JUDGMENT : R. Raghunandan Rao, J. 1. Heard Sri Kasa Jaganmohan Reddy, learned counsel for the appellants and Sri Subbarao Korrapati, learned counsel for the 1st respondent. 2. The 1st respondent herein had retired as a General Manager of the 1st appellant-corporation on 31.08.2020. He approached this Court by way of W.P. No. 25668 of 2020 on the ground that his retiral benefits were not being given to him by the 1st appellant-corporation. 3. It is the stand of the 1st appellant-corporation that the 1st respondent is entitled to payment of gratuity of Rs. 18,37,400/-, earned leave encashment of Rs. 11,09,094/-and provident fund amount of Rs. 8,69,777/-, aggregating to a sum of Rs. 38,16,271/-as his retiral benefits. However, the 1st appellant-corporation is entitled to recover the loss of Rs. 64,75,819/-, sustained by the corporation on account of recovery of these amounts from the 1st appellant corporation by M/s. Food Corporation of India (herein referred to as "FCI"). The 1st appellant-corporation took the stand that the FCI had recovered two separate amounts of Rs. 31,30,638/-towards shortage of rice bags found during the regional vigilance authorities inspection on 09.07.2013 and a further amount of Rs. 33,45,181/-towards excess storage losses declared by the 1st respondent while working as Warehouse Manager, Kodada, for the months of January, February, March, August and September, 2013. These recoveries fell to the share of M/s. Telangana Warehousing Corporation, which sought these amounts to be recovered by the 1st appellant from the 1st respondent herein. 4. The 1st appellant also took the stand that the aforesaid retiral benefits of Rs. 38,16,271/-was adjusted against the loss of Rs. 64,75,819/-and that the 1st respondent still owes an amount of Rs. 26,59,548/-, to the 1st appellant-corporation and the same was also demanded from the 1st respondent by a letter dated 12.10.2020. It is the contention of the 1st appellant that such amounts are recoverable under Rule 6 of the Andhra Pradesh Warehousing Corporation Employees Provident Fund Regulations, 1965, which is extracted herein below: "No member of the staff can claim any relief under these regulations as a matter of right. Gratuity shall not be paid to any employee who has been convicted of criminal offence, or has been dismissed for dishonesty or misconduct in the Corporation. Gratuity shall not be paid to any employee who has been convicted of criminal offence, or has been dismissed for dishonesty or misconduct in the Corporation. Any amount that may be due to the Corporation by any member of the staff on account of any advance made or loans given or any other account shall be adjusted at the discretion of the Corporation from gratuity and only the balance, if any, paid." 5. The learned Single Judge interpreted the aforesaid regulations to mean that money can be recovered from a member of the staff only if he is convicted of a criminal offence or has been dismissed for dishonesty or misconduct in the corporation. The Learned Single Judge held that the 1st respondent is entitled to all these retiral benefits as no criminal case has been registered against the 1st respondent nor was he dismissed from the corporation on the grounds of dishonesty or misconduct. Consequently, the Learned Single Judge, allowed the writ petition by an order dated 04.08.2023, directing the release of retiral benefits to the 1st respondent within a period of three (03) months from the date of receipt of the order and to pay interest @ 9% from the date of retirement till the payment, if such release of retiral benefits is not done within three months. 6. Aggrieved by the said order, the appellants have moved the present writ appeal before this Court. 7. Sri Kasa Jaganmohan Reddy, learned counsel for the appellants would submit that Rule 6 of the Andhra Pradesh Warehousing Corporation Employees Provident Fund Regulations, 1965, extracted above, does not shut out recovery of any amounts, even if the member of the staff had not been convicted of a criminal offence or was dismissed for dishonesty or misconduct. He would submit that there are two limbs to the said rule. The first limb states that gratuity need not be paid at all, irrespective of the fact whether there is loss to the corporation or not, if the employee has been convicted of a criminal offence or had been dismissed for dishonesty or misconduct. The second limb stipulates that any amount due to the corporation on account any advance made or loans given or on any other account can be adjusted, at the discretion of the corporation, from the gratuity payable to the member of the staff. The second limb stipulates that any amount due to the corporation on account any advance made or loans given or on any other account can be adjusted, at the discretion of the corporation, from the gratuity payable to the member of the staff. He would also contend that as a sum of Rs. 64,75,819/-is due from the 1st respondent, it would be within the power of the 1st appellant-corporation to adjust the entire retirement benefits of Rs. 38,16,271/-against the dues of the corporation and also to claim the balance amount of Rs. 26,59,548/-. 