete the necessary procedure as per Financial Handbook Vol-6 for release of the payment in 42 matters where the 'Note' on the sheet was submitted by him only on the telephonic instructions without submission of the bills. 11. The contention of the learned counsel for the writ petitioner is that the irregularity in the procedure adopted by the writ petitioner would not come within the meaning of misconduct as per Rule 3 of the Government Servant (Discipline and Appeal) Rules, 1999, in as much as, there is no charge of financial irregularity or any payment having been made paid to the contractor in illegal manner on the 'Note' submitted by the writ petitioner. Even otherwise, the writ petitioner was neither the sanctioning authority nor he was entrusted with the task of release of payment to the contractor. The payments were made at the ends of the Manager (Account) on the approval of the then Chief Engineer (Project), in whose office, the writ petitioner was working as Accounts Clerk. 12. The attention of the Court is invited to the communication dated 10.8.2021 whereunder it was intimated that the disciplinary inquiry was though initiated against the Chief Engineer (Project), but the same was culminated with the imposition of punishment of withholding of two increments with cumulative effect.
12. The attention of the Court is invited to the communication dated 10.8.2021 whereunder it was intimated that the disciplinary inquiry was though initiated against the Chief Engineer (Project), but the same was culminated with the imposition of punishment of withholding of two increments with cumulative effect. Later on, even the said punishment order was set aside by the then Managing Director and the matter was relegated for fresh inquiry. The fresh inquiry initiated after relegation was brought to an end, exonerating the officer who was responsible for payment to the contractor on the 'Note' submitted by the writ petitioner whereas the appeal filed by the writ petitioner against the punishment order had been rejected vide order dated 20.9.2021 on the premise that he had committed serious financial irregularities. This apart, no inquiry whatsoever had been conducted against the Manager (Accounts) who had proceeded on the note submitted by the writ petitioner. The submission, thus, is that the petitioner alone cannot be held responsible for any irregularity (though no illegality) in the payment made to the contractor and the conclusion drawn by the disciplinary authority as also the appellate authority that the act of the petitioner had resulted in commission of or amount to financial irregularity is wholly uncalled for. 13. The officers on whose instructions the petitioner had submitted the office note and who had acted on the same, have been conveniently exonerated of all the allegations of commission of irregularity in the payment, if any, made to the contractor. The writ petitioner having been singled out does not deserve such a harsh punishment of removal from service. 14. Having noted the submissions of the learned counsel for the parties and perused the record, we find that there is no dispute about the fact that the writ petitioner was posted in the office of Chief Engineer (Project) and submitted 'Note' for different development works in 42 matters conducted in the department. There is also no dispute about the fact that the 'Note' submitted by the writ petitioner was subject to the approval of the competent authority namely the Manager (Account) and the Chief Engineer (Project). The payment to the contractor was not released either at the ends of the writ petitioner or simply on the 'Note' submitted by him rather it was made only after the approval of the above higher authorities.
The payment to the contractor was not released either at the ends of the writ petitioner or simply on the 'Note' submitted by him rather it was made only after the approval of the above higher authorities. The explanation offered by the writ petitioner that he was instructed by the Executive Engineer, Head Office/Manager (Accounts) for submission of the 'Note' telephonically and all payments were made only after submission of the bill by the contractor as also on completion of execution of the work, has not been disputed by the appellant herein. There is no dispute about the fact that no illegal payment had been made to the contractor and the payment of Rs. 22.97 crores was adjusted against the work conducted by the contractor which was further proved from the measurement of the work conducted. There was some delay in submission of bills by the contractor but on the date of release of payment, bill/vouchers were duly presented. The inquiry report dealing with charge No. 1 found proved against the writ petitioner, records the finding that in submission of the 'Office Note', the writ petitioner did not follow the requisite procedure. 15. The allegation in charge No. 1 found proved against the writ petitioner only records that the procedure for submission of the 'Note' before the Manager (Accounts) had not been followed by the writ petitioner. However, the fact remains that the writ petitioner alone cannot be held responsible for financial irregularity on account of the release of Rs. 22.97 crores, in as much as, the inquiry report itself records that the Corporation did not suffer any financial loss as the money paid to the contractor was adjusted against the work completed by him in the month of May, June to November, 2007. The only charge proved against the writ petitioner is of not adhering to the procedure prescribed for the purpose of submission of the 'office Note' in financial matters. 16.
