E. Krishnamoorthy vs Tamil Nadu Electricity Board

K.Chandru, J.—The Petitioner who was employed by the Respondent Tamil Nadu Electricity Board, as an Inspector of Assessment, has

come forward to file the present writ petition challenging a charge memo, dated 30.1.2009.

By the charge memo, the Petitioner was accused of not taking enough care while taking cash collection to the bank deposit and not arranging

proper security. It was found out that while he was working as an Inspector of Assessment at Chembakkam in Doraipakkam office of the

Executive Engineer, Chennai Electricity Distribution Circle (South), a cash amount of Rs. 4,97,271/- and cheque value of Rs. 38,421/- were taken

to the Indian Bank, Rajakeelpakkam Branch for deposit. But the money was taken away by some miscreants. Hence it was alleged that the

Petitioner who was responsible for the loss, had committed misconduct in terms of the Standing Order 19(i) applicable to the clerical cadre of the

Respondent Board and that he had not taken proper care and caution in arranging appropriate security.

The contention of the Petitioner was that he had already reached the age of superannuation on 31.1.2009 and was allowed to retire, but no

order was passed retaining him in service though it is stated in the said order that the retirement was without prejudice to the charges pending

against him. The contention of the counsel for the Petitioner was that under the Standing Orders, there is no power to retain an employee in service

for the purpose of inflicting penalty pursuant to the disciplinary action. Hence the order is illegal.

When the writ petition came up on 2.4.2009, the Standing Counsel for the Electricity Board was directed to take notice. Subsequently, in the

interim applications for grant of direction and interim stay, no orders were passed. On notice from this Court, the Respondents have filed a counter

affidavit, dated 22.10.2009.

In the counter affidavit, it is stated that at no point of time, the Board had directed any person to go in two wheeler to remit the huge sums of

amount and merely because the Standing Orders do not provide, it cannot be said that there is no power. Since it is already indicated that it is

subject to disciplinary action taken against him and that the charge memo, dated 30.01.2009 was already pending, there is no illegality. Even

otherwise, it was stated that under Rule 9 of the Tamil Nadu Pension Rules, if the departmental proceedings are initiated when a Government

servant is in service, it will be deemed to be a proceedings under the rule and it shall be continued and concluded in the same manner as if the

government servant had continued in service. Since the employment in the Electricity Board has been brought under pensionable establishment and

the Tamil Nadu Pension Rules has been made applicable, the contention of the Petitioner cannot be countenanced.

Though the counsel for the Petitioner wanted to reply upon certain decisions of this Court, the issue raised by the Petitioner has been squarely

covered by a judgment of this Court in T.K.K. Tharmar v. Registrar Central Administrative Tribunal Chennai Bench Chennai and Ors. reported in

(2008) 3 MLJ 877 and in paragraphs 8, 21 to 28, it was observed as follows:

Alternatively, he submitted that since the Petitioner was allowed to retire by an order dated 29.4.2005, no further proceedings can be initiated

against him and his superannuation will terminate all further proceedings. For this purpose, reliance was placed on the following three Division

Bench judgments of this Court:

(a) N.M. Somasundaram v. The Director General of Police, Madurai -4 and Ors. (1997 W.L.R. 120);

(b) The State of Tamil Nadu Vs. R. Karuppiah, Inspector of Police (Under Orders of Suspension) and The Registrar, Tamil Nadu Administrative

Tribunal, ; and

(c) P. Muthusamy Vs. Tamilnadu Cements Corporation Limited,

With reference to the second contention regarding the bar on taking disciplinary action, we must consider the relevant rule before proceeding

to deal with the legal submissions. As per the proceedings dated 29.4.2005 issued by the second Respondent, a decision was taken to deal with

the case in terms of Rule 9 of the CCS (Pension) Rules. Rule 9 of the said Rules reads as follows:

Right of President to withhold or withdraw

pension

((1)The President reserves to himself the right of withholding a pension or gratuity, or both, either in full or in part, or withdrawing a pension in full

or in part, whether permanently or for a specified period, and of ordering recovery from a pension or gratuity of the whole or part of any pecuniary

loss caused to the Government, if, in any departmental or judicial proceedings, the pensioner is found guilty of grave misconduct or negligence

during the period of service, including service rendered upon re-employment after retirement:

Provided that the Union Public Service Commission shall be consulted before any final orders are passed:

Provided further that where a part of pension is withheld or withdrawn the amount of such pensions shall not be reduced below the amount of

rupees three hundred and seventy-five (Rupees One thousand nine hundred and thirteen from 1-4-2004 -see GID below Rule 49) per mensem.)