8. Sri Subbarao Korrapati, learned counsel appearing for the 1st respondent would submit that the provision cannot be split into two parts and should be read together. He would submit that the pre-requisite for invoking the said regulation is the factum of conviction of a criminal offence or dismissal for dishonesty or misconduct. He would submit that in the absence of these conditions, it would not be possible to invoke the regulation itself. 9. Sri Subbarao Korrapati, learned counsel appearing for the 1st respondent would also contend that though the FCI had recovered an amount of Rs. 31,30,638/-on the ground that an inspection in the Warehouse at Kodada, on 09.07.2013, had revealed losses, to the tune of Rs. 31,30,638/-, while the 1st respondent was incharge of the said godown, there is subsequent correspondence which clearly shows that the calculation of such loss was incorrect and that there was no loss at all. He would contend that in such circumstances, the question of recovery of alleged loss would not arise. 10. Rule 6 of the regulations, extracted above, contains two limbs, as contended by Sri Kasa Jagan Mohan Reddy, learned counsel for the appellants. In the present case, the 1st limb would not apply as the pre-requisites, mentioned above, do not arise in the case. However, the second limb does empower the corporation to recover or adjust the amounts due to it from the gratuity payable to an employee. 11. In the present case, the gratuity payable to the 1st respondent is only a sum of Rs. 18,37,400/-. The remaining retiral benefits cannot be adjusted on the basis of this rule. 12. A perusal of the material placed before this Court shows that the FCI, on the basis of the inspection carried on 09.07.2013, had identified shortage of rice bags resulting in loss of Rs. 31,30,638/-. 18,37,400/-. The remaining retiral benefits cannot be adjusted on the basis of this rule. 12. A perusal of the material placed before this Court shows that the FCI, on the basis of the inspection carried on 09.07.2013, had identified shortage of rice bags resulting in loss of Rs. 31,30,638/-. However, a committee was constituted with three members being drawn from the 1st appellant corporation and five members being drawn from the FCI for 100% physical verification of the stocks which was conducted between 23.08.2013 and 12.10.2013. This committee, after completion of the said inspection, had declared that the net difference is nil and the shortage of 842 bags shown on a peripheral count was null and void. The Telangana State Warehousing Corporation had written a letter dated 21.06.2018 to FCI for releasing the recovered amount as there was no shortage, as claimed by FCI, for making such recoveries. 13. These facts are not disputed by the 1st appellant-corporation. In the light of these undisputed facts, it must be held that there could not have been any recovery of Rs. 31,30,638/-on the ground of alleged shortage of rice bags. Consequently, the Telangana State Warehousing Corporation, which is the successor corporation for the Kodada Warehouse, will have to take steps for recovery of money from the FCI and the same cannot be recovered from the 1st respondent herein by the 1st appellant-Andhra Pradesh State Warehousing Corporation for remitting the same to the Telangana State Warehousing Corporation. 14. This leaves an amount of Rs. 33,45,181/-said to have been the excess storage losses declared by the 1st respondent himself, while working as Warehouse Manager, Kodada. The 1st respondent has been making requests for furnishing various documents and records for the purposes of ascertaining whether there were such losses and whether he had made such statements. It appears that such documents have not been furnished to the 1st respondent. 15. As held above, the Rule only permits recovery of money from the gratuity amounts and the said rule does not extend to recovery of money from the earned leave encashment or the provident fund amounts. 16. In the circumstances, this Writ Appeal is disposed of with a direction to the 1st appellant-corporation to release the earned leave encashment and the provident fund amounts to the 1st respondent, on the same lines, as directed by the Learned Single Judge in his order. 16. In the circumstances, this Writ Appeal is disposed of with a direction to the 1st appellant-corporation to release the earned leave encashment and the provident fund amounts to the 1st respondent, on the same lines, as directed by the Learned Single Judge in his order. It is further directed that the gratuity amount can be adjusted only after an opportunity of hearing is given to the 1st respondent to make good his contention that there were no losses amounting to Rs. 33,45,181/-due to excess storage losses declared by him and to demonstrate that he is not liable for such recovery. The exercise of furnishing all the necessary papers and documents to the 1st respondent and completion of such enquiry shall be completed within a period of three (03) months from the date of receipt of the order. It is only after such enquiry is conducted, that any steps can be taken by the 1st appellant-corporation for adjusting the withheld amounts towards such losses. There shall be no order as to costs. As a sequel, pending miscellaneous petitions, if any, shall stand closed.