The only charge proved against the writ petitioner is of not adhering to the procedure prescribed for the purpose of submission of the 'office Note' in financial matters. 16. Taking a conspectus of the allegations that have been found proved against the writ petitioner, we may note that the disciplinary authority while accepting the inquiry report has imposed major punishment of removal from service, without considering the explanation submitted by the writ petitioner that he was not guilty of submission of the 'Note', in as much as, it was submitted to proceed for release of payment on the instructions of the senior official, against whom no inquiry whatsoever has been conducted. 17. Coming to the legal aspect of the matter, on the proportionality of punishment of removed/imposed in the abovenoted facts and circumstances of the case, the Apex Court in the case of Chairman cum Managing Director, Coal India Ltd and others v. Mukul Kumar Choudhuri and others, (2009) 15 SCC 620 , while considering the question of quantum of punishment, has considered the doctrine of proportionality in the administrative law in India. Referring to various decisions of the Apex Court beginning from 1987 and some important English decisions, it was noted that the Apex Court in the Union of India and another v. G. Ganayutham, (1997) 7 SCC 463 , has summed up the position of proportionality in administrative law in England and India in the following manner: ''23....... (1) To judge the validity of any administrative order or statutory discretion, normally the Wednesbury test is to be applied to find out if the decision was illegal or suffered from procedural improprieties or was one which no sensible decision-maker could, on the material before him and within the framework of the law, have arrived at. The Court would consider whether relevant matters had not been taken into account or whether irrelevant matters had been taken into account or whether the action was not bona fide. The Court would also consider whether the decision was absurd or perverse. The Court would not however go into the correctness of the choice made by the administrator amongst the various alternatives open to him. Nor could the Court substitute its decision to that of the administrator. This is the Wednesbury test.
The Court would also consider whether the decision was absurd or perverse. The Court would not however go into the correctness of the choice made by the administrator amongst the various alternatives open to him. Nor could the Court substitute its decision to that of the administrator. This is the Wednesbury test. (2) The Court would not interfere with the administrator's decision unless it was illegal or suffered from procedural impropriety or was irrational - in the sense that it was in outrageous defiance of logic or moral standards. The possibility of other tests, including proportionality being brought into English administrative law in future is not ruled out. These are the CCSU principles. (3)(a) As per Bugdaycay ( 1987 AC 514 ), Brind and Smith as long as the Convention is not incorporated into English law, the English Courts merely exercise a secondary judgment to find out if the decision-maker could have, on the material before him, arrived at the primary judgment in the manner he has done. (3)(b) If the Convention is incorporated in England making available the principle of proportionality, then the English Courts will render primary judgment on the validity of the administrative action and find out if the restriction is disproportionate or excessive or is not based upon a fair balancing of the fundamental freedom and the need for the restriction thereupon. (4)(a) The position in our country, in administrative law, where no fundamental freedoms as aforesaid are involved, is that the Courts/tribunals will only play a secondary role while the primary judgment as to reasonableness will remain with the executive or administrative authority. The secondary judgment of the Court is to be based on Wednesbury and CCSU principles as stated by Lord Greene and Lord Diplock respectively to find if the executive or administrative authority has reasonably arrived at his decision as the primary authority. (4)(b) Whether in the case of administrative or executive action affecting fundamental freedoms, the Courts in our country will apply the principle of ''proportionality'' and assume a primary role, is left open, to be decided in an appropriate case where such action is alleged to offend fundamental freedoms. It will be then necessary to decide whether the Courts will have a primary role only if the freedoms under Articles 19, 21 etc. are involved and not for Article 14.'' 18.
It will be then necessary to decide whether the Courts will have a primary role only if the freedoms under Articles 19, 21 etc. are involved and not for Article 14.'' 18. It was further noted that in Ranjit Thakur v. Union of India, (1987) 4 SCC 611 , as also in B.C Chaturvedi v. Union of India, (1995) 6 SCC 749 , the Court had interfered with the punishment only on coming to the conclusion that the punishment was in outrageous defiance of logic and was shocking. It was also found to be perverse and irrational. It was held that if punishment imposed by the disciplinary authority or the appellate authority shocks the conscience of the High Court/Tribunal, it would appropriately mould the relief, either directing the disciplinary authority/appellate authority to reconsider the penalty imposed, or to shorten the litigation, it may itself, in exceptional and rare cases, impose appropriate punishment with cogent reasons in support thereof. 19. In Indian Oil Corporation Ltd. v. Ashok Kumar Arora, (1997) 3 SCC 72 , it was held that the Court will not intervene unless the punishment is wholly disproportionate. It was, thus, concluded that unless the Court/Tribunal opines in its secondary role that the administrator was, on the material before him irrational, according to Wednesbury or CCSU norms, the punishment cannot be quashed. 20. Noticing the above noted decisions on the doctrine of proportionality, in exercise of judicial review, it was held in Chairman cum Managing Director (supra) that if the punishment imposed on an employee by an employer is grossly excessive, disproportionate, it cannot claim immunity from judicial scrutiny, and it is always open for the Court to interfere with such penalty in appropriate case. (Reference sub-para-24 of para-25). It was finally concluded in para-'26' as under : ''26. The doctrine of proportionality is, thus, well recognized concept of judicial review in our jurisprudence. What is otherwise within the discretionary domain and sole power of the decision maker to quantify punishment once the charge of misconduct stands proved, such discretionary power is exposed to judicial intervention if exercised in a manner which is out of proportion to the fault. Award of punishment which is grossly in access to the allegations cannot claim immunity and remains open for interference under limited scope of judicial review.