(2)(a)The departmental proceedings referred to in Sub-rule (1), if instituted while the Government servant was in service whether before his

retirement or during his re-employment, shall, after the final retirement of the Government servant, be deemed to be proceedings under this rule and

shall be continued and concluded by the authority by which they were commenced in the same manner as if the Government servant had continued

in service:

Provided that where the departmental proceedings are instituted by an authority subordinate to the President, that authority shall submit a report

recording its findings to the President.

(b)The departmental proceedings, if not instituted while the Government servant was in service, whether before his retirement, or during his re-

employment, -

(i)shall not be instituted save with the sanction of the President, (ii)shall not be in respect of any event which took place more than four years before

such institution, and (iii)shall be conducted by such authority and in such place as the President may direct and in accordance with the procedure

applicable to departmental proceedings in which an order of dismissal from service could be made in relation to the Government servant during his

service.

(3)Deleted

(4)In the case of Government servant who has retired on attaining the age of superannuation or otherwise and against whom any departmental or

judicial proceedings are instituted or where departmental proceedings are continued under Sub-rule (2), a provisional pension as provided in Rule

69 shall be sanctioned.

(5)Where the President decides not to withhold or withdraw pension but orders recovery of pecuniary loss from pension, the recovery shall not

ordinarily be made at a rate exceeding one-third of the pension admissible on the date of retirement of a Government servant.

6)For the purpose of this rule, -(a)departmental proceedings shall be deemed to be instituted on the date on which the statement of charges is

issued to the Government servant or pensioner, or if the Government servant has been placed under suspension from an earlier date, on such date;

and (b)judicial proceedings shall be deemed to be instituted -(i)in the case of criminal proceedings, on the date on which the complaint or report of

a police officer, of which the Magistrate takes cognizance, is made, and (ii)in the case of civil proceedings, on the date the plaint is presented in the

court.

In the light of the above Rule, there will be no difficulty for the Respondents to proceed with the enquiry.

of the three Division Bench judgments cited by the Petitioner, the first decision went on the interpretation to Rule 56(1)(c) of the Fundamental

Rules made by the Tamil Nadu Government. The third decision related to an employee working in a Government company.

In the second decision, while dealing with F.R. 56 (1)(c), this Court also relied upon the judgment of the Supreme Court reported in Bhagirathi

Jena Vs. Board of Directors, O.S.F.C. and Others, and after referring to paragraphs 6 and 7, came to the conclusion that if an employee was

permitted to retire on attaining the age of superannuation, then there was no power vested in the authority to proceed against an employee after

attaining the age of superannuation until he was suspended from service pending further action.

But on a careful reading of the judgment of the Supreme Court in Bhagirathi Jena case (cited supra), it can be seen that the said case

proceeded on the basis that in the absence of any specific provision in the relevant rule, the authority will have no legal power to reduce the retiral

benefit or conduct of a disciplinary proceeding.

The Bhagirathi Jena''s case was subsequently considered by the Supreme Court in Ramesh Chandra Sharma Vs. Punjab National Bank and

Another, . The following passages found in the paragraphs 16, 17 and 19 to 22 may be usefully extracted below:

Para 16: ""The question, thus, as to whether continuation of a disciplinary proceeding would be permissible or the employer will have to take

recourse only to the pension rules, in our opinion, would depend upon the terms and conditions of the services of the employee and the power of

the disciplinary authority conferred by reason of a statute or statutory rules.

Para 17: We have noticed hereinbefore that the Bank has made Regulations which are statutory in nature. Regulation 20(3)( iii ) of the said

Regulations reads thus:

20.(3)( iii ) The officer against whom disciplinary proceedings have been initiated will cease to be in service on the date of superannuation but the

disciplinary proceedings will continue as if he was in service until the proceedings are concluded and final order is passed in respect thereof. The

officer concerned will not receive any pay and/or allowance after the date of superannuation. He will also not be entitled for the payment of

retirement benefits till the proceedings are completed and final order is passed thereon except his own contribution to CPF.

The said Regulation clearly envisages continuation of a disciplinary proceeding despite the officer ceasing to be in service on the date of

superannuation. For the said purpose a legal fiction has been created providing that the delinquent officer would be deemed to be in service until

the proceedings are concluded and final order is passed thereon. The said Regulation being statutory in nature should be given full effect.

It was further observed in the said judgment after reviewing all the case laws that in case of a pension retiree, the power always lies with an

employer to take further action even after retirement. The following passages found in paragraphs 19 to 22 of the said judgment may be extracted:

Para 19: ""The issue is, thus, no longer res integra, which as would be evident from the ratio laid down by this Court from time to time.

Para 20: In State Bank of India v. C.B. Dhall 6 it was held as under: (17 SCC 553 ) "" 17. Under Rule 20-B disciplinary proceedings if initiated

against an employee before he retires from service could be continued and concluded even after his retirement and for the purpose of conclusion of

the disciplinary proceedings, the employee is deemed to have continued in service but for no other purpose.

Para 21: In Harihar Bhole Nath upon considering Regulations 351-A and 470 of the Civil Services Regulations, this Court following Brahm Datt

Sharma opined as under:

The right to withhold or withdraw the pension may arise in different situations. Two different contingencies are clearly envisaged under the

Regulations viz. if the pensioner is found guilty of misconduct either in departmental proceedings or in judicial proceedings. Although, prima facie,

the proviso appended to Regulation 351-A does not envisage continuation of the proceedings, the same must be held to be existing on a plain

reading thereof. Regulations 351-A and 470 provide for a composite scheme; by emphasising that payment of pension is not automatic it can be

withheld if the conditions laid down therein are satisfied. Undoubtedly, before an order of withholding the amount of pension or a part thereof is

passed, the procedures laid down under the statute are required to be complied with. The procedural safeguards must be kept in mind. Limitations

of application of the Rules again have to be borne in mind.

But the said Rules read with the proviso and the Explanation appended thereto construed in their entirety clearly postulate that the proceeding

initiated before the delinquent officer reached his age of superannuation would be valid.

this Court therein distinguished this decision in State of U.P. v. Shri Krishna Pandey and Bhagirathi Jena v. Board of Directors, O.S.F.C. in the

following terms: ( Harihar Bhole Nath case, SCC pp. 468-70, paras 20 and 25)

The High Court has placed strong reliance on State of U.P. v. Shri Krishna Pandey 7 wherein the departmental enquiry was initiated after the

delinquent officer reached his age of superannuation. Noticing Regulation 351-A of the Civil Services Regulations and that the departmental

proceeding was initiated after the retirement of the employee, the same was held to be impermissible in law. Although it was not necessary to

pronounce upon the construction of Regulation 351-A involving a case where a departmental proceeding was initiated prior to reaching of the age

of superannuation by the delinquent officer, it was observed that as the officer had retired on 31-3-1987 and proceedings were initiated against

him on 12-4-1991, proviso appended to the rule would be applicable.

***

Reliance has also been placed on Bhagirathi Jena v. Board of Directors, O.S.F.C. 8 wherein this Court was concerned with interpretation of

Regulation 17 of the Orissa State Financial Corporation Employees Provident Fund Regulations, 1959.

To the same vein is the decision of this Court in State of U.P. v. R.C. Misra.

Para 22: We are, therefore, of the opinion that it was permissible for the Bank to continue with the disciplinary proceedings relying on or on the

basis of Regulation 20(3)( iii ) of the Punjab National Bank (Officers) Service Regulations, 1979.

Therefore, in the light of the above, it has to be held that even after retirement, if there are statutory Rules providing for continuation of the

disciplinary proceedings, no exception can be taken for continuing a disciplinary action by an employer.

In the present case, Rule 9 is a complete answer for the contention raised by the Petitioner. It must also be noted that very recently, the

Supreme Court in the judgment reported in U.P. State Sugar Corporation Ltd. and Others Vs. Kamal Swaroop Tondon, dealt with a case of the

employer''s right to initiate action even after retirement. The following passages found in paragraphs 27 and 28 may be usefully reproduced:

Para 27: ""In UCO Bank and Others Vs. Sanwar Mal, , the Court held that two concepts: (i) resignation; and (ii) retirement were different and

employed for different purposes and in different contexts. Resignation brings about complete cessation of master and servant relationship, but

retirement does not do so. In case of retirement, master and servant relationship

continues for grant of retiral benefits. Para 28: If it is so, the Appellant Corporation, in our opinion, is right in submitting that the proceedings could

have been continued after the retirement of the Respondent employee as far as the financial loss caused to the Corporation because of negligence

on the part of employee and the benefit claimed by the Respondent workman on his terminal benefits are concerned.

In the light of the above, there is no case made out to entertain the writ petition. But, Mr. Balan Haridoss, Learned Counsel for the Petitioner

stated that subsequent to the order, dated 30.01.2009, there has been no progress in the enquiry. The counsel for the Respondents stated that

because of pendency of the writ petition, no action was possible. But, however, it is unnecessary to keep the person under suspended animation

for ever. Therefore, it is for the Board to take action as expeditiously as possible and complete the process of enquiry within a period of six months

from the date of receipt of copy of this order. With the above direction, the writ petition will stand dismissed. No costs. Consequently, connected

miscellaneous petitions stand closed.