Award of punishment which is grossly in access to the allegations cannot claim immunity and remains open for interference under limited scope of judicial review. One of the tests to be applied while dealing with the question of quantum of punishment would be : would any reasonable employer have imposed such punishment in like circumstances? Obviously, a reasonable employer is expected to take into consideration measure, magnitude and degree of misconduct and all other relevant circumstances and exclude irrelevant matters before imposing punishment. In a case like the present one where the misconduct of the delinquent was unauthorized absence from duty for six months but upon being charged of such misconduct, he fairly admitted his guilt and explained the reasons for his absence by stating that he did not have any intention nor desired to disobey the order of higher authority or violate any of the Company's Rules and Regulations but the reason was purely personal and beyond his control and, as a matter of fact, he sent his resignation which was not accepted, the order of removal cannot be held to be justified, since in our judgment, no reasonable employer would have imposed extreme punishment of removal in like circumstances. The punishment is not only unduly harsh but grossly in excess to the allegations. Ordinarily, we would have sent the matter back to the appropriate authority for reconsideration on the question of punishment but in the facts and circumstances of the present case, this exercise may not be proper. In our view, the demand of justice would be met if the Respondent No. 1 is denied back wages for the entire period by way of punishment for the proved misconduct of unauthorized absence for six months.'' 21. Considering the above, we are of the considered view that the allegation against the writ petitioner relates to impropriety by not adhering to the procedure prescribed for release of payment to the contractor engaged by the Corporation, however, the writ petitioner had no jurisdiction for sanction/disbursement of the contract amount nor the 'Note' submitted by him was a sanction to release the payment. The writ petitioners, thus, cannot be held solely responsible for commission of irregularity in the matter of submitting proposal for payment to the contractor, due to which admittedly no financial loss has been caused to the Corporation.
The writ petitioners, thus, cannot be held solely responsible for commission of irregularity in the matter of submitting proposal for payment to the contractor, due to which admittedly no financial loss has been caused to the Corporation. In any case, the payment made to the contractor may be treated as advance to the contractor in order to expedite execution of the work which was duly adjusted as contract money against the executed work, as per the terms and conditions of the contract. 22. There is a finding to the effect that the writ petitioner had submitted the 'office Note' on the oral instructions of the senior officer and not on his own. Thus, we find that the writ petitioner cannot be said to have committed any financial illegality nor he can be said to be solely responsible for any irregularity in the matter of payments released to the contractor, without furnishing of the bills on the date of the presentation of the 'office Note'. However, he is found guilty of not adhering to the norms/procedures for submission of 'Note', for release of payment to the contractor. It is, thus, concluded that the writ petitioner has committed impropriety in not adhering to the settled procedure and in view of charge No. 1 having been proved against him, based on the documentary evidence in the records of the Corporation, it cannot be said that the writ petitioner was deprived of opportunity to rebut the evidence during the course of inquiry or the inquiry cannot be said to be vitiated for violation of principles of natural justice. 23. However, coming to the quantum of punishment, we are convinced with the arguments of the learned counsel for the writ petitioner that the writ petitioner was singled out and has been used as a pawn by the higher officials who have either been exonerated in the inquiry initiated against them or no inquiry at all was initiated against them. 24. In the above circumstances, the imposition of penalty of termination of the services of the writ petitioner by the disciplinary authority was unduly harsh and grossly disproportionate to the proven misconduct. The punishment of removal from service imposed upon the writ petitioner, as such, cannot be countenanced. 25.
24. In the above circumstances, the imposition of penalty of termination of the services of the writ petitioner by the disciplinary authority was unduly harsh and grossly disproportionate to the proven misconduct. The punishment of removal from service imposed upon the writ petitioner, as such, cannot be countenanced. 25. Resultantly, while setting aside the punishment order, in exercise of power of judicial review, in the instant matter, where the punishment imposed is found to be grossly disproportionate to the proven misconduct, the matter is remitted back to the disciplinary authority to pass a fresh punishment order. 26. While setting aside the order of punishment dated 14.10.2020 passed by the disciplinary authority as also the order dated 20.9.2021 passed by the appellate authority, we dispose of the appeal with the direction to the disciplinary authority to pass a fresh order of punishment proportionate to the proven misconduct, by giving opportunity to the writ petitioner to show-cause by issuing notice within a period of four weeks from the date of receipt of a copy of this order. 27. In the result, while setting aside the judgment and order dated 21.3.2023 passed by the learned Single Judge in allowing the writ petition, the appeal stands disposed of.